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Vietnam’s FDI inflow falls 29% in Jan-May 2009
Actual foreign direct investment (FDI) inflow into Vietnam dropped at an estimated annual rate of 29 percent to $2.8 billion in the first five months of this year, while new pledges plunged nearly 90 percent, Reuters quoted the government as saying Monday.
New FDI pledges reached an estimated $2.7 billion between January and May, while the increases in funding for projects already under way rose 27.8 percent from the same period last year to $3.96 billion, a government statement said.
FDI inflows, along with remittances from abroad, have been a major source of foreign exchange for Vietnam and pillars of the Southeast Asian country's strong economic growth in recent years, but economists expect them to slump this year.
Last year Vietnam attracted $11.5 billion in FDI, and Prime Minister Nguyen Tan Dung had hoped to reach the same level this year.
Vietnam's central bank said earlier this month it had sufficient foreign exchange reserves of about $20 billion to meet domestic demand for dollars.
The government statement said 91 percent of the FDI value so far this year has been pledged for investing in real estate, food and accommodation services.
The United States now tops the list of foreign investors in Vietnam in term of funds for existing projects, with $3.8 billion in the five-month period, while South Korea made the biggest pledges among the new projects, totalling $1 billion, the government said.
It said exports by foreign-invested companies, including crude oil, totalled $10.85 billion in the first five months of this year, down 21.4 percent from a year earlier.
Earlier on Monday the government estimated that the country's trade deficit in May widened to $1.5 billion from $1.18 billion in April, while the January-May shortfall fell sharply from a year earlier.
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