Binh Duong, a manufacturing hub in southern Vietnam, is the country’s biggest recipient of registered FDI capital in the first six months of the year, with $2.53 billion or 18% of the entire sum.
The figure is up 98.2% year-on-year thanks to Lego Group’s $1 billion toy making factory in VSIP Binh Duong III industrial park.
Ho Chi Minh City ranked second with $2.2 billion, accounting for 15.8% of the country’s total, up 55.2%.
Bac Ninh, an emerging manufacturing hub in northern Vietnam, ranked third with $1.63 billion, making up 11.7% of the country’s entire sum and 3.3 times higher than the same period last year, followed by Thai Nguyen, Hai Phong, and Hanoi.
Bac Ninh and Thai Nguyen are home to Samsung’s smartphone factories that account for over half of the Korean giant’s smartphones made globally.
Foreign investors focused investments in big cities with favorable infrastructure like HCMC and Hanoi. HCMC led the pack in the number of newly-registered FDI projects (40.4%), and stake acquisitions (68.3%), and ranked second in the number of projects having their capital expanded (14%), after Hanoi (16.6%).
From 1986 when the country introduced its Doi moi economic reform policy to date, HCMC has lured $55.2 billion in registered capital, accounting for 12.9% of the country’s total, followed by Binh Duong with $39.6 billion or 9.2%, and Hanoi with $37.7 billion or 8.8%.
Binh Duong province in June was glorified by Intelligent Community Forum (ICF) in its Top 7 Communities of 2022 list thanks to the Binh Duong Smart City project.
FDI capital registered in Vietnam in the year to June 20, which includes newly-registered capital, expanded capital and capital contribution for stake acquisitions, hit over $14.03 billion, down 8.9% year-on-year.
Of this, the manufacturing and processing sector led the pack with $8.84 billion, accounting for 63% of the entire sum. The real estate sector ranked second with $3.15 billion, or 22.5%.
Foreign-invested project disbursement reached $10.06 billion, a 8.9% increase against the same period last year and a record high in five years.
Vietnam continues to be one of the top countries in Southeast Asia for FDI attraction, especially in the manufacturing sector, according to HSBC.
The country has become a rising star in global supply chains, gaining a substantial global market share in many sectors including textiles, footwear, and consumer electronics, the bank noted in a report.
Research shows that new FDI has been flowing into the country since the 2010s, with the lion’s share focused on the manufacturing sector, consistently equivalent for 4-6% of GDP.