HO CHI MINH CITY, Feb. 7 (Xinhua) -- Vietnam will focus on attracting eco-friendly foreign direct investment (FDI) projects that are high-tech and consume low natural resources and energy, local media reported Friday, quoting officials from the Ministry of Planning and Investment (MPI) as saying.
According to MPI Deputy Minister Nguyen Van Trung, Vietnam must choose projects that were more suitable to its new development period, and at the same time, the country would also appeal for projects that are invested by small and medium-sized enterprises, local Vietnam News daily reported.
In 2013, FDI was a bright spot in Vietnam's economic picture, attracting more than 21.6 billion U.S. dollars, a year-on-year increase of 54.5 percent. Recently, amid the global difficult economic situation, domestic firms encountered challenges they had not faced since the country started its renewal, said the MPI official.
Statistics from the ministry showed that Vietnam recorded good results in attracting FDI, which made up 18 percent of the national gross domestic product (GDP). The FDI contributed between 64-67 percent of export revenue and 12-14 percent of national budget revenue while creating over 2 million jobs.
According to Minister of Planning and Investment Bui Quang Vinh, enhancing competitiveness in investment environment is very essential. Meanwhile, current obstructions in attracting FDI include weaknesses in infrastructure, unskilled labor force, slow development in support industry and shortcomings in institutions, policies and administrative procedures.
Vietnam has to compete with Thailand, Indonesia, Malaysia and other developing countries such as Myanmar, Laos and Cambodia, which are also experiencing improvement in the investment environment, said the MPI official.
Despite of that, Vietnam is an attractive place for FDI, since it had a stable political and social environment. Vietnam had road networks and rail systems linked with countries in the Greater Mekong Sub-region which lies on international aerospace and marine routes.
Vietnam has a large consumption market of 90 million people with increasing income and a linkage to the hundreds of millions in the Association of Southeast Asian Nations (ASEAN), China, Japan and South Korea.
Vietnam is presently negotiating a Trans-Pacific Partnership ( TPP) Agreement and free trade agreements (FTAs) with South Korea and the EU.
Since 1999, especially since the Law on Enterprises was introduced, domestic businesses have made new progress, conquering the market with effective management measures. In that context, FDI had risen and made a significant contribution to the national economy.
Recently, the Vietnamese government adopted a resolution to improve the efficiency of FDI attraction. Accordingly, the MPI has been working to finalize the legal framework on FDI, focusing on the amendment of the Law on Enterprises as well as other relevant documents. It also considers the decentralized mechanism in attracting FDI and reviews its investment promotion activities.
In January 2014, Vietnam attracted 397.1 million U.S. dollars in FDI, down 22 percent against the same period last year, according to the General Statistics Office on Friday.
Of the total amount, 211 million dollars came from 40 new foreign invested projects and the rest from six ongoing projects to expand investment.
During the month, processing and manufacturing industries made up 47.6 percent of the nation's total FDI, luring 189 million dollars, while the real estate sector accounted for 44.4 percent, attracting 176.3 million dollars, and other sectors shared the remaining 8 percent, with 31.8 million dollars.
The majority of January FDI capital came from South Korea (88.8 million dollars), followed by Malaysia (27.2 million) and France ( 19.5 million dollars).
Among 12 provinces and cities nationwide having FDI attraction in January, southern Ba Ria-Vung Tau province took the lead with 61.5 million dollars. It was followed by northern Thai Nguyen and Vinh Phuc provinces, with 31.3 million dollars and 31 million dollars, respectively.