At a press conference on January 6, 2024, the General Statistics Office (GSO) announced that total realized investments across the economy in 2024 at current prices reached an estimated VND3,692.1 trillion, a 7.5% increase versus 2023. Among this, realized foreign direct investment (FDI) in Vietnam last year amounted to a record high of an estimated US$25.35 billion, up 9.4% from the previous year. The manufacturing and processing industry attracted US$20.62 billion, accounting for 81.4% of the total realized FDI, followed by the real estate business with US$1.84 billion (7.2%), while electricity, gas, steam, and air conditioning supply as a whole got US$1.07 billion (4.2%). However, calculations from Vietnam’s inter-industry balance table over different periods indicate that most final products from the manufacturing and processing industry (except for agricultural and seafood processing) had low spillover effects on added-value growth but high spillover effects on imports. This suggests that production in this sector was heavily dependent on assembly and processing rather than value creation. Focusing on increasing the GDP contribution of manufacturing and processing without improving its spillover benefits to other sectors means prioritizing quantity over quality in growth. This could hinder the development of other high-added-value, low-import-dependent sectors that contribute more […]