FDI Into Vietnam Hits $25 Billion In 11 Months

One month before 2022 ends, Vietnam’s foreign direct investment (FDI) inflows reached $25.1 billion, according to the Ministry of Planning and Investment.

While there was an 18% decrease ($11.5 billion)from last year’s total registered capital from the investment certificates issued by the government to 1,812 projects, the 11-month period recorded 994 projects that amplified their investment capital by $9.54 billion, up by 23.3% from the same period in 2021.

In addition, the disbursed volume of FDI went up by 15% and reached $19.68 billion.

This year's a booming year for the country. In the first half of 2022, Denmark poured a total of $1.32 billion of investment into Vietnam, surpassing Singapore and China.

Moreover, counting in the first half up until September 2022, FDI in Vietnam reached $15.43 billion, a 16.3% increase from the previous year. This is the highest level of realized FDI in nine months for the past five years.

In October, we wrote about how Vietnam is taking Thailand’s crown as ASEAN FDI King. And as the year ends, Vietnam is just 5% short of what was last year's FDI inflows — a clear indication of Vietnam's stable-than-ever economy.

Sustained increases in FDI inflows are often a sign of an improved investment climate. Although the largest share of FDI goes from high-income economies to other high-income economies, flows to developing countries are increasing and are very important in helping to support sustainable development, which is the direction Vietnam is taking.

From a global perspective, FDI boosts the manufacturing and services sector, which results in the creation of jobs and helps to reduce unemployment rates in the country. In Vietnam, among the 19 sectors, manufacturing and processing lead in terms of the amount of foreign investment received — $14.96 billion, making up 59.5%.

The real estate sector followed with $4.19 billion, electricity production and distribution with $2.26 billion, and science and technology brought in $1.03 billion.

With FDI creating new jobs and more opportunities for investors, this can lead to an increase in income and more purchasing power for locals, which in turn leads to an overall boost in targeted economies.

According to the Ministry of Planning and Investment, Singapore is still the largest investor from the region over the reviewed period, with nearly $5.78 billion, making up 23% of the total capital inflows. Japan’s next in line with $4.6 billion, and the Republic of Korea with $4.1 billion.