Singapore: Tops ASEAN investors in Vietnam

Another eight Singaporean projects were licensed to increase their capital by a total of US$13.3 million. This makes investors from Singapore the second biggest group of foreign investors in the country.

Between 1988, when Vietnam issued its first law on foreign investment, and now, Singaporean businesses have had 503 investment projects totaling US$9.6 billion in Vietnam, making Singapore first among ASEAN (the Association of Southeast Asian Nations) countries/territories and second among all foreign countries/territories investing in the country during that period.

Singaporean project capital averaged US$18.7 million, higher than the average of all FDI (foreign direct investment) projects in Vietnam and two to three times that of Korean, Chinese Taipei, Hong Kong and Malaysian projects.

The statistics also show that Singaporean investment was spread out among most industries in Vietnam, including oil and gas exploration and extraction, industrial production, and agricultural, forest product and seafood processing. Of the 503 Singaporean projects that have existed Vietnam, 207 (total capital US$5.5 billion) were in the service sector. This was 60.7 percent of all registered Singaporean investment capital in the country. Another 230 (US$3.3 billion) were in industry and construction (36.4 percent), and the remaining projects were in the agricultural and forestry sector.

Many Singaporean projects have operated at a profit, one of those, the Vietnam-Singapore Industrial Park (VSIP), being in existence now. This project is said to have been a joint idea of former Vietnamese Prime Minister Vo Van Kiet and former Singaporean Prime Minister Goh Chok Tong.

VSIP has completed the infrastructure on 600 hectares of the park. The VSIP authority said that 10 years after it started-up, VSIP had attracted 250 investment projects totaling US$1.7 billion, 165 of which were producing/trading some products/services, 30 were under construction and equipment installation, and 55 were fulfilling needed procedures to start up construction or production/trading. The 250 projects leased 97 percent of the IP's industrial area. Companies in VSIP have earned revenue of US$3.25 billion including US$1.62 billion worth of exports. The authority in charge wants to expand Vietnam-Singapore II Industrial Park and build two more industrial parks - one in Bac Ninh province and the other in Ha Nam province. Prime Minister Nguyen Tan Dung recently allowed the Vietnam-Singapore Joint Venture Company Limited to build a 700ha industrial park, urban area and service complex in Bac Ninh. This complex is to contain an industrial park on 500ha and an urban and service area on 200ha.

The Department of Foreign Investment said that Singaporean investors are now interested in infrastructure development in Vietnam and a large amount of Singaporean capital is going into home, office and hotel construction. When she recently spoke to the media, Chiong Woan Shin, the Trade Consul of the Singaporean Consulate General in Ho Chi Minh City, said that Singaporean investors are interested in infrastructure development in Vietnam and that they are experienced in everything from plan making to project management. Singaporean investors have vast experience in building infrastructure and they want to use this experience in Vietnam.

Healthcare in Singapore is excellent and competitively priced and Singaporean investors are considering bringing Singaporean- quality healthcare to Vietnam. Among the Singaporean investors interested is the Parkway Hospitals (Singapore) Group. The group's regional manager, Richard Tan, said that Parkway Hospitals now has three representative offices in Vietnam and he feels that it is time for the group to funnel capital into Vietnam. Parkway Hospitals is at this time looking for a partner, he said.

To attract more investment from ASEAN countries and particularly Singapore, beginning August 8, 2007, Prime Minister Nguyen Tan Dung went abroad to visit ASEAN nations, including Singapore. Encouraged by the Prime Minister, Vietnamese authorities are reviewing and classifying ASEAN projects in Vietnam to help investors with their administrative procedural problems, site clearance and other matters.

Licenses have been issued for a number of Singaporean projects that have not yet started operation and the Vietnam Government would like to see these projects get off the drawing table as soon as possible. About US$5 billion of licensed Singaporean projects in Vietnam have not been invested yet. Vietnamese and Singaporean authorities both want to improve the regulations regarding the granting of investment certificates by both the Vietnamese Ministry of Planning and Investment and the Singapore Economic Development Board (EDB) to speed up the process.

Source: Vneconomy