The need of the subject
Investment is crucial for socio-economic development, and Vietnam has seen positive economic changes through attracting and utilizing investment capital, particularly FDI FDI significantly contributes to the country's industrialization and modernization Attracting and utilizing FDI to exploit the inherent potential of localities, including Nghe An province, is an urgent requirement.
Nghe An province, situated in the North Central economic region, boasts an impressive average economic growth rate of 6.92% per year, surpassing the national average and making it an attractive destination for foreign investors The province has successfully executed its socio-economic development plan while maintaining political stability, transitioning from an agricultural economy to a more industrialized one, thereby contributing significantly to the national economy and enhancing the quality of life for its residents Despite these achievements, FDI attraction in Nghe An still faces shortcomings and unrealized potential, highlighting the need for improvement.
An province" luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Objectives of the research
Nghe An province's FDI attraction situation is analyzed and evaluated to identify key challenges Solutions are then proposed to address these issues and enhance the province's FDI attraction capabilities, aligning with SEO best practices.
Research method
In the research process, the author mainly uses these research methods: Data analysis, synthesis and comparison From there, give suggestions to improve the research problem
Systematization method: This method is used in the theoretical basis of the topic (chapter 1), thereby determining the content to focus on the research of the thesis
Statistical and comparative method: This method is used in the actual situation of FDI attraction in Nghe An province in chapter 2.
Scope of research
Space: Nghe An Province Time: From 2019 to 2021
Structure of the thesis
In addition to the introduction and conclusion, the thesis consists of the following three chapters:
LITERATURE REVIEW OF
Overview of foreign direct investment
According to Investopedia.com, an asset or object purchased with the intention of generating income or appreciation is referred to as an investment The term
Appreciation is the increase in an asset's value over time, representing a core investment goal of building future wealth Investments involve expending resources like time, money, or effort, with the expectation of a return that exceeds the initial investment.
Investment, as defined by the Investment Law (2014), encompasses various activities including establishing economic organizations, contributing capital, purchasing shares, engaging in contractual investments, and implementing investment projects, all aimed at conducting business activities.
Investing involves risk, with most investors preferring securities with lower risk levels to protect against potential losses and delays in payments.
(ii) Expectation of Return: The primary goal of investment is to generate a profit Investors anticipate substantial and consistent income from their money on a regular basis
Investors prioritize the safety of their principal, seeking assurance that their initial investment will be protected and that they will receive the expected return.
Liquidity is the ease of converting an investment into cash without loss, making liquid investments favored by most investors.
(v) Marketability: Another property of investments is that they can be sold It refers to the ability to buy and sell securities in the market
(vi) Stability Of Income: Investors put their money in with a high anticipation of profit As a result, the return on their investment must be adequate and consistent
Foreign investment, as defined by Vietnam's Law on Investment (2005), involves foreign investors contributing capital in cash or other lawful assets to conduct investment activities in Vietnam, driven by differing capital needs and the pursuit of advantageous business locations Diverse global investment flows exist, including those from industrialized to developing nations and among developed countries and large international corporations.
Foreign investments can be classed into two types: direct and indirect:
Foreign direct investments (FDI) involve physical investments made by a firm in another country, such as opening a branch and purchasing buildings, machineries, factories, and other equipment These investments are favored for their long-term nature, which strengthens the recipient country's economy.
Foreign indirect investments (FII) involve corporations, financial institutions, and individual investors purchasing holdings in foreign entities These investments are considered indirect because the investor does not directly control the foreign entity's operations or management.
Foreign portfolio investment (FPI) involves acquiring positions in foreign enterprises traded on a foreign stock exchange, offering the advantage of quick liquidation Indirect investments encompass both equity assets like stocks and debt products such as bonds.
Foreign Direct Investment (FDI) is defined by the International Monetary Fund (1993) as an investment aimed at obtaining a lasting interest in an enterprise in another economy This lasting interest signifies a long-term relationship and significant influence by the investor on the enterprise's management The element of influence and control distinguishes FDI from portfolio investment.
Foreign Direct Investment (FDI), as defined by the OECD (2008), involves cross-border investments where a resident of one economy seeks to establish a lasting interest in an enterprise within another economy, driven by a strategic, long-term relationship aimed at influencing the management of the foreign enterprise.
