UOB, Vietnam's Foreign Investment Agency secure over S$3b of direct investments into country

Singapore

UOB has secured more than S$3 billion of foreign direct investment (FDI) into Vietnam in alliance with Vietnam's Foreign Investment Agency (FIA) and is facilitating an additional pipeline of more than S$1.5 billion under an expanded Memorandum of Understanding (MOU) with FIA, said the bank on Friday.

The lender has helped more than 150 companies seize opportunities in Vietnam, and aims to double the number as part of the latest MOU. More than 2,000 jobs are forecasted to be created in Vietnam from the next wave of investments, on top of the more than 17,000 jobs already created under the first MOU.

UOB and FIA signed their first MOU in 2015 with the intention of increasing FDI and trade between Vietnam and South-east Asia. The MOU was Vietnam FIA's first such collaboration with a bank; the FIA is the designated agency under Vietnam's Ministry of Planning and Investment and supports FDI into Vietnam and Vietnamese companies venturing overseas.

Under the terms of the expanded MOU, the bank will be focusing on sectors that the Vietnamese government is seeking to develop - sustainable energy, manufacturing, infrastructure, healthcare and technology.

It will also see FIA broaden access to investment opportunities beyond Ho Chi Minh City and Hanoi, and into fast-developing cities such as Bach Ninh, Hai Duong, Binh Duong and Dong Nai.

Under the MOU, FIA will provide companies referred by UOB with advisory on investment policies and dedicated support in investment procedures and applications.

UOB's deputy chairman and CEO Wee Ee Cheong said: "The expanded MOU with FIA reaffirms our close and collaborative relationship in helping regional companies tap Vietnam's vibrant economy, driving their sustainable advancement and boosting trade flows and job creation across Asean. With the seamless connectivity and sectoral expertise we offer throughout our regional network, UOB is well placed to support companies looking to diversify their supply chains amid disruptions caused by the global pandemic."

UOB remains the first and only Singapore bank to establish a foreign-owned subsidiary in the country.

UOB Vietnam has two offices in Ho Chi Minh City and one in Hanoi.

In 2013, UOB set up a dedicated FDI Advisory team in Vietnam as part of broadening its support for regional clients investing in the country. The advisory team team provides companies from across the bank's network with local insight, market entry support and customised financial solutions, and connects them to regional business opportunities.

While global FDI has been on a downward trend over the last few years, inflow into Asean has continued to increase noted head of Group Foreign Direct Investment Advisory and Network Partnerships, Sam Cheong, at Friday's briefing.

He also noted that Asean FDI is showing more resilience with a 20 per cent drop in the first half of the year, compared with global FDI inflows which have dropped 49 per cent in the same period.

"Next year, we expect global FDI to dip a bit, about 5-10 per cent, based on our understanding from the market. But in the case of Asean - in fact, this Q4, we're already seeing our businesses pick up very strongly - we expect Asean to bounce back in the range of 10-15 per cent. So it's a pretty positive outlook for Asean next year, and we are expecting recovery in terms of FDI inflows."

The MOU signing ceremony was conducted virtually on Friday and attended by senior Vietnamese government officials and senior leaders from UOB.