Vietnam must capitalize on the trend of capital mobility

DNHN - Many significant multinational firms are extending their assets in Vietnam and scaling up their investment strategy. However, in the context of global issues, Vietnam's difficulty is determining how to capitalize on the opportunities presented by the trend of investment capital mobility.

Foreign firms encourage investment in Vietnam.

On September 2, Lotte (Korea) broke ground on the Lotte Eco Smart City Thu Thiem Smart Complex Project In Ho Chi Minh City in honour of National Day. The project will cost around 900 million USD and will have 5 basements and 60 stories with services such as a hotel, commercial space, and residential area...

Lotte has therefore made another step in its investment adventure in Vietnam, after previous investments in projects such as Lotte Center Hanoi, Lotte Hotel Saigon, Lotte Mall Tay Ho, Lotteria shop networks, and so on.

Mr Shin Dong Bin, Chairman of Lotte Group, stated that the groundbreaking Lotte Eco Smart City Thu Thiem would serve as the "beginning point" for Lotte's future investment efforts in Vietnam. This is especially significant given that 2022 marks the 30th anniversary of Vietnam-South Korea diplomatic relations. Korean investors stated that this is a chance for them to advertise their Vietnam investment intentions.

After the success of high-tech complexes in Bac Ninh, Thai Nguyen, and Ho Chi Minh City, Samsung has indicated that it will invest an additional $3.3 billion in 2022.

STS signed a memorandum of understanding with partners and the Long An provincial Department of Planning and Investment at the end of August on investment promotion and development of multi-purpose complex projects, comprising holiday villas, golf course, and resort..., on a size of 150 hectares. Foxconn had and continues to have fresh investment intentions.

ParkCity Property Holdings (Malaysia) has arrived in Long An with a proposal to invest in a 2,600-hectare urban and industrial complex project that includes a 36-hole golf course system. Mr Datuk Seri Yaw Chee Siew, Chairman of ParkCity Property Holdings, stated at a meeting with Long An provincial authorities that ParkCity aims to plan the creation of a long-term sustainable development complex to capitalize on the advantageous position between Long An and Ho Chi Minh City.

ParkCity also visited Da Nang at the end of June to seek for investment prospects. These measures demonstrate that, after successfully developing ParkCity Urban Area (Ha Dong, Hanoi), Malaysia's "big man" has made larger calculations in the Vietnamese market.

Vietnam’s expectations

Foreign "big boys" continue to express interest in the Vietnamese market, with many of them following through on their investment intentions.

According to Mr Philipp Rosler, former Executive Director of the World Economic Forum, Vietnam's inclusion in the consideration possibilities of global technology businesses is a "wonderful thing."

However, when reporting to the Government, Minister of Planning and Investment Nguyen Chi Dung stated that attracting foreign direct investment (FDI) is tough, with the amount of newly registered FDI capital in the first eight months of the year being just 56.1% of the same period last year. This has an impact on the FDI sector's capacity for production expansion, which can affect import-export turnover, current account, foreign exchange reserves, exchange rate, and so on in the medium and long term.Furthermore, FDI quality has been sluggish to develop, with a dearth of large-scale projects, current technology, high added value, tight links, and assistance for knowledge transfer to the local sector.

Meanwhile, Vietnam has high hopes for obtaining a lot of FDI while also becoming a large-scale project with cutting-edge technology. Global investment is suffering as a result of the Russia-Ukraine war and the reemergence of the COVID-19 epidemic. In that environment, Vietnam's challenge is figuring out how to capitalize on the potential presented by the trend of investment capital mobility.

PV