Vietnam luring investment from Asian neighbours

09:50 | 25/01/2016 Economy

Capital from regional neighbours into Vietnam is increasing, the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment (MPI) said.

Vietnam luring investment from Asian neighbours

Workers at a foreign-invested company. (Photo: VNA)

ANA Holdings Inc, owner of Japan's biggest airline All Nippon Airways, will buy an 8.8 percent stake in national flag carrier Vietnam Airlines. Vietnam Airlines Chief Executive Officer Pham Ngoc Minh told Bloomberg on January 12 that the deal will close sometime between March and June.

On January 6, Singapore's Maple Co Ltd received an investment license to build a 110-million-USD garment factory in the Vietnam-Singapore Industrial Park in the northern province of Bac Ninh. The facility is expected to produce 22 million products per year when it comes into operation in 2018.

Malaysia's United More SDN.Bhd was also licensed on January 7 to build a 21- million-USD plant to make TV screen frames and plastic covers in the Saigon Hi-Tech Park. The plant is set to begin production in the second quarter, with an initial capacity of four million units per year.

Investments by Thai businesses have particularly been busy, according to the local press.

The Government's online newspaper, baochinhphu.vn, reported that Thai beer firm Singha Asia is expected to complete its 1.1-billion-USD purchase of Masan Group stakes in January.

With this deal, Singha will hold a 25 percent stake in Masan Consumer Holdings and 33.3 percent in Masan Brewery – units that own food and drink brand names such as Chinsu, Omachi, Vinacafe and Su Tu Trang (White Lion) Beer.

Last year, the Republic of Korea's LG Electronics, the world's second largest TV maker, decided to move its TV production facilities from Thailand to Vietnam to save costs and increase capacity.

The FIA said the Republic of Korea’s Government encouraged companies to invest in Vietnam during 2015, considering this a strategic investment destination. The encouragement came in the context that most of the Republic of Korea's leading businesses, including Samsung, Canon, POSCO, Hyundai and KEPCO, had already invested in Vietnam.

Official sources said Vietnam is now deeply integrated into 55 global economies, and it has slashed more than 90 percent of its tariffs to zero percent.

A recent Bloomberg report on growth prospects of 93 global economies forecast that Vietnam will grow by 6.6 percent in 2016, the second fastest after India with 7.4 percent.

Vietnam's growth was also expected to top Southeast Asia, higher than the anticipated 5.2 percent for Indonesia, 4.5 percent for Malaysia, 3.2 percent for Thailand and 2.3 percent for Singapore.

Economists said Vietnam should further improve its business environment and enhance labour productivity to take advantage of current capital flow tendencies, especially when foreign direct investments in the country reached a record high of roughly 23 billion USD last year./.

Source: VNA



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