After declining in the first few months of the year, the inflow of foreign direct investment (FDI) showed a turnaround in July. What are the key factors behind the rebound of foreign funds, especially FDI, and will this trend continue in the coming time? Turnaround Fresh foreign investment approvals in Vietnam in the year to July 20, comprising fresh FDI, additional capital injected into operational projects, and portfolio investment, had amounted to US$16.24 billion, up 4.5% year-on-year. As such, after declining steadily in the first six months, with the amount updated to end-June still falling 4.3% year-on-year, the inflow of foreign capital made a sharp turnaround in July. However, the shrinking inflow of foreign capital in the year’s first half – contracting by a sharp 38% at one point – is largely attributed to a steep fall in additional funds into active FDI projects. This year through July has seen the additional funds into active FDI projects shrink by 42.5% to US$4.16 billion. However, the number of operational FDI projects injected with additional capital increased by 27.1% to 736, meaning the average additional capital for each project was far lower than that in previous years. As FDI generating countries abruptly […]
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