Vietnam's FDI Landscape Shifts Towards Quality Investments

In the first seven months of 2026, Vietnam attracted over $38.06 billion in foreign direct investment (FDI), marking a remarkable increase of nearly 58% compared to the same period last year. This surge is not only attributed to a higher number of projects but also to a significant shift in the quality of investments, with larger and more technologically advanced projects taking precedence.

According to the Ministry of Finance, while the number of newly registered FDI projects rose by only 7.8%, the total registered capital exceeded $21 billion, a staggering increase of 109.7%. This indicates a trend where multinational corporations are prioritizing strategic investments over smaller-scale projects. Notably, the average capital per project has more than doubled, reflecting this shift.

Vietnam's FDI is increasingly directed towards high-value sectors such as semiconductors, electronics, information technology, and energy infrastructure. A prime example is LG Innotek's $1 billion semiconductor factory in Hai Phong, marking the company's first manufacturing facility outside South Korea. This project signals Vietnam's growing role as a hub for high-tech investments in the global supply chain restructuring.

“Vietnam has become one of the world's most attractive destinations for FDI due to competitive labor costs, political stability, and an expanding network of free trade agreements.”Richard Barnsley, Global Banking Director at HSBC Vietnam

The quality of FDI is further evidenced by the actual disbursement of funds, which reached over $15.2 billion in the same period, an increase of 11.76% and the highest level recorded for the first seven months in five years. Economic experts assert that this continuous rise in disbursement reflects investor confidence in Vietnam's business environment and long-term prospects.

Richard Barnsley, Global Banking Director at HSBC Vietnam, emphasized that Vietnam has become one of the world's most attractive destinations for FDI due to competitive labor costs, political stability, and an expanding network of free trade agreements (FTAs). However, he noted that the current FDI model focused on boosting exports has its limitations. The next phase of development will require not just attracting more capital but also creating and retaining greater value from these investments.

As companies restructure their global supply chains, they are seeking investment destinations that offer resilience, predictability, and innovation-driven environments. Barnsley highlighted that strong institutions have become one of the most valuable competitive advantages a nation can offer. Consequently, Vietnam's new goal is not merely to attract capital but to draw in capabilities such as technology, human resources, and research and development, allowing local firms to engage more deeply in global value chains.

“The resolution signifies a paradigm shift in how Vietnam approaches FDI, moving from a focus on quantity to evaluating the impact of investments on the economy.”Trần Anh Tùng, Head of Business Administration at the University of Economics and Finance in Ho Chi Minh City

The insights from HSBC align with the new direction outlined in Resolution 10 of the Politburo, which aims to attract $200 to $300 billion in new registered FDI and disburse $150 to $200 billion from 2025 to 2030. This resolution particularly targets attracting around three-quarters of this capital from developed economies and aims to integrate 10,000 domestic enterprises into the supply chains of foreign-invested firms.

Trần Anh Tùng, Head of Business Administration at the University of Economics and Finance in Ho Chi Minh City, remarked that the recent achievements in the FDI sector stem from three key factors: macroeconomic stability, a conducive political environment, and the ability to maintain production chains amid global fragmentation. Investors are no longer just looking for the cheapest options but are searching for safe locations that can connect with China, ASEAN, the U.S., and Europe simultaneously.

The resolution also signifies a paradigm shift in how Vietnam approaches FDI, moving from a focus on quantity to evaluating the impact of investments on the economy. This includes prioritizing new-generation FDI in sectors like semiconductors, AI, data centers, biotechnology, and green energy, rather than labor-intensive industries.

“Increasing the quality of FDI will certainly support the economy's development at a higher level.”TS Nguyễn Quốc Việt, Head of Macroeconomic Research Group, National Economics University

Experts agree that the quality of FDI is improving, indicating that Vietnam is integrating more deeply into global supply chains. This not only enhances export value but also serves as a long-term growth driver for the economy. The Ministry of Finance's data shows that the registered FDI in the processing and manufacturing sector reached $18.68 billion, accounting for nearly half of total FDI and 82.6% of actual disbursements in the first seven months.

Moreover, new FDI projects are increasingly demanding higher standards in technology, environmental responsibility, and social accountability. This trend is crucial for elevating growth quality rather than merely increasing capital influx.

As Vietnam stands on the cusp of a pivotal moment in its FDI journey, the competition for high-quality investments is intensifying. Countries are no longer competing solely on tax incentives or low labor costs; instead, international corporations are placing greater emphasis on institutional quality, stability, and innovation-driven policies. The ability to innovate, automate, and maintain high productivity will become more critical than ever as Vietnam seeks to transition from being merely a manufacturing hub to a center of technological creation.