Pledged foreign direct investment in Vietnam jumps nearly fourfold so far this year

Pledged foreign direct investment into Vietnam has soared nearly fourfold so far this year, a government official said Monday, indicating investors are optimistic despite surging inflation in the country.

As of June 22, overseas companies have agreed to invest $31.6 billion in 478 projects compared to $8.5 billion during the same period last year, said Nguyen Thuy Huong, an official with Vietnam's ministry of planning and investment.

"It shows that foreign investors' confidence in Vietnam remains very strong," Huong said. "Our economic difficulties are just short-term."

Also, investment in 158 existing projects has been increased by $661 million.

The report came as Vietnam's prime minister began a visit to the United States on Monday. Prime Minister Nguyen Tan Dung is the communist country's third high-ranking leader to visit Washington since the former foes normalized relations in 1995, two decades after the Vietnam War ended.

Taiwan led the list of investment in Vietnam as ranked by country of origin as a result of its $7.9 billion steel project in central Vietnam approved this month.

Japan came second with $7.1 billion in pledged investment, followed by Canada, which had a $4.2 billion beach resort complex in southern Vietnam approved in May.

Vietnam's economy has grown rapidly since the communist government decided to open up to the outside world about a decade ago. The country's admission to the World Trade Organization last year has helped to lure more foreign investment.

But this year, Vietnam has been hit by accelerating inflation -- reaching 25 percent -- and the government has lowered its economic growth forecast to 7 percent from 8.5 percent. The stock market has also plunged over the last year.

Last year, Vietnam attracted $20.25 billion of foreign direct investment, a record since the country began accepting foreign investment in 1998.

Source: AP