Vietnam's FDI Journey: From $2 Million to $524 Billion Over 35 Years Marked by Waves of Growth, Crisis and Recovery
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Over 35 years, Vietnam’s FDI has grown from $2 million to $524 billion with over 36,000 active projects.
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FDI started slowly in the 1980s but grew rapidly from 1991, marking the first wave with companies like PouChen, Feng Tay, and Honda entering Vietnam.
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After a dip due to the 1998 Asian financial crisis, FDI recovered in 2002 and surged to new heights in 2006-2008 with billion dollar projects, marking the second wave.
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The 2008 global financial crisis caused FDI to drop significantly compared to commitments. It recovered slowly between 2015-2019, marking the third wave.
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South Korea, Singapore and Japan are the top 3 FDI contributors. The US is not in the top 10 but expected to drive the fourth wave after upgraded relations.
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FDI contributes 19% of GDP and 35% of jobs despite being only 3% of businesses. It accounts for over 50% of exports in key sectors.
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FDI businesses are more efficient and profitable than domestic ones. Over half of big companies are FDI.
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FDI brings technology and management experience but technology transfer and local collaboration remain limited.