2008) luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Foreign direct investment (FDI) involves a foreign investor contributing substantial capital to a manufacturing or service sector, enabling their direct participation in the management of the investment, according to UNCTAD's World Investment Report (1999) This form of international investment allows for ongoing involvement in the object of investment.
INCOTERMS (2010) defines Foreign Direct Investment (FDI) as a component of national accounts, specifically an investment in foreign assets, excluding stock market investments FDI is generally considered a more stable investment for the host country compared to stock investments, as it tends to remain even during economic downturns, offering a more reliable source of capital.
According to Hill (2014), “FDI occurs when a business directly invests in the means to produce or sell a product in another country”
From the above concepts, the thesis will use the most concise and accessible understanding as follows:
Foreign Direct Investment (FDI) involves transferring capital and assets from one country to another for production and business activities FDI represents a long-term investment where foreign entities invest capital, directly manage operations, and generate profits through specific projects.
FDI distinguishes itself from general investment activities through the diverse nationalities of its investors These investments are project-based and governed by the host country's investment laws, ensuring compliance and regulation.
1.1.2.2 Characteristics of foreign direct investment
Impact of foreign direct investment
Foreign direct investment leverages existing strengths, enhancing project success through direct foreign participation in management This increasingly vital investment type significantly contributes to economic development in both investing and host countries due to associated benefits.
When investing abroad, investors will receive the following benefits:
Investors capitalize on host countries' comparative advantages to reduce production costs by leveraging disparities in production capacity and establishing businesses in low-cost areas, while also exploiting abundant and cheap labor resources to enhance competitiveness and improve investment returns.
FDI enables developed nations to relocate outdated machinery to less developed countries, extending its usability Investors seek foreign markets when domestic markets are saturated, resources are limited, and equipment becomes obsolete Expansion through FDI provides businesses with a monopolistic edge by granting access to unique technical resources, incentivizing capital investment.
Thirdly, FDI helps investors to penetrate the market with higher profit margins luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Investors seeking optimal returns should diversify beyond saturated markets As profit rates in specific regions diminish after reaching a peak, the focus shifts towards identifying new markets that promise higher profit margins and greater investment potential.
Foreign direct investment (FDI) helps investors circumvent trade barriers, particularly tariffs, which can impede the competitiveness of imported goods FDI serves as a strategic tool to amplify economic influence, enhance market presence, and streamline market entry, ultimately lowering costs and mitigating obstacles in product distribution.
FDI enables investors to mitigate risks during economic instability and facilitates effective shifts in a country's economic structure, aligning it with regional labor divisions This leads to increased profits from international business activities and enhances the promotion and expansion of a company's brand and products.
FDI's most significant drawback for the home country is the potential **domestic investment capital deficit**, which occurs when outbound investments reduce available funds for local development and job creation.
Foreign direct investment (FDI) introduces crucial resources for socio-economic advancement, notably capital, advanced technology, and refined management expertise.
Economic growth and development are crucial goals for all countries, especially developing ones striving to escape the vicious cycle of poverty A key strategy for these nations to break free involves increasing economic capital.
In developing countries, while Official Development Assistance (ODA) contributes to investment capital, it is often insufficient, highlighting the crucial role of Foreign Direct Investment (FDI) in supplementing economic capital.
Foreign-invested enterprises offer distinct advantages to host countries, primarily through tax revenues and investor accountability These benefits arise because foreign investors are fully responsible for their business operations Global foreign direct investment (FDI) flows are subject to significant fluctuations.
Due to the promotion of comparative advantages of each country, this capital flow is tending to flow strongly into developing countries that have advantages in natural resources, labor, etc
In developed countries, Foreign Direct Investment (FDI) serves as a crucial capital source, highlighting a trend where these nations are both significant investors and primary recipients of FDI Developed countries strategically attract FDI not for capital or technological deficiencies, but to foster deeper technological exchange and collaboration.
FDI contributes to promoting the development of science and technology in the host country, through the process of technology transfer
For developed countries, technology transfer, even if it involves older technologies, represents a significant advancement.
