Vietnam Reports Huge Pledged FDI, But Modest Disbursement: MPI Official

Foreign investors are estimated to disburse US$47 billion in foreign direct investment (FDI) in Vietnam between 2001 and 2009, accounting for just one-third of the country’s total registered FDI in the period, said an official from the Ministry of Planning and Investment (MPI).

 

Vietnam licensed 8,476 FDI projects totaling US$124 billion during the period, the Thoi Bao Kinh Te online newspaper reported Monday, citing Director of the MPI’s Foreign Investment Agency Do Nhat Hoang as saying.

 

The FDI sector now makes up some 25%-30% of Vietnam’s total development investments and generates 1.7 million jobs. Its average export revenue growth is estimated at 25% annually, Hoang said at a FDI conference in Hanoi on May 21.

 

He noted that FDI flow has shifted to the services sector from the industrial and construction sectors. Up to 77% of the country’s total pledged FDI have been poured into the services sector, compared to the ratio of 7% in 2001-2009 period.

 

The industrial and construction sectors saw the ratio of 22% and 85%, respectively.

 

However, officials at the conference proposed that the MPI should tighten control over FDI projects to stamp out long-delayed and environment polluting ones.

 

Delays of mammoth projects like a US$10-billion steel complex in Ninh Thuan province and a US$4.15-billion tourism complex in Quang Nam province have exposed the lax management of the government over FDI, Hoang highlighted. 

 

FDI quality is now a worrying issue for Vietnam. If the government does not take timely measures, it will fail to reach FDI targets, said Chairman of the Vietnam Association for Foreign-invested Enterprises Nguyen Mai.

 

Mai also suggested the government to remove tax incentives for FDI firms in several sectors like mining to raise their contribution to the state budget. (chinhphu.vn May 22, vneconomy.vn May 21)