Hanoi (VNS/VNA) - Disbursement of foreigndirect investment (FDI) in the first nine months of this year reached 15.4billion USD, up 16.2 % year-on-year and marking a record high, a report fromthe Foreign Investment Department (FIA) has shown.

These positive figures showed that foreign-invested enterpriseshave been constantly recovering and expanding their production and businessactivities in Vietnam, FIA said in its report.

However, foreign investment inflows into Vietnam saw a yearlydecline of 15.3% to over 18.7 billion USD in the nine-month period.

Up to 1,355 new foreign-invested projects were licensed during theperiod with a total registered capital of 7.12 billion USD, up 11.8% in thenumber of projects but down 43% in terms of capital.

The agency attributed the decline in newly-registered capital todifficulties encountered by foreign investors in coming to Vietnam to exploreinvestment opportunities and fulfilling investment registration procedures inthe last months of 2021 due to the State policies on controlling the COVID-19pandemic. That have affected the number of new projects granted licences in thefirst months of 2022.

Also, the global market has been facing many fluctuations due tothe influence of the geopolitical conflict in Europe, high inflation pressure,and supply chain disruptions, which have been negatively affecting the outflowof foreign investment from major economies, especially investment partners of Vietnam.

FIA also named a lack of large-scale projects worth over 100million USD in the first months of 2022 compared to that of 2021 as one of themajor reasons. These projects including Long An 1 and 2 LNG power plants wortha combined over 3.2 billion USD and O Mon 2 thermal power plant valued at above1.3 billion USD contributed 62.3% of the total capital pledged in the ninemonths of 2021.

Meanwhile, the first nine months of this year saw fewforeign-invested projects with a scale of over 100 million USD, and these projectsaccounted for only 37.2% of the period's total registered investment capital.

In another bright spot, capital added by foreign businesses to 769operating projects in the country surged 30% to 8.3 billion USD. That hasdemonstrated their great confidence in Vietnam's economy and its investmentclimate, according to the agency.

Phan Huu Thang, Director of the Foreign Investment ResearchCentre, agreed. He told baodautu.vn thatthe success of the large-scale foreign enterprises in Vietnam would helpattract other ones to the country.

At the same time, foreign investor capital contributions and sharepurchases also recorded a yearly hike of 2% to 3.28 billion USD.

The processing and manufacturing sector lured the lion's share ofFDI with over 12.1 billion USD, accounting for 65% of the country's totalcapital.

Real estate came next with 3.5 billion USD or 18.7%. Science andtechnology and wholesale and retail were the runners-up with 677 million USDand 620 million USD, respectively.

Singapore remained Vietnam's leading source of foreign investmentwith above 4.75 billion USD, making up 25.3% of the total FDI registered in thecountry.

The Republic of Korea followed with nearly 3.8 billion USD or 20.3%, and Japanwith 1.9 billion USD or 10.2%.

The country's other major foreign investors were mainland China,Denmark and Hong Kong (China).

A survey conducted by the Ministry of Planning and Investment andthe Vietnam Business Forum Alliance (VBF) in September 2022 showed that over 90%of FDI enterprises achieved medium and high business efficiency and financialstatus.

Most surveyed businesses expressed their optimism and confidencein Vietnam and committed to continue to expand investment in the country. Ofthem, 66% said they planned to enlarge their investment scale in 2023.

According to FIA Director Do Nhat Hoang, Vietnam expected goodresults in FDI attraction in 2022 and following years when countries have beengradually opening up their economies and adapting to the new normal conditions.

In addition, many international corporations and businesses havebeen looking for investment locations to diversify their supply chains and Vietnamhas been evaluated by international organisations as an attractive and safeinvestment destination.

In the next two or three years, technology corporations stillprioritise Vietnam as an investment or expansion location, especially inmanufacturing and processing, technology pharmaceuticals and energy, Hoang told baodautu.vn.

In order to effectively catch up with this investment wave, Ministerof Planning and Investment Nguyen Chi Dung emphasised the importance ofpreparing an adequate source of land, perfecting infrastructure and betteringthe supply of energy and skilled labour.

Improving capacities of domestic enterprises so that they couldparticipate in value chains while drawing up incentives and investment supportpackages to negotiate with strategic foreign investors should also be included.

In the long term, it would also be necessary to improve thebusiness investment environment and speed up administrative reform, Dungsaid./.