VietNamNet Bridge – The Foreign Investment Agency (FIA) has estimated the number of offshore projects to be licensed for local enterprises this year at around 150, and registered capital for fresh and operational projects at US$1.5-2 billion.

An employee of Viettel shows a customer how to use the military-run telecom group’s services on a mobile phone. Viettel is one of the domestic enterprises to have made big offshore investments

The capital disbursed by Vietnamese enterprises for their projects overseas could reach US$1-1.2 billion in 2015, according to the latest report of FIA under the Ministry of Planning and Investment.

In 2014, fresh and additional offshore investments pledged by Vietnamese enterprises amounted to nearly US$1.79 billion, according to FIA.

The ministry licensed 109 out of 153 projects in 28 countries and territories last year with total capital of around US$1.05 billion registered by Vietnamese enterprises. Besides, local companies committed US$739 million to 22 offshore operational projects.

The overseas investment projects in 2014 edged up 10% in number compared to 2013 but dropped some 10% in registered capital as most of the licensed projects were small. The majority of these projects were located in Cambodia and Myanmar and in telecom and farming sectors.

Other licensed projects involve trading, services, construction, transport, property and manufacturing in ASEAN, Russia, Japan, South Korea, Europe, the United States, Australia and Africa. This indicates Vietnamese investors are expanding their operations overseas to generate new revenues from the fields requiring small investments but guaranteeing quick return on investment.

In addition to State-owned enterprises, investments of the private sector, especially individuals and small- and medium-sized enterprises, are rising. Of the projects licensed last year, 12.5% belonged to individual investors and 76% projects were registered by private enterprises.

As of last year, Vietnamese firms had invested in 930 offshore projects with total capital pledges of US$14.85 billion and registered an additional US$4.93 billion for 92 projects.

Disbursements as of last year had amounted to around US$6 billion, accounting for 30.6% of the total registered capital. The oil and gas sector made up the highest proportion of disbursement with some US$2.9 billion, followed by agriculture and forestry over US$660 million, hydropower over US$500 million, telecom over US$450.6 million, and finance-banking-insurance over US$230 million.

FIA pointed out problems with offshore investments by Vietnamese enterprises such as slow implementation and disbursement, premature termination of projects, and difficult fund raising.

SGT