Foreign direct investment (FDI) enhances production and business efficiency, boosting labor productivity FDI reduces investment costs for host countries and positively impacts the economy, science, and technology.
Technology transfer is crucial for developing countries seeking to enhance productivity by overcoming limitations in capital and research capabilities, offering a cost-effective alternative to importing advanced technologies.
Factors affecting the ability to attract foreign direct investment
Foreign investment in developing countries hinges on both economic and political factors, with macroeconomic and political stability being paramount Studies indicate a strong correlation between political stability and the ability to attract foreign investment A government's commitment to open and consistent policies is also crucial for fostering investor confidence.
Trade policy has a great influence on the decision to choose an investment location because FDI is associated with the production and consumption of goods and services
Countries adopting import substitution strategies initially attract Foreign Direct Investment (FDI) into consumer goods production for domestic markets A nation's continued attractiveness to FDI diminishes without policy adjustments over time.
Privatization policy includes equitization and resale of companies, offering foreign investors increased opportunities and choices, especially in countries that permit their participation.
Monetary and tax policies significantly influence economic stability by affecting inflation, budget balance, and interest rates, which in turn impact the cost of capital and foreign investment income Corporate income tax directly affects FDI project profits, while income and consumption taxes influence product prices; generally, investors prefer countries with lower taxes.
The exchange rate policy significantly influences domestic asset prices, investor profits, and export competitiveness, thereby affecting Foreign Direct Investment (FDI) A weak national currency policy can attract foreign investment and boost exports, impacting economic sectors and regional development.
Labor policy: whether or not to restrict the use of foreign workers, giving priority or not giving priority to domestic workers
Education, training, and health policies significantly influence the quality of labor available for Foreign Direct Investment (FDI) projects International agreements and regulations increasingly favor FDI by protecting investor interests and aiming to eliminate nationality-based discrimination.
1.3.2 Economic factors v Market size luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Market size and expansion potential are crucial criteria for attracting foreign investment, with GDP often serving as a key indicator of economic size Studies suggest that FDI is influenced by the market size of the recipient country, as multinational corporations often establish factories based on import substitution tactics to maintain or expand market dominance GDP growth is also a positive indicator for attracting FDI, and investors often target areas with high prospects of rapid growth and potential to expand into surrounding markets, as well as densely populated regions.
In the era of globalization, while profit maximization drives multinational corporations (MNCs) to expand abroad, short-term profitability is not always the primary consideration due to various cost factors.
MNCs invest in countries to capitalize on opportunities and cost benefits, with labor costs being a critical factor in investment decisions Developing countries have leveraged cheap labor to attract foreign direct investment, but investment tends to fall as labor costs rise Foreign direct investment also enables businesses to reduce transportation expenses, enhancing their competitiveness.
Transnational enterprises' investment incentives are critical to avoid the impact of tariff and non-tariff barriers, with direct influence over raw material supplies, investment, and tax breaks Geographical location, low labor costs, and the domestic market are key factors influencing foreign investment appeal, as seen in the Philippines Cheap labor costs, advantageous investment conditions, and natural resources are primary drivers attracting international investment to Thailand.
The advantage of geographical location helps to significantly save transportation costs, easily open expanding to surrounding markets, effectively exploiting human resources and promoting centralized enterprises v Human resources
MNCs investing in developing countries seek to leverage young, abundant human resources, readily meeting unskilled labor demands Qualified managers and experienced technicians are typically concentrated in urban centers Employee motivation and work ethic are key factors in selecting investment locations, alongside the availability of natural resources.
Malaysia's abundant and inexpensive raw materials, particularly its rich natural resources, serve as a significant positive factor in attracting foreign direct investment (FDI).
28 abundant resources of oil, gas, rubber, wood Especially in Southeast Asian countries (ASEAN), exploitation of natural resources has been an important goal of many MNCs in the past decades
Industrialization and robust technological infrastructure significantly influence foreign investment flow Foreign investors require a comprehensive technical infrastructure, including transportation, energy, communication networks, and supporting services like banking and auditing.
