Foreign investment powers national economy into globalisation

The September 7 event was jointly held by the Ministry of Science and Technology (MoST) and the Ministry of Planning and Investment to mark 35 years of Vietnam’s foreign investment attraction.

Deputy Minister of Planning and Investment Tran Duy Dong highlighted foreign investment’s positive impacts on the reform of economic institutions and the improvement of the domestic business environment, the State apparatus, and Vietnam’s reputation and position in the international arena.

The official cited statistics as showing that Vietnam has so far counted 38,084 valid foreign-invested projects with a total registered capital of 453.26 billion USD, of which nearly 287.1 billion USD has been disbursed.

In the first eight months of this year, the country attracted 1,924 new projects, while 830 others registered to adjust their investment capital, and 22,268 transactions of capital contribution for share purchases were recorded in the period with a combined value of nearly 18.15 billion USD.

Deputy Minister of Science and Technology Le Xuan Dinh called foreign investment a bright spot since Vietnam started to embark on reforms in 1986, adding that the source of capital has contributed to sharpening the national economy’s competitiveness, generating jobs and raising the State budget collection.

The official noted a string of policies adopted by the Party and the State to boost foreign direct investment (FDI) and improve its efficiency.

Vietnam has regarded science-technology and innovation as one of the most important strategic breakthroughs, Dong said, pointing to positive outcomes the country has recorded in luring foreign investment in this regard, with the presence of such tech giants as Intel and Samsung.

However, limitations still remain in technology transfer, said Dang Dinh Tung, deputy head of the MoST’s Department of Technology Appraisal, Examination and Assessment, elaborating that although there were 400 technology transfer agreements by FDI firms recorded in Vietnam between July 2018 and the end of 2022, they were only in the parent-subsidiary relationship, with no effects on others.

According to the MoST, among the more than 100 multi-national groups investing in the Southeast Asian nation, only Samsung and LG of the Republic of Korea (RoK) have built their research and development (R&D) centres in Hanoi.

Dong stressed that the competition pressure from FDI firms has prompted domestic businesses to raise their productivity and revamp technology, thus better adapting to the globalisation.

However, Vietnamese enterprises have not been able to absorb technologies from FDI firms yet, he said, proposing policies and mechanisms to link domestic and foreign enterprises, covering support industry development, and connectivity in product supply chains.

At the same time, domestic businesses need to proactively seek technology transfer channels, he said./.