A rise in both actual and registered foreign direct investment (FDI) inflows last year will further boost the country’s domestic activities in the next few quarters, researchers at the bank said.
Disbursed FDI inflows into the country saw a record high of $23.2 billion last year, while registered FDI rose by 32 per cent to $36.6 billion, almost matching the record high of $38 billion in 2019.
Foreign investors continue to perceive Vietnam as a key destination in the mid to long term and are confident about the country’s prospects, amid the ongoing shifts in global supply chains, they were cited as saying by a domestic media outlet.
The country’s gross domestic product (GDP) growth was 5.05 per cent last year. External demand showed signs of recovery in the latter part of the year, helping manufacturing output return to positive territory towards the end of the year.
The road remains bumpy for the year ahead, with downside risks due to the uncertainties and risks arising from the ongoing military conflicts elsewhere in the world, geopolitical tussle among the major powers and high interest rates, they said.
The implementation of global minimum tax (GMT) in Vietnam on multinational corporations from January 1 this year will force such companies to take into account higher tax costs in their future planning, they added.
The bank, therefore, suggested the Vietnamese government to initiate measures to offset the GMT in order to preserve the export competitiveness of the country.
ALCHEMPro News Desk (DS)
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