Vietnam leads in FDI index among 14 emerging markets
Vietnam has topped an index for foreign direct investment (FDI) in emerging market countries for the second year in a row, according to a study by FDI Intelligence, a Financial Times data analysis report.
A 2015 study into inbound greenfield investment in 14 emerging markets showed that Vietnam scored 6.45, which meant the country attracted more than six times the amount of foreign direct investment that might be expected relative to the size of its economy, ranking far ahead of neighboring competitors in the ASEAN region such as Thailand (2.43) and Malaysia (2.86).
According to the latest report released by the United Nations Conference on Trade and Development, global investors have their eyes on “emerging Asian countries”, and Vietnam is no exception. Statistics pointed out that in 2015 emerging economies in the Asian region welcomed 541 billion USD in investment.
The report showed that investors have recently started to target Vietnam while many are moving away from China due to more expensive labour costs and geopolitical risks.
According to the Financial Times, in the recent years, Vietnam has gained many positive results to improve the national economic attractiveness in the eyes of foreign investors.
The World Bank's latest report on investment climate (Doing Business) showed that Vietnam has made significant improvements. Criteria such as access to power, credit information and payment have been raised, while the time for business registration and corporate income tax has been reduced, according to the report.
Foreign direct investment inflows hit US$11.3 billion in the first three months of this year, according to the Ministry of Investment and Planning.
47.8% of FDI projects that Vietnam attracted last year belong to manufacturing sector, followed by the financial services industry and manufacturing electronic components.
In the context that the country has concluded a variety of free trade agreements, it is increasingly easier for foreign investors to enter the Vietnamese market.
Foreign investors have also started to enter Vietnam via mergers and acquisitions. Official statistics show that foreign investors have become majority shareholders in more than 1,700 local companies in the past year.
From July 1, 2015 to July 20, 2016, these investments were estimated to reach1.89 billion USD, according to the Foreign Investment Agency under the Ministry of Planning and Investment.
The Vietnamese Government’s commitment to accelerate share sales in state-owned enterprises will provide more opportunities for foreign investors.
Vietnam last month officially scrapped a long standing 49% foreign-ownership cap in publicly listed companies, allowing foreign investors to own a 100% stake in several listed companies across various industries, including consumer, property, transport, construction, manufacturing, financial services and agriculture.
Photo for illustration.
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The report showed that investors have recently started to target Vietnam while many are moving away from China due to more expensive labour costs and geopolitical risks.
According to the Financial Times, in the recent years, Vietnam has gained many positive results to improve the national economic attractiveness in the eyes of foreign investors.
The World Bank's latest report on investment climate (Doing Business) showed that Vietnam has made significant improvements. Criteria such as access to power, credit information and payment have been raised, while the time for business registration and corporate income tax has been reduced, according to the report.
Illustrative image.
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47.8% of FDI projects that Vietnam attracted last year belong to manufacturing sector, followed by the financial services industry and manufacturing electronic components.
In the context that the country has concluded a variety of free trade agreements, it is increasingly easier for foreign investors to enter the Vietnamese market.
Foreign investors have also started to enter Vietnam via mergers and acquisitions. Official statistics show that foreign investors have become majority shareholders in more than 1,700 local companies in the past year.
From July 1, 2015 to July 20, 2016, these investments were estimated to reach1.89 billion USD, according to the Foreign Investment Agency under the Ministry of Planning and Investment.
The Vietnamese Government’s commitment to accelerate share sales in state-owned enterprises will provide more opportunities for foreign investors.
Vietnam last month officially scrapped a long standing 49% foreign-ownership cap in publicly listed companies, allowing foreign investors to own a 100% stake in several listed companies across various industries, including consumer, property, transport, construction, manufacturing, financial services and agriculture.
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