The investment environment will suffer if these operations do not receive the necessary backing v Social infrastructure
Social infrastructure, encompassing healthcare, education, and cultural values, significantly shapes investment attractiveness Political and economic stability in Southeast Asia, as highlighted by UNDP/World Bank research, has positively influenced investment trends in the region.
Criteria for evaluating the effectiveness of FDI attraction
Criteria to asses scale of attrated FDI include: a About scale:
Number of projects Amount of registered capital Amount of capital realized Ratio of realized capital to registered capital Average capital size of each project b About quality:
Structure of FDI projects and registered FDI capital, implemented FDI capital according to the average investment capital size of each project
Structure of number of FDI projects and registered FDI capital, realized FDI capital by investment country and territory
Structure of FDI projects and registered FDI capital, implemented FDI capital by industry, production - business and service sectors
Structure of number of FDI projects and registered FDI capital, implemented FDI capital by industries, priority and non-priority sectors
Structure of the number of FDI projects and registered FDI capital, FDI capital implemented in the form of investment related to technology transfer
Structure of FDI projects and registered FDI capital, implemented FDI capital by territories and industrial zones
Number of projects and investment capital in the high-tech field
Amount of annual reinvestment capital of FDI projects luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
SITUATION OF ATTRACTING FDI
General overview of Nghe An province
Nghe An province, the largest in Vietnam's North Central region with a population exceeding 3.547 million, possesses significant potential for attracting foreign direct investment Consequently, numerous domestic and foreign investors are exploring business opportunities in Nghe An.
Nghe An, situated in the heart of North Central Vietnam, shares borders with Thanh Hoa to the north and Ha Tinh to the south It also has a 419 km border with Lao People's Democratic Republic to the west and boasts an eastern coastline.
Nghe An's 82 km coastline strategically positions it as a vital link in the North-South economy, fostering marine economic development and international cooperation Situated along key North-South transportation arteries, including 91 km of National Highway 1A and the Ho Chi Minh Road, Nghe An facilitates trade and connectivity.
132 km long, passing through districts of Quynh Luu, Nghia Dan, Tan Ky, Anh Son, Thanh Chuong and Thai Hoa town; National Highway 15 in the west is
The 149 km long national highways traverse the province from east to west, establishing a crucial connection with Laos through border gates.
7 is 225 km long, Highway 46 is 90 km long, National Highway 48 is over 160 km long) The province has a 94 km long North-South railway running through
Nghe An province is divided into diverse administrative regions, featuring Vinh City as a Grade 1 urban center, alongside the towns of Cua Lo and Thai Hoa The province encompasses 17 districts, which include 10 mountainous districts such as Thanh Chuong, Ky Son, and Tuong Duong, and 7 delta districts, including Do Luong, Nam Dan and Hung Nguyen, reflecting the region's varied geography and administrative structure.
Nghe An is located in the East - West economic corridor connecting Myanmar
- Thailand - Laos - Vietnam - the East Sea along Route 7 to Cua Lo port The province is located on national and international tourist routes
With a convenient location, Nghe An plays a key role in the economy, trade, tourism, and the transit of products throughout the country and the region,
Picture 2.1: Map of Nghe An province luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
37 particularly with Laos, Thailand, and China This is an advantageous situation for attracting investment in socio-economic growth
Nghe An, situated in the Northeast of the Truong Son mountain range, features a diverse and complex topography shaped by hills, mountains, and a network of rivers and streams The terrain generally slopes from northwest to southeast, creating three distinct ecological zones: mountainous, midland, and coastal plain Mountainous regions constitute 83% of the province, characterized by steep slopes, with nearly 80% of the land exceeding an 8° incline and over 38% surpassing a 25° slope.
Nghe An Province exhibits significant topographic diversity, ranging from the highest peak at Pulaileng (2,711m) in Ky Son district to the lowest plains in Quynh Luu, Dien Chau, and Yen Thanh districts, with elevations as low as 0.2m above sea level.
Topographical challenges hinder road network and forestry development in midland and mountainous areas, while the high slope river system with numerous waterfalls presents significant hydroelectricity potential and water source regulation.
Nghe An experiences a tropical monsoon climate with distinct hot, humid summers from May to October and cold, less rainy winters from November to April The average annual temperature ranges from 23 to 24°C, with significant temperature variations throughout the year.
