Vietnam forecasts record US$15b foreign investment in 2016

[HANOI] Vietnam forecasts disbursed foreign direct investment to rise to a record this year with companies such as South Korea's Samsung Electronics Co and LG Electronics Inc shifting factories to the South-east Asian nation.

Disbursed foreign investment may reach US$15 billion in 2016, Prime Minister Nguyen Xuan Phuc told donors, including the World Bank and the International Monetary Fund, at a Hanoi conference Friday.

The country may have a trade surplus of US$2 billion to US$3 billion, with exports likely rising 8 per cent this year, Mr Phuc said. Disbursed FDI rose 17.4 per cent to US$14.5 billion last year, according to government data.

Vietnam "will redouble efforts to improve its investment environment" while also speeding up overhaul of regulations to make it easier for investors as the government boosts businesses for a faster and sustainable growth, Mr Phuc told donors.

Rising foreign direct investment and thriving exports are helping to shield the economy from global risks. The World Bank forecasts Vietnam's economy will expand at least 6 per cent this year through 2018, among the fastest in the world. The prime minister on Thursday estimated economic growth may reach 6.3 per cent in 2016.

The government, which plans to form an agency to fast-track stake sales in state companies, is in talks with the Asian Development Bank for the acquisition of a "weak Vietnamese bank", said the prime minister, who did not provide details.

The government is also working with the International Finance Corp, an investment arm of the IMF, to speed up the resolution of bad-debt in Vietnamese banks, according to Mr Phuc.

BLOOMBERG