Singapore retains top investor ranking in Vietnam
HANOI - Singapore has been ranked as Vietnam's number one investor among the 60 nations and
territories now doing business in the country.
According to statistics from the Department of Projects Management (DPM), seven new Singaporean investment projects
worth more than a total of US$9.2 million were licensed in the first seven months of the year, taking the number of
Singaporean-invested projects operating in Vietnam to 240, with total pledges of more than $6.7 billion.
Singaporean investment in Vietnam has been increasing steadily and Vietnam joint venture projects with Singapore have
performed well.
According to officials from the DPM, which is run by the Ministry of Planning and Investment, Singaporean investment in the
form of joint venture enterprises are the most popular, with Singapore-invested joint venture enterprises accounting for 62
percent of the Singapore-invested projects currently operating in Vietnam and more than 88 percent of Singapore's total
investment.
Wholly-Singaporean-owned projects account for 31 percent and the rest is taken up by business co-operation contracts.
Joint-venture projects are the most efficient, with more than 40 percent of the registered capital being used, excluding the two
new urban projects in Hanoi and a resort area project in Da Lat. Meanwhile, in wholly-Singaporean owned projects, around
24 percent of the registered capital is being used.
Significantly, the revenues of joint-venture enterprises have risen above the $1 billion mark, whereas that of the other two forms
of investment is just more than $150 million. Also, joint-venture enterprises employ nearly 13,000 people.
Significantly, one laudable achievement in the trade relationship between Vietnam and Singapore is the development of the
Vietnam-Singapore Industrial Zone in Binh Duong Province.
Licensed in 1996, the zone has attracted about 30 foreign-invested projects worth a total of about $300 million.
However, experts say Singaporean investors have not performed as well as other investors from Japan, the Republic of Korea
(RoK) and Taiwan. This is due to the fact they invested heavily in real estate which has suffered from the economic downturn in
Vietnam.
At present, little work has been carried out on three big property development projects worth $3 billion, comprising two urban
area projects in Hanoi and the construction of the Da Lat-Dan Kia Resort Area.
Experts estimate Singaporean investment will increase further in the future but there will be no new investment projects in
property.
They say that Singaporeans are likely to invest in consumer goods for export, food processing, aquaculture processing and
services.
Experts say two-way trade between Vietnam and Singapore is likely to grow significantly this year. Singapore is currently
Vietnam's second largest customer and last year two-way trade reached $2 billion.
This is likely to increase this year, as it had already reached more than $2 billion by the end of July.
But the Ministry of Trade is concerned about the balance of trade, which is weighted in Singapore's favour, with Vietnam
exporting goods worth a mere $518 million in the first seven months of this year.
Trade experts say Singapore-invested enterprises should put more emphasis on manufacturing goods for export in an effort to
improve Vietnam's somewhat lopsided trade balance with Singapore.
Vietnam News Agency - August 18, 2000.
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