The era of huge projects returns

After three projects with registered capital of over $1 billion each were licenced, total foreign direct investment (FDI) in Vietnam in the past 10 months rose to more than $19 billion.

The first huge project with registered capital of up to $2.4 billion was licenced in October. It is a thermal power project in the southern province of Tra Vinh, invested by Janakuasa from Malaysia. The two others include Samsung Display’s $3 billion project and the Imperial City estate project worth $1.2 billion.

These projects contributed up to $6.6 billion out of the total capital of $19.29 billion of the new projects in Vietnam this year, accounting for over 34%.

Samsung is the only example in the very rapid implementation of the commitment to invest billions of dollars in projects in Vietnam.

As anticipated by the Ministry of Planning and Investment, shortly after the billion USD projects were licenced, the FDI flow into Vietnam increased sharply over the same period of the previous year, by 40.8%.

The appearance of huge projects, as usual, was praised by the public. People living in these locations expect a positive impact of these projects on the local economies.

However, it is a sad fact that not many huge projects in Vietnam have been put into operation.

Samsung is the only example in the very rapid implementation of the commitment to invest billions of dollars in projects in Vietnam, such as Samsung Electronics Vietnam in Bac Ninh Province and Samsung Electronics Vietnam Thai Nguyen in Thai Nguyen Province.

These projects have contributed very positively to economic development in Vietnam. These two plants alone last year contributed $26.3 billion to the total export revenue of the country. The figure for this year is estimated at about $30 billion.

The latest project of Samsung Play has been carried out.

In addition to Samsung projects, the number of huge projects that are about to start operation is small - the $1.5 billion project of LG, Formosa Steel Complex of $10.5 billion, or China Steel Sumikin project with investment of over $1.1 billion.

Meanwhile, the list of huge projects that are idle is quite long, consisting of the $3 billion Guang Lian Steel of Tycoons and E-United in Dung Quat Economic Zone in Quang Ngai province, which has been abandoned for nine years; the $1 billion Bus Center project of Russian investors in Binh Dinh; the $1 billion Kobelco steel project in Nghe An; and billion-dollar projects of Berjaya (Malaysia) in HCM City and Dong Nai.

Because of these idle projects, hundreds of hectares of land have been left fallow, causing huge waste.

Unlike the previous years, many billion USD projects licenced recently are the “real” ones.

Of the three newly-licenced projects, Samsung Display has been implementing its project. The two others should kick off early.

"If large-scale projects are delayed, it is necessary to review and revoke them to give opportunities for other investors and to avoid waste," said Dr. Nguyen Mai, chairman of the FDI Business Association.

Vietnamnet/Dau Tu