Mar 29, 2012

Vietnam - FDI inflow to real estate back on top


The foreign direct investment (FDI) inflow to the local property sector has regained the leading position in terms of fresh capital in the first quarter of 2012, after a long period of sharp decline due to the market woes.

Real estate accounted for 45.5% of the total registered capital in the year’s first three months, said the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment. This achievement is partially attributed to the US$1.2-billion Tokyu Binh Duong Garden City project developed by Becamex IDC and Japan’s Tokyu Corporation.

However, this does not mean the local property market is prospering.

The investor of the aforesaid project is aiming at the long-term target of the Binh Duong New City project. Therefore, the joint venture kicked off the project right on the day they received the investment certificate in early this March so as to promptly complete the 71-hectare project before Binh Duong becomes a centrally-governed city in 2020.

The billion-dollar Tokyu Binh Duong Garden City project helps take the total newly registered and additional FDI capital in the first three months of the year to some US$2.63 billion, equal to 63.6% of the same period last year.

As of March 20, there have been 120 fresh projects licensed nationwide worth US$2.26 billion, or 77.2% of the year-ago period. In the mean time, 29 operational projects registered to raise their investment capital by an additional US$368 million, 30.4% of the same period in 2011, said FIA.

Manufacturing and processing industries, which topped the list in the first two months, fall to the second place with 51 newly registered projects and 25 projects adjusting up capital worth US$1.17 billion in total, accounting for 44.6% of the total registered capital.

Transport and storage take the third position with US$180 million in fresh and additional FDI capital, or 6.8% of the total registered capital in the first quarter.

According to FIA, in the last three months, the foreign capital inflows to the big projects were mostly sourced from Japanese investors. Specifically, apart from the US$1.2-billion property project mentioned above, there are also a project worth US$574 million invested by the Japanese tire maker Bridgestone Corporation in the Haiphong-based Dinh Vu Industrial Park and the US$180-million project of Oshima Shipbuilding Co. Ltd.

With many large-scale projects, Japan has become the biggest foreign investor in Vietnam in the first quarter, with the newly registered and additional capital reaching US$2.3 billion, equivalent to 88.8% of the nation’s total.

The Netherlands ranks second with US$46.1 million, or 1.7%, followed by Taiwan with US$42.9 million, 1.6%.

FDI disbursement in the first quarter of the year also shows positive signs, said FIA. Particularly, FDI enterprises disbursed some US$1.52 billion in March, taking the total disbursement of the first three months to US$2.52 billion, or 99.2% of the year-ago period.

Saigon Times



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