Reclaim the runner-up position

Specifically, according to information from the Foreign Investment Agency, as of August 20, the total newly registered capital, adjusted capital, and capital contribution and purchase of shares and capital contributions by foreign investors in Vietnam reached nearly 18.15 billion USD, an increase of 8.2% over the same period last year.

Of which, Hanoi is leading with a total registered investment capital of more than 2.34 billion USD, accounting for nearly 12.9% of the total registered investment capital, an increase of 2.89 times over the same period. Following that are the provinces and cities of Hai Phong, Ho Chi Minh City, Bac Giang, etc.

In terms of the number of projects, there were 1,924 new investment projects, up 69.5% over the same period, with total registered capital reaching over 8.87 billion USD, up 39.7% over the same period. Ho Chi Minh City is the leading locality in the country in terms of the number of new projects, adjusted projects and capital contributions to buy shares.

In particular, over the first 8 months of 2023, foreign investors have invested in 18 out of 21 sectors of the national economy. The processing and manufacturing industry is leading with a total FDI capital of nearly 13 billion USD, accounting for nearly 67.8% of the total registered investment capital and increasing by 14.7% over the same period. The real estate business is holding the second position with a total investment capital of more than 1.76 billion USD.

Previously, from April 2023, real estate business lost the second position in the ranking of sectors attracting FDI capital. However, since July, this industry has regained the second position.

FDI attraction comes from many types of real estate, including large-scale mergers and acquisitions (M&A) projects that have taken place in recent months. According to a recent report by the Vietnam Association of Realtors, foreign investors are maintaining their interest in domestic real estate projects in the first months of 2023. The level of interest has increased over time. Projects that have completed legal procedures are the target of many investors.

Foreign investors conducting M&A deals in Vietnam are mostly from Korea, Singapore, Japan, Taiwan, Malaysia, Thailand, etc. Meanwhile, Vietnamese enterprises often focus on small and medium-sized deals.

Which type is attracting strong capital?

Besides M&A deals, the type that is considered a bright spot in attracting FDI capital in the current period is industrial real estate. Not only in the current period but also since the beginning of the year, when the real estate market in general is extremely stagnant with frozen liquidity, industrial real estate is still developing with many positive indicators, being welcomed by many investors.

For example, in the first quarter of 2023, a delegation of 52 US businesses with many big names such as Boeing, Coca-Cola, Meta, SpaceX, Netflix, Apple... came to seek business and cooperation opportunities in Vietnam. This shows that Vietnam has the potential to become a new destination for many companies and corporations. At the same time, it is also a factor promoting the ability to attract capital for industrial real estate.

Talking about this type, many opinions say that with the increasing interest of domestic and foreign investors, the development of industrial real estate will continue to be vibrant in the coming time. Because this type is holding many advantages such as infrastructure, abundant labor resources, large land funds, strong support from investment policies...

At a recent industrial real estate forum, Mr. Bruno Jaspaert - General Director of DEEP C Industrial Park Complex said that Vietnam is seeing a steady increase in the number of investors over the years and if it continues to maintain this, there will be no limit to taking advantage of opportunities from new capital flows.

This expert also said that investors are currently receiving support from state agencies in investment policies and many very specific supports from local authorities. In addition, Vietnam is the most open country in Southeast Asia thanks to FTA agreements, bringing significant trade advantages, helping to increase market size for investors.

Next, land rental prices in Vietnam are still lower than in other ASEAN countries. The China+1 trend is also becoming an important channel for Vietnam, accounting for about 10% of manufacturing enterprises leaving China.

Finally, Vietnam's infrastructure spending is growing strongly. Currently, public investment in infrastructure accounts for 52% of the 2021-2025 public spending plan, and as infrastructure develops, the industrial sector will be one of the biggest beneficiaries.

In the coming time, this type is expected to continue to attract FDI capital and grow positively. However, there are still many existing problems that may arise in the future such as investment procedures, project legality, energy infrastructure, aging population, etc. These are challenges for this type in the process of attracting increasing FDI capital.