Martin Rama, an economic expert from the World Bank in Vietnam said there are two notable points in FDI activities in Vietnam in first months of this year. First, the country attracted a number of new investors, most of them were from the US and Europe. Second, many large scale projects, especially technological and infrastructure projects, were invested in the country.

According to the Foreign Investment Department under the MPI, among more than 400 foreign investment projects licensed in the first months of this year, many big projects were invested in remote and mountainous areas in the northern provinces of Thai Nguyen, Ha Giang, Cao Bang and Son La.

MPI Minister Vo Hong Phuc said Vietnam’s entry to the WTO has created a certain breakthrough in economic development, especially in investment. This can be seen in term of three main issues. First, after the country joined the WTO, many strategic investors, particularly multinational groups, came to Vietnam. Second, Vietnam’s export markets expanded. Third, when implementing WTO commitments, the financial market and stock market attracted huge investment capital into the country, helping the economy develop strongly in recent times.

Meanwhile, according to recent announcements by international non-governmental organisations in Vietnam such as the Republic of Korean Chamber of Commerce and Industry and the EU Chamber of Commerce, Vietnam’s current investment environment is really attractive to the international investor community.

Sean Hoy from the Irish Embassy in Vietnam said Vietnam is a prospective destination for businesses. “I hope that more Irish businesses will come here. I think that the private economic sector is developing and the Government should continue to support the sector by further improving the investment environment,” Mr Hoy said.

A series of fact-finding tours of German businesses recently showed that German businesses in particular and EU businesses in general are paying great attention to Vietnam. Some big German groups which are operating in Vietnam such as Metro, DaimlerChrysler, Siemens, DeutscheBang, Allianz and Bayer are planning to expand their investment.

An annual survey of Japanese companies which are operating in the region, conducted by the Japan External Trade Organisation (JETRO), said that Vietnam is considered the best investment destination in terms of profit prospect, advantages of investment and labour force. Vietnam is listed among the top three countries that Japanese companies expect to earn a big profit of 66.7 percent in 2007, the highest rate among ASEAN countries.

JETRO said that to attract foreign investment, high competitive ability is needed but it is not a sustainable factor. The most important thing is to create a favourable investment environment by improving the quality of supplied services, the legal system, infrastructure and labour training.

Regarding foreign investment capital, Minister Vo Hong Phuc said the country must improve the disbursement of committed capital, boost investment promotion, focus on big projects and grant licenses to potential projects to create the impetus for the coming years.

Head of the Foreign Investment Department under the MPI Phan Huu Thang said the Government had authorized the MPI to an issue decree in preparation for welcoming the second investment inflow into Vietnam. The draft decree aims to develop a favourable environment for foreign investors in line with international rules and Vietnamese law and policy, as well as the future orientation for attracting foreign investment. The decree must also outline possible obstacles to attracting foreign investment in order to help local authorities iron out the snag.