Vietnam kicked off the year with an impressive surge in foreign direct investment (FDI), attracting more than $4.33 billion in January—a remarkable 48.6% year-on-year increase, according to the Ministry of Planning and Investment’s Foreign Investment Agency.
This surge reflects the growing confidence of international investors in Vietnam’s business environment and long-term economic potential. Sophie Dao, Senior Partner at Global Business Services LLC (GBS), emphasized that these figures underscore Vietnam’s position as a premier investment destination in Asia, thanks to its strong economic fundamentals, strategic location, and ongoing reforms to enhance the investment climate.
Manufacturing and Real Estate Lead the Way
The manufacturing and processing industry continued to dominate foreign investment, attracting over $3.09 billion, which accounted for nearly 71.3% of total FDI. This sector witnessed an astonishing 99.1% year-on-year growth, further solidifying Vietnam’s role as a global manufacturing hub.
Meanwhile, real estate secured the second-highest FDI inflow at $1.09 billion, representing 23.5% of total investments, despite a slight 6.4% decline from the previous year. Sophie Dao noted that Vietnam’s booming real estate sector remains highly attractive, with investors focusing on industrial parks, commercial properties, and high-end residential projects as demand continues to grow.
Impressive Gains in Capital Adjustments and Share Purchases
While new project registrations in January totaled 282 projects with $1.29 billion in capital (a 43.6% decrease year-on-year), the sharp rise in capital adjustments from existing projects signaled strong investor commitment. Additional capital from 137 ongoing projects surged more than sixfold to $2.73 billion, demonstrating foreign investors’ confidence in Vietnam’s long-term growth prospects.
Foreign investors also showed renewed interest in share purchases and capital contributions, with 260 transactions totaling $322.9 million, reflecting a 70.4% year-on-year increase.
Korea and Singapore Lead Investment Inflows
Among 55 countries and territories investing in Vietnam in January, the Republic of Korea emerged as the top investor, pouring over $1.25 billion into the country—a 13.4-fold increase from the previous year. Singapore followed closely with $1.24 billion, reaffirming its strong investment presence. Meanwhile, Japan, China, and Hong Kong (China) rounded out the top five investors.
China led in the number of new projects (30.1%), while Korean investors dominated in capital adjustments and share purchases (25.4%), reflecting a diverse and evolving investment landscape.
Key Investment Destinations: Bac Ninh, Dong Nai, Hanoi, and Ho Chi Minh City
Vietnam’s northern and southern economic hubs remained the most attractive destinations for FDI. Bac Ninh province led with $1.39 billion in investment, accounting for 32.2% of the total FDI inflow—a 6.1-fold increase year-on-year.
Dong Nai province ($959 million, 22.1%) and Hanoi ($716.4 million, 16.8%) followed closely, maintaining their status as key investment hubs. Meanwhile, Ho Chi Minh City continued to attract the highest number of new projects (35.5% of total), capital adjustments (19%), and share purchases (64.2%), reinforcing its reputation as Vietnam’s economic powerhouse.
A Positive Outlook for Vietnam’s Investment Landscape
Sophie Dao highlighted that Vietnam’s resilience, competitive labor market, and investor-friendly policies have positioned the country as one of the most promising FDI destinations in the region. With strong infrastructure development, digital transformation, and government reforms supporting foreign investment, she expects continued robust FDI growth in 2024 and beyond.
“Vietnam’s ability to attract high-quality investments, particularly in manufacturing, real estate, and high-tech industries, speaks volumes about its economic potential. We are seeing increasing interest from global investors looking to establish long-term partnerships in Vietnam,” Dao remarked.
With FDI inflows on an upward trajectory, Vietnam is well-positioned to strengthen its role as a regional investment magnet, driving sustainable economic growth and job creation for years to come.
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Source: Vietnam Insider