FDI disbursement hits five-year high

huong Tran

Binh Duong province leads FDI attraction in Q1 2022.

Disbursement of foreign direct investment to Vietnam rose by 7.8 percent compared to 2021 to USD4.42 billion in the first quarter of this year, a five-year record.

According to Vietnam General Statistics Office, 322 foreign projects were newly licensed with total registered capital of USD3.21 billion in the first quarter of 2022, up 37.6 percent in the number of projects but down 55.5 percent in capital year-on-year. Foreign investors poured USD1.63 billion into 734 deals, up 102.6 percent in value compared to the same period last year.

In the first quarter of 2022, given the difficulties caused by the Covid-19 pandemic, the State Bank of Vietnam continued to maintain the policy rate unchanged which created favorable conditions for credit institutions to further reduce lending rates and support the economic recovery. The insurance sector maintained stable growth. Premium revenue of the entire insurance market in the first quarter of 2022 was estimated to increase by 13 percent year-on-year, of which premiums from life insurance increased by 15 percent and the nonlife increased by 9 percent.

The stock market had positive prospects with market capitalization growth estimated to increase by 28 percent year-on-year. Average trading value per session in the first quarter of 2022 was VND31,409 billion (USD1.38 billion), up 18.1 percent year-on-year. There are 768 listed stocks and fund certificates, and 882 stocks on Unlisted Public Company Market or UPCoM. In the quarter, total means of payment increased by 2.49 percent compared to the end of 2022. Capital mobilized by credit institutions increased by 2.15 percent while credit growth reached 4.03 percent.

export turnover in the first quarter was estimated at USD88.58 billion, up 12.9 percent compared to the same period last year, of which foreign invested sector (including crude oil) was USD65.31 billion, accounting for 73.7 percent. Import turnover was estimated at USD87.8 billion, up 15.9 percent year-on-year, of which the FDI sector made up USD58.34 billion, an increase of 17.1 percent.

Among the 18 sectors receiving funds in the first quarter, processing and manufacturing took the lead with USD5.3 billion, accounting for 59.5 percent of total registered FDI. It was followed by real estate with over USD2.7 billion, making up 30.3 percent, science and technology (USD200.4 million), and power generation and distribution (USD194.6 million).

In the quarter, Singapore was Vietnam's leading foreign investor with nearly USD2.29 billion, making up nearly 25.7 percent of the total registered FDI. South Korea followed with more than USD1.61 billion or 18 percent, and Denmark with USD1.32 billion or 15 percent.