Supply chain diversification opportunities help Vietnam attract FDI in 2024: broker

By Lan Do
Sat, February 24, 2024 | 8:24 am GMT+7

Opportunities for supply chain diversification, economic improvements and political stability are the aspects that would enable Vietnam to continue attracting FDI in 2024, according to Rong Viet Securities Company.

Global FDI will likely expand marginally in 2024, according to the Vietnamese broker (VDSC), which cited the United Nations Conference on Trade and Development's prediction for global FDI capital flows.

Vietnam is expected to continue attracting more FDI in 2024. Photo courtesy of the government's news portal.

Vietnam is expected to continue attracting more FDI in 2024. Photo courtesy of the government's news portal.

VDSC analysts believe that the probability of drawing FDI capital to Vietnam in 2024 will remain strong due to three considerations.

First and foremost, Vietnam is a prospective country for firms' supply chain diversification strategies.

Second, Vietnam's economic development is likely to improve this year, and third, the political framework remains secure.

However, chances of negative developments remain due to geopolitical uncertainties, high debt levels in other countries, and the possibility of a drop in global economic growth, all of which might have an influence on FDI flows into Vietnam, the broker noted.

In a report released early this month, Mirae Asset Securities Vietnam (MAVN) predicted Vietnam will remain attractive to foreign investors even after it began applying the global minimum tax.

Some of the factors driving FDI attraction will include the elevation of Vietnam-US ties to that of a comprehensive strategic partnership; manufacturers looking for new markets to locate factories or adopting the China+1 strategy; and acceleration in infrastructure investment, the broker wrote.

"FDI inflows will also be catalyzed by supportive policies and the nation’s commitment to net-zero carbon emissions by 2050; and competitive labor costs compared with other Asian countries," it added.

James Cheo, chief investment officer for Southeast Asia and India, Global Private Banking and Wealth, at HSBC, in a January report noted that the strong inflows of FDI will likely continue in 2024, buttressing Vietnam’s manufacturing sector. The strength of the national economy will come from a combination of consumer and investment spending.

Registered FDI in Vietnam reached $36.6 billion in 2023 through December 20, up 32.1% year-on-year, the highest ever growth, according to the Ministry of Planning and Investment.

The total registered FDI included registered capital for new projects, additional capital for ongoing projects and capital contribution for stake acquisitions. The disbursement of FDI capital grew 3.5% year-on-year to $23.18 billion.

In terms of localities, HCMC led the pack of recipients with total registered capital of approximately $5.9 billion, up 48.5% year-on-year, of which the value of capital contributions and share purchases was $4.3 billion, accounting for over 73%.

The three fields that attracted the most FDI in HCMC were information and communication; transportation, and warehousing-real estate.

However, excluding capital contributions and share purchases, the six northern industrial provinces that attracted outstanding FDI in 2023 were Hai Phong (around $3.1 billion), Quang Ninh ($3.1 billion), Bac Giang ($3 billion), Thai Binh ($2.8 billion), Bac Ninh ($1.7 billion), and Nghe An ($1.6 billion).

The two investors that surpassed South Korea were Hong Kong and mainland China, rising to third and fourth place with total investments of $4.7 billion and $4.5 billion, respectively, in 2023. Investors from Hong Kong and mainland China focused on three groups, including solar cell manufacturing, electronic products and components, and vehicle support.

Comments (0)
  • Read More
Vietnam needs large, specialized logistics centers to compete better: official

Vietnam needs large, specialized logistics centers to compete better: official

Vietnam needs large-scale, specialized logistics centers that will enable greater competitiveness of local economies and enterprises, says Tran Thanh Hai, deputy head of the Ministry of Industry and Trade's agency of foreign trade.

Economy - Sun, November 3, 2024 | 11:00 am GMT+7

Vietnam manufacturing sector sees 35% increase in Q3 job orders: Adecco

Vietnam manufacturing sector sees 35% increase in Q3 job orders: Adecco

Vietnam’s manufacturing and sourcing sectors saw a substantial 35% year-on-year increase and a 52% quarter-on-quarter increase in Q3/2024 job orders, global workforce solutions provider Adecco said in a reseach report released Thursday.

Economy - Sun, November 3, 2024 | 9:00 am GMT+7

Construction majors to continue capitalizing on public investment projects

Construction majors to continue capitalizing on public investment projects

Vietnamese construction giants are expected to continue capitalizing on public investment projects for the remainder of this year after delivering strong performances in the third quarter, analysts say.

Companies - Sun, November 3, 2024 | 8:00 am GMT+7

Former Government Office chairman receives $7,900 bribe from property project

Former Government Office chairman receives $7,900 bribe from property project

Mai Tien Dung, former Minister-Government Office Chairman, received a bribe worth VND200 million ($7,900) from Nguyen Cao Tri, owner of the Dai Ninh eco-resort and urban area project in Lam Dong province.

