Vietnam increasingly attractive to foreign investors

FDI attraction to reach US$39-40 billion

Dr. Phan Huu Thang, former Director of the Ministry of Planning and Investment’s Foreign Investment Agency, told the Vietnam Economic News that despite global economic challenges and competition in attracting FDI, Vietnam is forecast to attract US$39-40 billion of FDI in 2024, with disbursement expected to reach US$23-24 billion, equivalent to the results achieved in 2023.

Many technology giants are planning to invest billions of USD in Vietnam in the near future

According to economists, the global economy is undergoing complex and rapid changes. The development of digital technology, artificial intelligence, and supply chains is driving significant shifts in the structure of the global economy. At the same time, climate change, political instability, and changes in trade policies among major countries are posing significant obstacles to attracting foreign investment flows.

Assoc. Prof., Dr. Nguyen Mai, Chairman of the Vietnam Association of Foreign Invested Enterprises, stated that competition in attracting FDI among countries in the region and the world is becoming increasingly intense. Therefore, the US$39-40 billion FDI forecast for 2024 shows that Vietnam is truly an attractive destination for foreign investors.

Sharing his views on Vietnam’s investment environment, He Jia Ji, Vice Chairman of the Guangxi Union of Enterprises under the Chinese Business Association in Vietnam, and a Chinese logistics investor in Vietnam, stated that besides the advantages of an increasingly improved investment environment, Vietnam is also attractive due to its deep economic integration process. Vietnam has signed and basically completed negotiations on 17 free trade agreements (FTAs) with over 60 countries and territories, and is currently negotiating or preparing to negotiate three additional FTAs and economic frameworks.

According to He Jia Ji, Vietnam attracts foreign investors also due to its success in drawing top 500 global electronics corporations to invest in the country. These corporations have a high demand for components and accessories to manufacture electronic products, which has, in turn, attracted numerous enterprises to invest in supporting industries.

Khvatec Thai Nguyen Co., Ltd. in Yen Binh Industrial Park, Pho Yen City, Thai Nguyen Province - Photo: VNA

Opportunities from major high-tech FDI projects

The Vietnamese Government has recently signed a cooperation deal with NVIDIA, a leading US technology corporation, to establish an Artificial Intelligence (AI) Research and Development (R&D) Center in Vietnam. This makes Vietnam the third location where NVIDIA has invested in an AI R&D center, following the US where NVIDIA is headquartered and Chinese Taipei, the homeland of Jensen Huang, the corporation’s Founder and CEO.

According to Vo Xuan Hoai, Director of the National Innovation Center (NIC), NVIDIA chose Vietnam as an investment destination due to many reasons. These include the improving quality of its workforce, strategic geographic location, political stability, a market with 100 million consumers, and, notably, Vietnam’s investment attraction policies, which have been highly regarded by NVIDIA’s founder.

Earlier, in July 2024, Foxconn Group received an investment certificate from Quang Ninh Province for two projects with the total investment of US$551 million. One project is to manufacture smart entertainment products, while the other will focus on smart systems. These two projects have increased Foxconn’s total investment in Vietnam to over US$3 billion, with nearly US$1 billion in Quang Ninh.

Meanwhile, Amkor Group has recently been allowed to increase investment in its semiconductor project in Bac Ninh Province by an additional US$1.07 billion. This has raised the total investment in Amkor’s project to US$1.6 billion, 11 years ahead of schedule. Initially, Amkor planned to invest the full US$1.6 billion in Vietnam by 2035.

Many technology giants, such as Samsung, LG, and Posco are also planning to invest billions of USD in Vietnam in the near future. Specifically, according to Jeong Cheol-dong, CEO of LG Display, the corporation has invested over US$5 billion in Vietnam and plans to invest an additional US$3 billion over the next five years. Under this plan, the LG Innotel factory is expected to double its capacity, thereby establishing a fully integrated production complex for LG in Vietnam.

Meanwhile, Samsung has long regarded Vietnam as its global production hub, with the total investment exceeding US$22 billion and continuously growing in recent years. With its R&D Center launched in late 2022, Samsung has identified Vietnam as its global R&D hub, a role Vietnam had never previously envisioned./.