In order to attract multinationals, Hanoi must be more specific in investment promotion activities and understand what investors are looking for, according to Nguyen Mai, president of the Vietnam Association of Foreign-Invested Enterprises (VAFIE).

Nguyen Mai, president of the Vietnam Association of Foreign-invested Enterprises (VAFIE).

Hanoi holds numerous advantages in attracting foreign direct investment (FDI), but the important issue would not be the quantity, but the quality of investment, Mai said in an interview with Kinh te & Do thi newspaper.

Therefore, the process of selecting the right project is essential, Mai suggested, adding Hanoi should be a pioneering city in Vietnam in attracting major hi-tech projects.

Mai suggested as China has been chosen as a location for headquarters by the majority of the 500 world’s largest companies, Hanoi and Ho Chi Minh City should also aim at the same target.

To achieve this target, Hanoi should step up efforts to attract FDI from Europe and the US. For example, the US is investing US$4 trillion abroad, of which Vietnam has drawn only US$11 billion in registered capital from the US, of which around US$6 billion has been disbursed.

In terms of infrastructure, Hanoi is the country’s hub of research institutes and universities, which could provide high quality human resources.  Moreover, Hanoi is currently in the process of deploying the 5G network.

In the immediate future, Hanoi should focus on improving education quality, reducing traffic congestion and reparing environmental pollution, Mai stated.

While the city is pushing for administrative reforms, it should pay more attention to investing in modern industrial parks and the logistics network to support potential investors.

In comparison with other major cities in Asia, many foreign investors consider Hanoi one of the most peaceful cities.

Recently, Hanoi has been among a handful of cities getting out of the Covid-19 crisis, and recorded an economic growth rate of 3.39% in the first six months of the year, significantly higher than the national growth of 1.81% and other cities in the world, Mai stated.

Mai cited surveys from international organizations that more than half of investors in Vietnam are looking to expand investment in the country. Notably, out of 62% enterprises looking to exit China, and 42% are eyeing Vietnam.

Foreign direct investment (FDI) commitments in Hanoi in the year to May 19 increased 6.1% inter-annually to US$1.04 billion

Among countries and territories having invested in Hanoi during the January – May period, Singapore took the lead with US$262.7 million. Japan claimed the second spot with US$230 million, followed by Taiwan (China) with US$185.5 million, and South Korea with US$106.9 million.

At the “Hanoi 2020 – Investment and Development Cooperation” conference held on June 27, Hanoi's leaders signed 36 memorandum of understandings (MOUs) worth US$26.08 billion with organizations, businesses and investors, including 23 MOUs with domestic enterprises (US$17.85 billion) and 13 with foreign ones (US$8.22 billion).

The Hanoi People’s Committee has also announced an investment portfolio comprising of 282 projects with estimated investment capital of VND483.1 trillion (US$21.66 billion) in eight priority fields, including 151 industrial, trade and services projects; 34 projects of technical infrastructure development; 45 projects of social housing; nine environmental projects;13 projects of repairing and rebuilding old complexes; 10 projects in housing development; 15 agricultural projects; five urban development projects along the Vo Nguyen Giap avenue.