Society - Sat, November 2, 2024 | 9:13 pm GMT+7

Thai food giant CP enters public-private partnership to promote food system transformation

Thai food giant CP enters public-private partnership to promote food system transformation

Thai-invested C.P. Vietnam Livestock JSC and the Partnership for Sustainable Agriculture Vietnam (PSAV) signed a memorandum of understanding Friday on working together to advance sustainable agriculture in the country.

Companies - Sat, November 2, 2024 | 7:16 pm GMT+7

Central Vietnam province Quang Ngai to begin work on new VSIP industrial park next year

Central Vietnam province Quang Ngai to begin work on new VSIP industrial park next year

Vietnam’s central province of Quang Ngai will work with the investor to have construction of VSIP II Quang Ngai, a facility based on the Vietnam-Singapore Industrial Park (VSIP) model, begin in August 2025.

Industrial real estate - Sat, November 2, 2024 | 3:47 pm GMT+7

Vietnam likely to grow 6.5% in 2024-2025: VinaCapital

Vietnam likely to grow 6.5% in 2024-2025: VinaCapital

VinaCapital, among the biggest foreign-run asset managers in Vietnam, has forecast the country’s economy to achieve 6.5% growth in both 2024 and 2025, with the composition of the expansion to change to more domestically driven factors next year.

Economy - Sat, November 2, 2024 | 2:00 pm GMT+7

Major Vietnamese developer Novaland appoints new CEO

Major Vietnamese developer Novaland appoints new CEO

Duong Van Bac, who joined Novaland as chief financial officer in August 2023, has been appointed general director, starting Friday.

Companies - Sat, November 2, 2024 | 10:24 am GMT+7

Vietnamese conglomerate Bamboo Capital posts 36-fold profit growth in Q3

Vietnamese conglomerate Bamboo Capital posts 36-fold profit growth in Q3

Ho Chi Minh City-based Bamboo Capital Group recorded an after-tax profit of VND331.2 billion ($13.1 million) in the third quarter of 2024, an astounding 36-fold expansion year-on-year.

Southeast Asia - Sat, November 2, 2024 | 9:41 am GMT+7

ThaiBev to bag $54 mln from Sabeco’s upcoming dividend payout

ThaiBev to bag $54 mln from Sabeco’s upcoming dividend payout

Vietnam Beverage, wholly owned by Thai Beverage (ThaiBev) will rake in VND1,374 billion ($54.26 million) worth of dividend from Ho Chi Minh City-based top brewer Sabeco.

Companies - Sat, November 2, 2024 | 9:13 am GMT+7

Steel heavyweight Hoa Phat pours over $2 bln into central Vietnam complex

Steel heavyweight Hoa Phat pours over $2 bln into central Vietnam complex

Leading Vietnamese steelmaker Hoa Phat had invested more than VND52.5 trillion ($2.08 billion) in its Dung Quat Iron and Steel Integrated Complex (Dung Quat 2) in the central province of Quang Ngai as of Q3/2024.

Industries - Sat, November 2, 2024 | 8:00 am GMT+7

Vietnam becomes Australia’s fastest-growing inbound market

Vietnam becomes Australia’s fastest-growing inbound market

The number of Vietnamese tourists to Australia has grown significantly after the Covid-19 pandemic, with nearly 178,000 reported in the 12 months to August 2024, according to a Friday press release by the Australian Minister for Trade and Tourism’s Office.

Southeast Asia - Fri, November 1, 2024 | 10:02 pm GMT+7

Study finds shift in Thai consumers’ spending patterns

Study finds shift in Thai consumers’ spending patterns

Consumers in Thailand are shifting their spending focus to experiences and investments, according to the latest ASEAN Consumer Sentiment Study (ACSS) by United Overseas Bank (UOB).

Southeast Asia - Fri, November 1, 2024 | 10:00 pm GMT+7

Energy security, digitalization key to Indonesia's economic growth

Energy security, digitalization key to Indonesia's economic growth

The Indonesian government is prioritizing long-term economic growth through energy security, digitalization, and natural resource industrialization, according to Deputy Minister of Finance Thomas Djiwandono.

Southeast Asia - Fri, November 1, 2024 | 9:58 pm GMT+7

Vietnam PM's Middle East tour creates breakthroughs in economic, trade, investment cooperation: FM

Vietnam PM's Middle East tour creates breakthroughs in economic, trade, investment cooperation: FM

Prime Minister Pham Minh Chinh’s freshly ended six-day trip to the UAE, Saudi Arabia and Qatar has produced important outcomes, demonstrating the growing relations between Vietnam and the three Middle-East countries, Deputy Prime Minister and Foreign Minister Bui Thanh Son told the Vietnam News Agency.

Politics - Fri, November 1, 2024 | 9:25 pm GMT+7

Vietnam, Qatar look to tap potential for energy, oil & gas collaboration

Vietnam, Qatar look to tap potential for energy, oil & gas collaboration

Vietnam and Qatar have recognized the significant potential for further collaboration in multiple sectors such as energy, oil and gas, especially LNG, agriculture, Halal industry, and banking.

Politics - Fri, November 1, 2024 | 9:02 pm GMT+7