Hanoi (VNA) - Vietnam has become one of the world’s fastest growingeconomies since the country first opened up to foreign trade and investmentmore than three decades ago, with GDP last year being 12.5 times higher than in 2001 and growth averaging 7.26 percent from 2001 to 2010.

Thecountry’s success has been largely attributed to the effective attraction anduse of FDI, which has helped its economy create large numbers of jobs, boostState budget revenue, foster restructuring, and improve competitiveness.

Ministerof Planning and Investment Nguyen Chi Dung said FDI attraction laid the foundationfor the development of key industries such as telecommunications, oil and gas,electronics, chemicals, steel, automobiles, information technology, footwear,textiles and garments, and food processing.

It has alsoplayed a vital role in boosting productivity and exports, he said, adding thatthe foreign-invested sector contributes more than 70 percent of Vietnam’s totalexports.

Thecountry has so far attracted more than 370 billion USD in FDI, of which 58 percenthas been disbursed, since the Law on Foreign Investment took effect in December1987, paving the way for FDI attraction around the country.

FDI inflowsexceeded 38 billion USD in 2019, the highest in 10 years and up 7.2 percentagainst 2018. FDI disbursement stood at 20.38 billion USD, up 6.7 percentyear-on-year and a new record.

Due toCOVID-19, FDI in the first eight months of this year stood at 19.54 billion USD,down 13.7 percent year-on-year, a report from the Ministry of Planning andInvestment’s Foreign Investment Agency (FIA) revealed.

FDIcommitted to newly-licensed projects, meanwhile, rose nearly 7 percent to 9.73 billionUSD. The FIA attributed the increase in fresh FDI commitments in the period to aliquefied natural gas (LNG) plant project in the Mekong Delta province of BacLieu with capital of 4 billion USD, which accounted for 41.1 percent.

Additionalcapital to the tune of 4.87 billion USD went to 718 existing projects, up 22.2percent in capital but down 21 percent in project numbers. 

Accordingto the FIA, additional investment of 1.38 billion USD to a petrochemical complexin southern Ba Ria-Vung Tau province and 774 million USD to the West Lake urbanarea project in Hanoi contributed to the higher capital amount added toexisting projects.

This is acceptableagainst a backdrop of sharply weakening global investment and economicde-growths in many countries induced by the pandemic, FIA Director Do NhatHoang said.

Thereport showed that, in the first eight months of the year, Singapore retainedits position as Vietnam's largest foreign investor, with 6.54 billion USD,followed by the Republic of Korea (2.97 billion USD, or 15.2 percent) and China(1.75 billion USD, or nearly 9 percent).

A newwave of investment has emerged, bringing Vietnam fresh opportunities, Hoangcontinued, and the country must be fully prepared and have a comprehensive setof measures to translate these opportunities into reality.

ProfessorNguyen Mai, Chairman of the Association of Foreign Invested Enterprises(VAFIE), said Vietnam must work even harder to improve its business climate andhelp enterprises weather the COVID-19 crisis. He also advised the country toaccelerate promotional campaigns to attract FDI from internationally-renownedconglomerates, especially those with high-tech and financial strength from theUS, the EU, and Japan.

FormerFIA Director Phan Huu Thang suggested that, to attract FDI faster, Vietnam couldpromote foreign investment attraction via its network of diplomaticrepresentative offices overseas. At the same time, the Government shouldstreamline public administrative procedures for major projects and activelysupport foreign-invested enterprises by removing barriers to the capitaldisbursement process, he noted.

A workinggroup on promoting foreign investment was founded in June under a decision fromthe Prime Minister, led by Deputy Prime Minister Phạm Binh Minh.

It will bein charge of advising the Prime Minister on mechanisms, policies, and standardsin investment cooperation as well as solutions to capture investmentcooperation opportunities. It will act proactively in approaching andnegotiating with large and hi-tech corporations for cooperative projects formutual benefit.

Investmentpromotion activities will also be carried out to attract quality, large,hi-tech, and innovative projects that could create positive spillover effects andfavourable conditions for Vietnamese companies to participate in value chains,increase added value, and improve human resources quality./.