10:35 | 11/06/2015 Investment
(VEN) - Vietnamese investment abroad has increased rapidly in recent years both in terms of investment areas and kinds of business.
Viettel is one of the strongest Vietnamese investors abroad
Investment abroad reached the US$20 billion milestone
According to the Ministry of Planning and Investment’s Foreign Investment Department, with 962 investment projects and total registered capital of US$15 billion abroad by the end of April. Of these, 115 projects have increased their capital by US$5 billion leading to total new and supplementary investment capital of US$20 billion.
Last year alone the country granted overseas investment certificates to 109 Vietnamese projects to invest total capital of more than US$1.047 billion in 28 countries and territories, while permitting 22 ongoing projects to increase their registered capital by US$739 million. Accordingly, total Vietnamese investment capital abroad reached US$1.786 billion in 2014.
The Ministry of Planning and Investment forecast that Vietnamese businesses would develop about 150 projects with total registered capital of US$1.5-2 billion abroad, of which US$1-1.2 billion would be disbursed this year.
Laos and Cambodia have received the highest interest from Vietnamese businesses. Specifically, they have launched 259 projects with total investment capital of US$3.9 billion in Laos accounting for 27 percent of total projects and 26 percent of total registered capital, and 171 projects with US$3.2 billion in Cambodia accounting for 18 percent of total projects and 22 percent of total registered capital.
Diversifying markets and investment areas
Vietnamese investment abroad has been persified. According to the Ministry of Planning and Investment, apart from major markets such as Laos and Cambodia, Vietnamese companies have invested in Myanmar, Russia, Australia and several countries in Africa.
Vietnamese investment abroad has also expanded to include traditional areas such as mining, agriculture, forestry and fisheries and new areas such as communications, power production, real estate, and finance and banking. Together with state-owned giants like Viettel, Vinamilk and the Vietnam Rubber Group, a lot of inpiduals and private enterprises have joined investment abroad such as FPT, BKAV, Hoa Sen Group and Kymdan. By 2014, 80 percent of Vietnamese projects abroad had been invested by inpidual investors and private companies.
The Ministry of Planning and Investment is evaluating Vietnamese investment abroad in order to submit Prime Minister Nguyen Tan Dung a scheme to boost Vietnamese investment abroad in the near future to achieve high efficiency.
Foreign Investment Department Head Do Nhat Hoang said that Vietnamese investment abroad has increased in recent years both in terms of quantity, investment areas and kinds of business.
This shows that Vietnamese businesses are becoming more dynamic in seeking opportunities in foreign markets. However, weaknesses exist. For example, a number of projects have not kept pace with the schedule, or have been terminated early, or have not brought about efficiency. Reasons vary including differences in terms of market, barriers in terms of language, culture and legal procedures, and economic and political changes in the host countries.
To improve Vietnamese investment abroad, the Ministry of Planning and Investment is further improving overseas investment bylaws and management models, simplifying administrative procedures, providing business with sufficient information and investment opportunities, while at the same time protecting their interest during investment and operations overseas.
By Nguyen Hoa