Foreign direct investment (FDI), especially in southern provinces, is expected to increase sharply with a number of billion-dollar projects in the pipeline, according to the Foreign Investment Agency (FIA).

The Department of Planning and Investment of Binh Duong province said a textile and garment project by Hong Kong’s Wai Chi Kai Knitting Company would soon be licensed and could be the first billion-dollar project of 2019.

The company will invest 1 billion USD to build a factory to produce knitted collar products, wrist bands, ribbed fabric, fabric, and textile and fashion accessories in the Dong An II Industrial Zone in Thu Dau Mot city.

The People’s Committee of Bac Lieu province is urging the Ministry of Industry and Trade to speed up licensing of a 4.3 billion USD liquefied natural gas (LNG)-fuelled power project by US company Energy Capital.

Though investment procedures for a power plant are not simple, Bac Lieu hopes the 3,200 MW project will soon get an investment certificate.

In addition, three major projects are finalising procedures for getting a licence this year. They include a 500 million USD project by the Republic of Korea’s Hana Micron, which in April signed a deal with the Bac Giang Industrial Zones Management Authority to build a semiconductor production plant.

Apparel Far Eastern is seeking to invest an additional 610 million USD in its existing plant while Meiko Electronics plans to add 200 million USD. CP Foods of Thai billionaire Dhanin Chearavanont is planning to invest 200 million USD in a pork and poultry farm.

In the first half of the year, Hong Kong remained Vietnam’s leading source of FDI with 5.3 billion USD, or 29 percent of total investment, thanks to Beerco Limited investing 3.85 billion USD for a stake in Vietnam Beverage Co Ltd.

The RoK was second with 2.73 billion USD, followed by mainland China with 2.29 billion USD, Singapore with 2.2 billion USD, and Japan with 1.95 billion USD.

Overall, foreign investors have brought or registered to bring in 18.47 billion USD in the first six months of the year.

Hanoi remained the most attractive destination with more than 4.87 billion USD in the period, or 26.4 percent of all FDI. 

HCM City was next with 3.21 billion USD, a 20 percent increase year-on-year. Of the sum, 539 million USD went into new projects, a 3.6 percent increase. Forty-one percent went into the property sector, nearly 22 percent into the technology sector, 19.5 percent into wholesale and retail and repair of automobiles, motorbikes and other vehicles and 5.8 percent into manufacturing.

The southern provinces of Binh Duong and Dong Nai were third and fourth with 1.37 billion USD and 1.2 million USD.

FDI from Japan

According to the Ministry of Planning and Investment, Japan has so far invested 57.9 billion USD in Vietnam in 4,190 projects, the second highest of any country or territory.

Recently, during Prime Minister Nguyen Xuan Phuc’s visit to Japan, there were 32 memorandums of understanding between Vietnamese and Japanese firms involving investment of 8 billion USD.

A recent survey by the Japan External Trade Organisation (JETRO) found Vietnam second in the list of countries where Japanese enterprises want to expand in future.

But according to JETRO, the country’s weakness is that its supporting industries are not capable of supplying FDI enterprises, and local firms need to collaborate with their foreign counterparts to increase the rate of local content.