The climate is characterized by hot summers, with average temperatures reaching 33°C from June to July and absolute highs of 42.7°C, while the coldest months, from December to February, average 19°C, with absolute lows dropping to -0.5°C; the area receives an average of 1,500 to 1,700 sunshine hours annually and rainfall ranging from 1,200 to 2,000 mm per year.
Nghe An Forest exhibits characteristics typical of Vietnamese woods, containing 986 species of woody plants across 153 families and 522 genera, according to data, not including herbaceous, climbing, and inferior species The Red Book of Vietnam lists 23 woody species found here.
Nghe An boasts diverse herbaceous species and forests in its hilly terrain, featuring evergreen forests below 700m and mixed coniferous forests above This forest is a crucial resource for raw materials and industrial growth, holding approximately 52 million m³ of timber, including 42,500,000 m³ of Pomu wood, and over 1 billion bamboo, cork, and meter trees.
Nghe An's diverse topography and biological environment foster a vast array of wildlife, with 241 identified species categorized into 86 families and 28 orders.
64 species of mammals, 137 species of birds, 25 species of reptiles, 15 species of amphibians, 34 species of mammals, 9 species of birds, and 1 species of fish are recorded in Vietnam's Red Book
UNESCO has recognized the western Nghe An biosphere reserve, including Pumat National Park, as a natural reserve.
Pu Huong Nature Reserve, with an area of 93,523 ha, and Pu Hoat Nature Reserve, spanning 34,723 hectares, are rich in rare and valuable flora and fauna, holding significant eco-tourism potential across nine mountainous districts.
Incentive policies to attract FDI
2.2.1 Incentive policies to attract FDI in Vietnam
Vietnam's economic liberalization and favorable investment policies are attracting significant foreign investment, serving as a catalyst for economic growth and technological modernization These policies aim to develop a highly qualified workforce, contributing to the recent benefits observed in the Vietnamese economy through its investment attraction program.
Attracting foreign investment is codified in key legal documents such as the Investment Law 2014 and the Law on Enterprises.
Income Tax 2008 amended and supplemented in 2013), Import and Export Tax Law 2016, and other guiding documents
Current FDI incentives include import tax exemptions/reductions, corporate income tax breaks, and preferential land lease prices, determined by specific project criteria.
Investors in projects located in areas with difficult or extremely difficult economic conditions, certain industrial parks, economic zones, and high-tech industrial parks will receive investment incentives.
Second, based on the business sector The State's policy has stipulated that a number of industries when foreign investors invest in Vietnam will enjoy investment incentives or special investment incentives
Third, based on the number of jobs created For example, investment projects in rural areas that employ 500 or more employees will enjoy preferential policies
Investment incentives are determined by the total investment capital, such as large-scale projects with an investment of \$$6,000$$ billion VND or more, meeting specific conditions.
In short, investment incentive policies also contribute to economic development in Vietnam, encouraging investors to invest in difficult areas and areas in Vietnam
2.2.2 Incentive policies to attract FDI in Nghe An province
Aggressively approach and connect with large investors, focusing on attracting investment in industrial growth to boost economic development.
48 infrastructure investors to industrial clusters are significant goals in Nghe An's foreign direct investment promotion in 2021
Nghe An province's Decision No 686/QD-UBND greenlights the 2021 Investment, Trade, and Tourism Promotion Program, emphasizing safe and effective activities with a flexible structure to transform Nghe An into a [insert desired outcome/destination].
"attractive, safe, and effective investment destination," with the dual aims of socioeconomic development and disease control in the current circumstances
Nghe An province aims to attract significant investors and supply chains to boost new investment capital flows in 2021 The province is focusing on expanding industrial growth and encouraging infrastructure and secondary investor engagement in industrial clusters.
The province has totally overhauled investment promotion activities in order to strengthen promotion staff capacity, professionalize, and modernize investment promotion styles, methods, and operations
Furthermore, actively updating modes of investment promotion via electronic media such as television, the internet, and social networks, and moving toward digitizing information to produce significant communication impacts
In addition, continue to promote communication with organizations and enterprises in order to build knowledge about the position, role, and efficacy of investment promotion activities Specifically: v Administrative procedure reform
Nghe An province has focused on administrative procedure reform to significantly enhance the quality and efficiency of administrative procedures.
