China accounted for nearly 50% of new FDI projects in wood industry
A report of activities of foreign-invested enterprises in wood industry in 2023 jointly conducting by research team of Forest Trends Organization and Wood Associations shows that, in 2023, FDI investment projects in wood industry increased in both quantity and investment capital in all three forms of investment including new investment, capital adjustment and capital contribution and share purchase.
Accordingly, with new investment, number of projects and new capital increased by over 2 times and 3.3 times respectively compared to 2022. In 2020, wood industry received 63 new projects with 372.68 million USD, a decrease 36.4% in number of projects and 48.7% in investment capital compared to 2019. In 2021, number of new investment projects in the industry continues to decrease, only receiving 35 projects with a capital of 332.84 million USD, decreased by 44.4% in number of projects and 10.7% in investment capital. In 2022, number of new investment projects only received 28 projects with a capital of 90.25 million USD, a decrease of 20% in the number of projects and 72.9% in capital. In 2023, wood industry received 57 new investment projects with a capital of 300.06 million USD.
In 2023, there will be 12 countries and territories investing in new projects in wood industry. However, investment capital was mainly concentrated in countries/territories such as China, Singapore, Japan, Hong Kong (China) and Seychelles. In particular, in 2023 the Netherlands was a new country joining list of countries/territories with large investment capital.
Specifically, with 28 investment projects and an investment capital of 106.63 million USD, China accounted for 49.1% of number of projects and 35.5% of total foreign investment capital in wood industry in 2023. Singapore with 7 new projects with a capital of 35.28 million USD, accounted for nearly 12.3% of number of projects and 11.8% of investment capital. Hong Kong (China) with 5 new projects, investment capital of 23.21 million USD, accounted for 8.8% of number of projects and 7.7% of total investment capital.
Seychelles with 4 new projects; Japan with 4 new projects; United States with 3 projects; Netherlands 1 project. In addition, in 2023, Vietnam also received new investment capital from countries/territories such as: Taiwan (China); Marshall Islands.
Average investment capital scale of each new FDI project in 2023 will reached about 5.26 million USD/project, an increase of 1.6 times compared to the previous one.
Among them, Japan has largest average investment capital of each project, reaching over 11.2 million USD/project. Taiwan (China) ranked second with an average capital size of 8.25 million USD/project. Seychelles ranked third with an average capital of 5.5 million USD/project. Singapore ranked fourth in terms of investment capital scale of each project, reaching 5.04 million USD/project. Hong Kong (China)’s average investment capital reached over 4.64 million USD/project. Netherlands has 1 project with investment capital of nearly 31.99 million USD. Although China is the leading country in number of investment projects, average capital/project is only 3.81 million USD/project.
FDI enterprises still account for nearly half of total export turnover
In 2023, Vietnam had 4,508 enterprises participating in direct export with a turnover of over 13.18 billion USD. Number of FDI enterprises participating in export is 706, accounting for 17.4% of total number of export enterprises, down by 0.8% compared to number of FDI enterprises participating in export in 2022. Export value of FDI enterprises reached nearly 6.25 billion USD, down by 18.3% compared to the previous year, accounting for 47.4% of total export value of wood and wood products of the country.
In 2023, FDI enterprises with investment capital from China, Taiwan (China), British Virgin Islands, Singapore and Japan lead in export value. Total export turnover of FDI enterprises in the above-mentioned 5 countries/territories reached 4.75 million USD, accounting for 76% of total export turnover of FDI sector.
FDI enterprises sector is one of important development drivers of the economy with important input factors for development such as capital strength, management level, technology and market access. The Government also expects that over time, these input factors will be spread to Vietnamese enterprise sector.
Foreign direct investment (FDI) has become an important component of wood industry. Number of FDI enterprises participating in industry and export turnover of this sector have always grown steadily in recent years.
However, current performance of FDI enterprises in wood industry shows something worth pondering for Vietnamese wood industry. Accordingly, number of FDI enterprises participating in direct export is small but their wood export turnover is very large. This shows superiority of this sector in wood export compared to domestic enterprises. This advantage can come from many factors such as production/investment scale, management level, technology, market access, etc.
Mr. Tran Le Huy - Vice Chairman of Binh Dinh Timber and Forest Products Association (FPA Binh Dinh) - commented that up to now, connection between FDI enterprises and Vietnamese enterprises is still limited. The government and wood associations need to promote formation of a suitable institutional and policy environment to encourage formation of connections between FDI enterprises and Vietnamese enterprises. This connection should also include stronger and more practical participation of FDI enterprise sector in policy discussions related to development of industry. Implementing these things will contribute to promoting Vietnam's wood industry to develop sustainably in future.

Source: Vitic/ congthuong.vn