High FDI attraction thanks to foreign retailers

This is also a good signal for FDI attraction in recent time, said the economist Pham Chi Lan. Vietnamese economy’s long term prospect is the main reason prompting foreign investors to pump capital here.

 

According to Pham Phu Ngoc Trai-general director of PepsiCo Indochina, after observing Vietnam’s economic situation, the global PepsiCo committed to invest trillions of dong in the country within next three years.

 

In early 2009, PepsiCo started operation of a $30 million facility capable of producing 40-50 million litres a year in Binh Duong southern province. In this month, the company will open a drinking producing factory in Can Tho City.

 

In addition to this, within one month, two hypermarkets invested by foreign giants recently were inaugurated. In Dong Nai, on July 9, Metro opened the ninth 20 million euro supermarket in Vietnam. Although not officially announcing the upcoming plan, vice chair of Metro Group appreciated highly the market and huge profitability in Vietnam, thus the tenth one is likely to come up soon. Similarly, Big C on July 13 also inaugurated a supermarket costing 300 billion dong in Hue, marking the ninth one of Big C in Vietnam. Previously, DHL delivery firm announced investing $10 million in a new joint venture in Vietnam and promised to open a consulting service provision centre in garment sector.

 

Regarding finance and banking sector, Prudential that contributed a good amount in Vietnam’s FDI attraction through its Vietnam arm has now announced to scale up the chartered capital from 370 billion dong to 615 billion dong. Meanwhile, HSBC has also put the Binh Duong branch into operation from July 1. The setting up of the subsidiary bank and network expansion of HSBC Bank (Vietnam) Ltd shows the bank’s belief and investment commitment in Vietnam’s long term economic development, Huynh Buu Quang-Senior vice President, Head of Commercial Banking Sector of HSBC Vietnam said in a statement.

 

HSBC now is the foreign bank with the most transaction sites in Vietnam, three branches in HCM City, Hanoi and Binh Duong and seven transaction offices in Hanoi and HCM City.

 

Ministry of Planning and Investment’s Foreign Investment Department reported that in Jan-June, 68 FDI projects (mainly of Korea, Japan and Singapore) were registered to increase capital with an extra amount of $4.1 billion, up 13.8 percent year-on-year.

 

Dr Nguyen Quang A, head of Institute of Development Studies (IDS) assessed that clearly, foreign investors are finding Vietnam’s economy attractive.

 

Nakanishi Hirota senior investment advisor at the Japan External Trade Organisation’s office in HCM City said that Vietnam’s FDI will surge in years to come. In June alone, one of Vietnam’s WTO commitments is to allow investors to set up the sales and distribution system to support their exports.

 

In his opinion, Vietnam will be one of key points in attracting FDI from now to the year end and in 2010. In the coming times, Vietnamese government should focus on developing support industries, infrastructure and the competitive strength of domestic market, he pointed out.