49 fulfill the needs of businesses, improve the investment environment, boost competitiveness, and provide an open and most advantageous environment for investors to participate in commercial activities
The province is streamlining administrative procedures across all departments through Project 30, simplifying processes to save time for businesses and individuals Simultaneously, the province is focused on implementing governmental decisions aimed at strengthening the business environment and national competitiveness, alongside investment promotion activities.
The province strategically directs annual Investment Promotion Plans and fosters collaboration with regional provinces and cities to boost economic growth Provincial leaders actively engage with domestic and foreign firms, while hosting investment and trade promotion conferences to attract investment capital, enhancing the region's economic landscape.
The province has focused on attracting new investment projects, mainly in approved industrial and economic zones such as North-South Industrial Park, VSIP Industrial Park, and WHA Industrial Park, in recent years.
The situation of attracting FDI in Nghe An
2.3.1 Total value of FDI 2.3.1.1 Accumulated FDI
Table 2.4: Total accumulated FDI attraction in Nghe An province in the period of 2017-2020
(Source: Statistical Yearbook of Viet Nam)
From 2017 to 2020, Nghe An province saw an increase in accumulated Foreign Direct Investment (FDI), reaching \$1845.6 million in 2018 from \$1820.9 million in 2017 Between 2018 and 2020, the province experienced a sharp 32% increase in FDI, totaling \$2437.2 million, signaling its growing appeal as an attractive investment destination for foreign investors.
Year Number of projects Total accumulated FDI capital (Million USD)
2020 105 2437.2 luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Figure 2.3: Total accumulated FDI attraction in Nghe An province in the period of 2017-2020
In 2019, Nghe An province's total accumulated FDI capital reached \$2158.2\$ million USD, significantly lower than Thanh Hoa and Ha Tinh provinces, which reached \$14191.2\$ million USD and \$11729\$ million USD, respectively.
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Figure 2.4: Total accumulated FDI in 2019 of Thanh Hoa, Nghe An, Ha
(Source: Statistical Yearbook of Viet Nam)
Nghe An province is emerging as a region with untapped potential for Foreign Direct Investment (FDI) Despite its inherent advantages, the total accumulated FDI in Nghe An remains disproportionately low, indicating a significant opportunity for growth and investment.
Table 2.5: Newly attracted FDI in Nghe An province from 2017 to 2020
(Source: Statistical Yearbook of Viet Nam)
Thanh Hoa Nghe An Ha Tinh
Year Total new attracted FDI capital (Million USD)
2020 279 luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
The chart illustrates foreign direct investment (FDI) trends from 2017 to 2020, highlighting a sharp decrease in FDI attraction in 2018 compared to 2017 By 2019, committed investment capital reached \$315.7 million USD.
Figure 2.5: New FDI attraction in Nghe An province from 2017 to 2020
Despite the challenges posed by epidemics and natural disasters in 2020, Foreign Direct Investment (FDI) inflows experienced only a slight decrease, reaching \$279 million Key projects contributing to this investment included a \$100 million electronic product manufacturing facility at WHA Industrial Park, Mergy & Luxshare Vietnam Co., Ltd in VSIP Industrial Park (US\$40 million), and a \$9.47 million heavy calcium carbonate powder production factory by Yabashi Industry Joint Stock Company in Hoang Mai II Industrial Park.
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Table 2.6: Foreign direct investment capital in Nghe An province in 2020 by major investment partners
(Source: Department of Planning and Investment of Nghe An province)
Hong Kong, Korea, and China lead investments in Nghe An province, with \$140, \$118.07, and \$102.07 million USD respectively, while Thailand and Singapore have lower investments at \$92.2 and \$76.7 million USD.
Nghe An province's Southeast Economic Zone is emerging as a magnet for foreign investment, particularly in industrial park infrastructure, attracting notable partners like VSIP (Singapore) and WHA Hemaraj (Thailand) This open policy has yielded significant results, with the zone securing 08 FDI projects worth VND 6,718 billion in 2019, representing 88% of the total registered investment capital, solidifying its position as a key investment destination.
