Vietnam worth Investment

According to statistics of the Foreign Investment Agency, Ministry of Planning and Investment (MPI), by Quarter IV, 2015, real estate sector attracted US$2.32 billion of FDI, ranking 3^rd in attraction of investments with 29 new projects and 10 projects increasing by 11.5 per cent of the total investment in the sector.

 

Another new development is that, together with increased investments from other countries, most investments are from existing projects in Vietnam. Therefore, investment capital from outside is much less than the total in 2015.

 

Experts also warned that though capital mobilised from existing investments is not illegal, inflow of capital will be less than expected. They also recommended that the State apply green technology to real estate development to protect the environment.

 

Meanwhile, many experts believed that FDI flow will continue in real estate for a few years, even with projects worth billion US dollars.

 

It is also believed that, in spite of up and down in real estate, strategic foreign investors still regard it as a lucrative profit-making sector. Especially when rigid administrative formalities have been removed and new land law enforced since July 1, 2014, FDI can increase in housing projects and it becomes more attractive to foreign investors. Furthermore, the conclusion of TPP will serve as a capital channel for economic growth and real estate market in particular.

 

MPI statistics show that FDI in 2015 increased to US$22.76 billion, up by 12.5 per cent compared to last year, while disbursed capital was US$14.5 billion (up by 17.4 per cent). In 2015, processing and manufacturing industries continue to lead FDI with registered capital of US$15.23 billion (nearly 67 per cent of total registered capital) and followed by the production and distribution of electricity, gas and refrigeration and real estate.

 

In 2015, 48 provinces and cities have new FDI projects with Ho Chi Minh City leading by US$2.81 billion (18 per cent of new registered capital) followed by Tra Vinh, Binh Duong, Dong Nai, Ha Noi, Hai Phong, Tay Ninh, Quang Ninh. In 2015, among countries and territories investing in Vietnam, South Korea ranks first with US$2.68 billion, followed by Malaysia, Japan, UK, Singapore and Taiwan (China).

 

In the new conditions with FTAs, TPP, and AEC, local provinces are more active in attracting foreign investments; Binh Duong, with advantages of industrial zones, has attracted FDI of over US$2.8 billion. So far, the province has 2,568 FDI projects from 39 countries and territories with total investment capital of over US$23 billion.

 

According to Vice Chairman Tran Thanh Liem of Binh Duong People’s Committee, the key to attract FDI is to bring into full play of local advantages, technical and social infrastructure, human resources, accelerating administrative reform and land clearance in favour of investors.

 

With insights of opportunities created by TPP, in 2014 and early 2015, the province has asked investors and management boards of industrial zones to accelerate the development of infrastructure and space for a new wave of investments. As a result, the province has attracted major projects from important corporations in the world.

 

In the context of globalisation and competition, Vietnam has advantages not only in real estate development, but also in other sectors. Most recently, Japanese investors developed cooperation with Vietnam in agricultural production. Meanwhile, garment, footwear and wood processing are also lucrative sectors for foreign investors.