Singapore-based United Overseas Bank (UOB) on November 27 signed an expanded Memorandum of Understanding (MoU) with the Foreign Investment Agency (FIA) under Vietnam's Ministry of Planning and Investment, which will see the bank facilitating an additional pipeline of more than US$1.1 billion in foreign direct investment to Vietnam, following US$2.24 billion secured from the first MoU signed in 2015.

A view of the signing of the MoU. Photo: UOB

Vietnam received close to US$14 billion in disbursed FDI in the first nine months of the year across all industries, and UOB is helping companies from across the region ride on the momentum, focusing on high growth sectors. These are the sectors that the Vietnamese government seeks to develop, namely sustainable energy, manufacturing, infrastructure, healthcare and technology.

Tapping the trade corridors between ASEAN and Greater China, the UOB has helped more than 150 companies seize opportunities in Vietnam and aims to double the number with the latest MOU.

As part of the value chain, small- and medium-sized enterprises (SMEs) which support these sectors will also benefit. More than 2,000 jobs in Vietnam are also forecast to be created from the next wave of investments. This is on top of more than 17,000 jobs already created under the first MoU. More Singaporean companies are also expected to invest in Vietnam as part of increased business and closer ties between the two countries.

“The expanded MoU with the FIA reaffirms our close and collaborative relationship in helping regional companies tap Vietnam’s vibrant economy, driving their sustainable advancement and boosting trade flows and job creation across ASEAN,” said Wee Ee Cheong, deputy chairman and CEO of UOB.

Under the agreement, the FIA could broaden access to investment opportunities beyond the main cities of Ho Chi Minh City and Hanoi and into fast-developing provinces such as Bac Ninh, Hai Duong, Binh Duong and Dong Nai.

The FIA will also provide companies referred by UOB with advisory on investment policies and dedicated support in investment procedures and applications. Meanwhile, the UOB FDI Advisory team provides companies from across the bank’s network with local insights, market entry support and customized financial solutions, and connects them to regional business opportunities.

Vietnam continues to be an attractive destination for FDI, with an average of 9% growth in FDI inflows from 2015 to 2019.

The country’s attractiveness to foreign investors remained unabated amid the Covid-19 pandemic, registering a GDP growth rate of 2.62% in the third quarter of 2020 even as economies in the region contracted.