Figure 2.6: Foreign direct investment capital in Nghe An province in
Southeast Nghe An Economic Zone has emerged as a significant investment hub, drawing substantial foreign direct investment (FDI) With 43 FDI projects, the zone boasts a total investment capital of 15,820 billion VND, highlighting its economic potential Thailand leads as a major investor with 9 projects, followed by China with 8, and Korea and Japan each contributing 5 projects, showcasing diverse international interest.
Foreign direct investment (FDI) in Nghe An province is highlighted by projects such as the Luxshare-ICT project from Hong Kong's Luxshare ICT Nghe An Co., Ltd., the VSIP Nghe An Industrial, Urban and Service Zone project by Singapore's VSIP Nghe An Co., Ltd., and the WHA Industrial Zone -1 Nghe An Industrial Park project by Thailand's WHA Industrial Zone Nghe An Joint Stock Company.
Korea China Thailand Singapore Hongkong
Foreign direct investment capital in Nghe An province in 2020 by major investment partners luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Table 2.7: Form of foreign direct investment of projects in Nghe An province in the period 2017-2020
(Source: Socio-economic report of Nghe An province from 2010 to 2020)
In 2020, Nghe An province attracted \$2432.2\$ million USD in committed investment capital across 105 projects, predominantly through 100% foreign-owned ventures, with 103 projects of this type and only 2 joint venture projects.
2.3.4 Structure of FDI attraction by economic sectors
Table 2.8: Structure of FDI attraction by economic sector in Nghe An province in 2019
(Source: Department of Planning and Investment of Nghe An province)
Nghe An province sees uneven FDI distribution, heavily skewed towards the industrial sector, which accounts for approximately \$1394 million, or 64.77% of the province's total investment Key investment areas include food processing, medical tool production, electrical equipment manufacturing, and forest product processing.
NO Investment fields Number of projects Total capital (Million USD) Proportion (%)
Total 95 2152.2 100% luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Figure 2.7: Structure of FDI attraction by economic sector in Nghe An province in 2019
Nghe An province identifies tourism as a potential strength, boasting a rich culture, diverse ethnic identities, and stunning natural landscapes, including Cua Lo beach and historical sites like President Ho Chi Minh's hometown; however, the tourism sector ranked second in attracting investment, securing 15 projects with \$499.1 million, accounting for 23.19% of total investment, signaling an area ripe for increased foreign investment in the near future.
The agricultural sector attracts \$259.1 million USD across 10 projects, representing 12.04% of total investment, primarily focusing on processing agricultural crops, capitalizing on the province's strengths.
Industrial Agriculture Services luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
Figure 2.8: New foreign direct investment projects licensed in Nghe An province in the period of 2017-2020
The chart depicts the number of newly registered FDI projects from 2017 to
2020 In general, 2019 was the year with the largest number of registered projects with 11 projects, while 2017 had the lowest number of registered projects with only 4 projects
2.3.6 Total investment capital for implementation of foreign direct investment projects in Nghe An province
Table 2.9: Total investment capital for implementation of foreign direct investment projects in Nghe An province in the period of 2018-2020
Percentage of total registered investment capital 46.84% 53.58% 55.99%
(Source: Department of Planning and Investment of Nghe An province)
Total investment capital for implementation in 2019 of FDI enterprises in the province was estimated at 1156.3 million USD, up 6.74% over the same period
2017 2018 2019 2020 luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si
In 2018, foreign direct investment (FDI) enterprises realized \$59 billion, representing 53.58% of total registered investment capital, with several projects like Goertek VN and Haivina Kim Lien factory being implemented quickly While many projects were completed and operational in 2019, some large-scale projects are significantly behind schedule.
Despite increased investment attraction in 2020, the disbursement of foreign investment projects yielded positive outcomes FDI enterprises in the province saw a total realized investment capital of \$1364.6 million USD in 2020, a 2.41% increase compared to 2019 This brought the total realized investment capital of FDI enterprises in the province to 55.99% of the total registered investment capital.