Report on business registration and FDI in July/2024 (Part 2)

II. Report on foreign direct investment situation in July 2024 nationwide

1. Overview

July 2024 recorded many positive changes in the foreign direct investment (FDI) situation in Vietnam.

Foreign Investment in the First 7 Months of 2024 by Month

According to a report from the Ministry of Planning and Investment, total implemented capital, registered capital, number of projects and exports in July 2024 all increased compared to the same period in 2023, specifically:

• Implemented capital: 1,708 million USD

Registered capital:

• New registration: 1,227.13 million USD
• Additional registration: 1,017.65 million USD
• Capital contribution, share purchase: 571.07 million USD

Project number:

• New level: 278 projects
• Capital increase: 142 projects
• Capital contribution and share purchase: 375 projects

Export:

• Exports (including crude oil): 26,163 million USD
• Exports (excluding crude oil): 26,062 million USD
• Import: 20,889 million USD

Detailed information on investment structure by industry

Regarding investment structure by industry, foreign investors have invested in 18 of the 21 national economic sectors. Outstanding industries in the first 7 months of 2024 are as follows:

• Processing and manufacturing industry leads with a total investment capital of more than 12.65 billion USD, accounting for 70.3% of total registered investment capital, a 15.7% increase over the same period in 2023;
• The real estate business ranked second with a total investment capital of more than 2.87 billion USD, accounting for nearly 16% of total registered investment capital, a 78% increase over the same period in 2023;
• Next are the wholesale and retail industries; professional, scientific, and technological activities with total registered capital of nearly 740.5 million USD and more than 490.6 million USD, respectively.

The above data shows that the processing and manufacturing industry is highly attractive to foreign investors. In addition, daily essential consumer needs tend to increase, and the development of e-commerce and industrial parks are factors that promote industries such as wholesale, retail, and professional activities, science and technology. Meanwhile, rising demand for housing and other infrastructure in Vietnam creates opportunities for real estate companies.

2. Detailed information on investment structure by country

Regarding investment structure by country, data from the Ministry of Planning and Investment shows that Singapore and Hong Kong are the two leading countries in terms of total investment capital in the first 7 months of 2024, of which:

• Singapore is Vietnam’s largest investment partner in the first 7 months of 2024 with a total investment capital of nearly 6.52 billion USD, accounting for 36.2% of total registered FDI capital, a 79.1% increase over the same period in 2023.
• Hong Kong ranked second with a total investment capital of 2.19 billion USD, accounting for 12.2% of total registered FDI capital, more than 2 times higher than the same period in 2023.
• Next are Japan, China, Korea,…

In terms of number of projects alone, China is the leading partner in the number of new investment projects (29.7%) while Korea leads in the number of capital adjustments (24.5%) and contribute capital and buy shares (26%).

The largest investment partners in the first 7 months of 2024 are all traditional partners of Vietnam and from Asia.

3. Detailed information on investment structure by locality

Foreign investors have invested in 48 provinces and cities across the country in the first 7 months of 2024.

The leading: Bac Ninh

With a total registered investment capital of nearly 3.2 billion USD, accounting for 17.8% of total capital, 3 times higher than the same period.

Bac Ninh is an industrial province with a strategic location in the Northern key economic region, developed with many industrial parks and large investment projects in the field of processing and manufacturing.

Top 2: Quang Ninh

With nearly 1.56 billion USD, accounting for 8.7% of total registered investment capital and 2.2 times higher than last year.

Infrastructure development and priority policies Investment incentives, especially in industrial parks and coastal economic zones, are primary draws for foreign investors to this province.

Top 3: Ho Chi Minh City

With a total registered investment capital of more than 1.55 billion USD, accounting for nearly 8.6% of the total investment capital.

This city remains an important economic center, attracting numerous investment projects in the fields of high technology, real estate, and financial services.

Next come Ba Ria – Vung Tau, Hanoi, Hai Phong and so on. Ho Chi Minh City leads the country in both the number of new projects (39.1%) and contributing capital and share purchases (nearly 70.1%). Hanoi Hanoi has the highest percentage of projects with capital adjustments (14%).

Investment capital is heavily concentrated in provinces and cities with many advantages in attracting foreign investment (good infrastructure, stable human resources, efforts to reform administrative procedures and capacity to attract foreign investment, active in investment promotion, etc) such as Bac Ninh, Quang Ninh, Ho Chi Minh City, Ba Ria – Vung Tau, Hanoi, Hai Phong.

Structure of Investment Capital in 2024 by province

4. Conclusion

Overall, the foreign direct investment situation in Vietnam in July 2024 reflects many positive signals and strong development prospects following the economic downturn caused by the COVID-19 pandemic. It is forecasted that in the coming months, FDI inflows will continue to increase, contributing to promoting economic growth and creating more jobs for employees. Foreign investors continue to see Vietnam as an ideal destination for business and investment.

To learn more about the Report on business registration and FDI in July/2024 (part 1), check out for more details to understand the Business Registration Situation in July and the first 7 months of 2024 nationwide: [Part 1]

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References:

Foreign direct investment (FDI) attraction situation in the first 7 months of 2024

Foreign direct investment (FDI) data in 2024

Time of writing: 28/08/2024

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