Vietnam gets record FDI inflow

September 29, 2015 at 12:10

HANOI — Vietnam received an estimated record $9.65 billion in actual foreign direct investment (FDI) so far this year, with strong inflows going to the manufacturing sector, a key driver for the country’s economic growth.

New FDI pledges in the January-September period rose 44.5% from a year ago to $11.03 billion, the ministry’s report said, citing major projects such as the $2.4-billion Duyen Hai 2 thermal power plant.

Vietnam has embarked on liberal reforms to strengthen capital markets and position itself as a low-cost manufacturing alternative to China, especially for cell phones, televisions, footwear and garments.

New FDI commitments in manufacturing account for 70% of the total $84.8 billion attracted by Vietnam between 2011 and August 2015, the Asian Development Bank said on Tuesday.

It raised Vietnam’s gross domestic product growth forecast this year to 6.5% from 6.1% earlier, citing rising private consumption, export-oriented manufacturing and FDI.

Foreign firms expanding in Vietnam include Samsung, LG, Microsoft and Intel.

An additional $3 billion placed by Samsung Display, a subsidiary of the world’s top smartphone maker Samsung Electronics Co. Ltd., has helped boost the FDI inflow, the report said.

Samsung Display plans to put another $3 billion into Vietnam by 2020.

Vietnam has projected drawing $23 billion in FDI pledges in 2015, up nearly 40% from last year, while actual inflows are expected to be on par with 2014 at $12.5 billion, the report said, citing Planning and Investment Minister Bui Quang Vinh.

Over the next five years, Vietnam aims to lift its growth rate to an annual average of 6.5%-7.0% by capitalizing on multilateral trade deals, modernizing agriculture and boosting investments, its communist party has said. — Reuters