As of July 20, FDI disbursement was estimated at 11.58 billion USD, up 0.8 per cent year-on-year. (Photo: VNA)

Hanoi – Vietnam's foreign direct investment (FDI) attraction has seen signs of recovery after continuous declines over the past six months, becoming a driving force for the country’s economic growth in the medium and long term, said insiders.

According to the General Statistics Office (GSO), the total registered foreign investment capital in Vietnam from the beginning of this year to July 20 reached 16.24 billion USD, up 4.5 per cent year-on-year. Of the total, 11.58 billion USD had been disbursed, a rise of 0.8 per cent over the same period last year.

Between January and July, there were 1,293 newly-registered FDI projects with a combined capital of 7.94 billion USD, up 75.5 per cent in the number of projects and 38.6 per cent in capital compared to the same period last year.

Vietnam's attractiveness remained in the eyes of international investors, despite a wave of strategic adjustments as well as a reduction in investment activities on a global scale, according to experts. It reflects the Government's efforts to promote cooperation, support FDI enterprises and improve the investment environment, experts said, adding that the country's participation in many free trade agreements also creates advantages for goods produced in Vietnam, especially when the tax rate has become a strength, helping maintain the country’s competitiveness in the race to lure foreign capital.

According to Vice Chairman of LG Innotek Group Cho Ji Tae, the efforts of Vietnam in general and localities in particular in improving the business environment is one of the main reasons to retain investors. Meanwhile, a representative of the European Chamber of Commerce in Vietnam (EuroCham) said that European investors' confidence has increased again thanks to the good inflation control and the macroeconomic stability of the Southeast Asian nation.

It is noteworthy that a lot of localities are proactively clearing bottlenecks, promoting potential and investment as well as creating the most favourable conditions for investors to attract new projects. For example, the northern province of Thai Nguyen has launched a "campaign" in this regard.

According to Chairman of the provincial People's Committee Trinh Viet Hung, the province boasts favourable conditions to welcome investors, with appropriate policies, including financial support in vocational training for workers. This is a solution that contributes to accelerating the implementation and improving the feasibility of projects, he said.

At the macro level, the Government continues to focus on speeding up reforms and perfecting institutions and regulations related to FDI; actively promotes investment on the international scale, focusing on large and potential partners in terms of capital and technology such as the Republic of Korea, Japan, Europe and the US.

The most significant effort in attracting FDI is that Vietnam always stabilises its macro economy, along with socio-political stability, said Director of the Ministry of Planning and Investment’s Foreign Investment Agency Do Nhat Hoang.

Besides, it is paying attention to improving the investment environment as well as creating conditions for production and business activities, he added.

A survey of Japanese enterprises in Vietnam conducted by the Japan Trade Promotion Organisation (JETRO) in 2022 showed that 60 per cent of the surveyed enterprises said they will expand their business in Vietnam in the next one or two years.

They also said Vietnam has the advantage of high growth potential, and businesses can increase revenue by expanding markets and increasing exports.