Many large projects awaiting licences

According to the Foreign Investment Department, many large-scale FDI projects are waiting for investment licences. Among them is a steel billet project by Taiwan’s Tycoons WorldWide Steel group with investment capital up to over $1 billion in central Quang Ngai Province.

Another steel and metallurgy project worth $1.94 billion by S.H.T Iron & Steel Co. is also awaiting MPI approval.

In northern Vinh Phuc Province, there are the $570 million Vietnam Horse-race Co, Ltd and a $160 million sea port project.

Japan’s Sumitomo group is also planning a $600 million project to build an economic zone in central Khanh Hoa Province.

An official from the Foreign Investment Department said that Vietnam’s political stability and continuous high growth rate in recent years were the reasons for the coming of foreign investors.

Especially, Vietnam’s preparation for WTO accession with its notable reforms in terms of investment environment and legal system have strengthened the trust of foreign investors, especially those from the US and Japan. If investment via a third country is taken into consideration, the US is now the leading country for FDI in Vietnam.

According to the Japan External Trade Organisation (JETRO), Vietnam ranked eighth on the list of top destinations for Japanese investments in 2000. It jumped to 4^th position last year, after China, India and Thailand, and was the 2^nd for Japanese small and medium investors, after China.

Vietnam is also being praised as one of the two best places in Southeast Asia for medium- and long-term investment attraction ability.

HCM City’s FDI rises in quantity and quality

In early August 2006, HCM City was leading the country in FDI attraction with 168 projects licenced, with a total registered capital of nearly $1.1 billon, exclusive of operating projects that increase investment. The number of newly licenced projects in the first seven months of the year was not high but the total investment capital rose by nearly four times year on year.

The structure of FDI in the city showed a clear move from labour intensive fields to areas with high added value.

Of 168 new projects, there were 66 projects in the processing industry totaling $674.8 million, 59 projects in assets business and consulting services worth $62.4 million, and 17 projects in construction, valuing $21 million.

The city also lured ten projects in transport with $256.5 million of capital and two in banking worth $30 million. The most outstanding character of FDI in HCM City this year is the appearance of big, high-quality projects

The MPI has recently approved a project to build a container port at the Hiep Phuoc Industrial Zone by the UK’s P&O group worth $300 million.

This is considered the ‘second Intel event” of HCM City in 2006. With this project, the city regained its top position in FDI attraction in Vietnam.