Chinese investment into Vietnam has been on a sharp rise,
putting the country among the top ten foreign investors in Vietnam.
According to the Vietnamese Ministry of Planning and Investment, Chinese
companies invested USD340 million into Vietnam in January, accounting for 22%
out of the country’s total foreign direct investment (FDI) in month. This
positioned China in third position among foreign investors in Vietnam in
January, just behind Singapore and South Korea.
Cat Linh-Ha Dong urban railway project using
Over the past five
years, Vietnam has seen a considerable increase in Chinese FDI. By the end of
2016, China’s total FDI in Vietnam reached USD10.5 billion, securing the 8th
spot among foreign investors in Vietnam, compared to just around USD2 billion
at the 13th in 2012.
The Ministry of Planning and Investment showed that more than half of Chinese
FDI is poured into Vietnam’s processing and manufacturing industries.
Experts said that most of Chinese-invested projects in Vietnam are
concentrated in areas which have cheap labour but face high risk of pollution
such as garment and textiles, hydropower, steel production, chemicals and
However, Hanoi National University Director of the Institute of Economic and
Policy Research Dr. Nguyen Duc Thanh said welcoming Chinese FDI, which is
often characterised by out-dated technology and exploitation of natural
resources, Vietnam would lose natural resources while the country’s
environment would be harmed.
Dr. Luu Bich Ho, Former Head of the Institute of Policy and Strategy, said
Vietnam welcomed FDI projects, but this did not mean that the country wanted
to attract projects by any means. Vietnam needs to choose
environmentally-friendly projects. Limits should be placed on Chinese
investment, particularly with respect to natural resources.