1. Public Investment - Highlights of the Vietnamese Economy 2023
Since public investment is considered a catalyst and resource for socio-economic development, this issue is always given special attention by the Government, ministries, branches, and localities, with a strong emphasis on promoting economic growth and supporting businesses.
In 2023, especially in the fourth quarter, the source of public investment has been directed by ministries and localities to expedite implementation and disbursement, accelerating the progress of key public investment projects, national importance, highways, inter-regional projects, and projects with spillover effects.
These efforts have been reflected in the estimated total disbursement of public capital in 2023, reaching 625.3 trillion VND, accounting for 85.3% of the annual plan and increasing by 21.2% over the previous year. This is also the highest level of public investment disbursement ever recorded.
Figure 1. Public investment disbursement over the 2019 - 2023 period (Thousand billion VND)
Despite the record-high disbursement of public investment in 2023, the overall implementation of public capital for 2023 has not yet achieved the targeted execution of over 95% of the plan, due to several difficulties that have not been fully resolved.
2. FDI - A record-breaking Achievement
Despite global uncertainty, FDI inflows to Vietnam continue to rise consistently due to the country's transparency and stability. Actual foreign direct investment in Vietnam is expected to reach 23.18 billion USD in 2023, a 3.5% increase over the previous year and the highest level since 2019.
As of December 20, 2023, total registered foreign direct investment in Vietnam had reached approximately 36.6 billion USD, a 32.1% increase over the prior year. New investment increased significantly in both capital (up 62.2%) and the number of new investment projects (up 56.6%), with a focus on provinces and cities with many advantages in attracting foreign investment, such as Ho Chi Minh City, Hai Phong, Quang Ninh, Bac Giang, Thai Binh, Hanoi, Bac Ninh, Nghe An, Binh Duong, and Dong Nai. In 2023, these ten areas accounted for 78.6% of new projects and 74.4% of total capital in the country.
In 2023, newly registered FDI inflows are expected to be 20.19 billion USD, while FDI disbursements are expected to be 23.18 billion USD, the highest amount since the 2019-2023 period.
Figure 2. Foreign Direct Investment registered in Vietnam as of December 20 in the 2019-2023 period (Billion USD)
Vietnam's FDI inflows are mainly from Asian countries, with a focus on manufacturing, processing, and assembling, which reached 19 billion USD (accounting for 82.3% of total investment); electricity, gas, water, steam, and air conditioning, which reached 1.3 billion USD (accounting for 5.9%); and real estate, which reached 1.1 billion USD (accounting for 4.9%).
With the results achieved in 2023, FDI inflows into Vietnam continue to reaffirm the crucial role in the country's socio-economic development. Following that growth, Vietnam is expected to be a hotspot for FDI in 2024, with a series of large projects pouring in, along with the potential for industrial production, processing, and manufacturing, especially in the fields of technology, electronics, and semiconductor production. However, opportunities also come with challenges, Vietnam needs to change the investment environment to retain large FDI investors; reform administrative procedures; support domestic enterprises to participate more deeply in the supply chains and production of FDI enterprises; improve the quality of human resources…
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