Vietnam's FDI capital disbursement hits five-year record high despite US tariff turmoil

Disbursed foreign direct investment (FDI) capital in Vietnam reached $13.6 billion in Jan-July, up 8.4% year-on-year, despite U.S. tariff concerns.

The figure is a record high in the last five years for the seven-month period, the Ministry of Finance's Foreign Investment Agency (FIA) reported on Wednesday.

Of this, the processing and manufacturing industry accounted for 81.6% ($11.1 billion), followed by real estate ($1.09 billion or 8%); and production and distribution of electricity, gas, hot water, steam, and air conditioning ($505.2 million or 3.7%).

Registered FDI capital reached $24.09 billion in the seven-month period, up 27.3% year-on-year.

At the FIA's calculations, registered capital comprises capital for newly-registered projects, additional capital for existing projects, and capital for stake acquisitions.

Of the total registered capital, nearly $10.03 billion (down 11.1% year-on-year) was capital for 2,254 newly-registered projects (up 15.2%).

About $9.99 billion, a 95.3% increase compared to the same period last year, was additional capital for 920 existing projects.

Foreign investors made 1,982 capital contributions/stake acquisitions at the total value of $4.07 billion, up 61%. Of this, capital contributions/stake acquisitions in the manufacturing and processing industry accounted for 39.3% or $1.6 billion.

Of the total capital for newly-registered projects, the processing and manufacturing industry held the lion's share with $5.61 billion or 55.9%. Next was real estate business with $2.36 billion or 23.5%.

Among the 74 countries and territories with newly-registered projects in the seven months, Singapore was the largest investor with $2.84 billion, making up 28.3% of the total. The following positions were mainland China ($2.27 billion), Sweden ($1 billion), Japan ($865.8 million), and Taiwan ($735 million).

Among the largest manufacturing projects licensed in the period is a $1 billion polyester fabric recycling complex project of Sweden’s leading textile manufacturer Syre in Nhon Hoi Economic Zone, Binh Dinh province, now Gia Lai province after the merger of Binh Dinh and Gia Lai. The project, designed to have a capacity of up to 250,000 tons per year, is expected to become operational by the end of 2028.

Following its merger with two industrial hubs Binh Duong and Ba Ria-Vung Tau provinces, Ho Chi Minh City rose to the top in seven-month newly-registered capital with nearly $1.31 billion. In the first 6 months of the year, this position belonged to Binh Dinh thanks to the $1 billion project of Syre.

Bac Ninh jumped one place to the second position after merging with Bac Giang, recording $1.1 billion. Gia Lai province placed third with $1.07 billion after its merger with Binh Dinh province, home to the Syre project.

After the merger of Hung Yen and Thai Binh provinces, the new Hung Yen rose three places to the fourth position with nearly $1.07 billion. Hai Phong city placed fifth despite its merger with Hai Duong province.

Ninh Binh ranked seventh in the first seven months of the year with $1.01 billion as it merged with Nam Dinh and Ha Nam provinces. In the first six months, it was not in the list of top 10 provinces and cities in registered FDI capital attraction.

Combining capital for newly-registered projects and expansion capital for existing projects, Bac Ninh is the biggest FDI recipient in the seven-month period with $3.87 billion. Next were Hanoi with $3.44 billion and HCMC with $1.96 billion.

On April 2, President Donald Trump announced that the U.S. would impose a general tariff rate of 10% on its trade partners, alongside country-specific rates of up to 50% on dozens of nations.

A week later, he decided to delay the reciprocal tariff rollout for 90 days, with plans to resume on July 9. Just days ahead of that deadline, Trump signed an executive order on July 7, pushing the deadline further to August 1.

Trump on July 31 signed an executive order imposing new reciprocal tariffs on imports from 69 countries and territories, with rates ranging from 10% to 41%. Vietnam was hit with a 20% levy, down from 46%.