NATIONAL
UNIVERSITY-
HCMC
COLLEGE
OF
ECONOMICS
VIETNAM
INSTITUTE OF
SOCIAL
STUDIES
THE
HAGUE
THE
NETHERLANDS
VIETNAM-
THE
NETHERLANDS PROJECT
ON
DEVELOPMENT
ECONOMICS
IMPACT
OF
FOREIGN
DIR.EC'f
INVESTMENT
ON
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CASE
FOR
VIETNAM
(1988-1995)
by
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HO
CHI
MINH
CITY,
December
19~-----
-------------
·-
CERTIFICATION
"I certify that the substance
of
this dissertation has
not
already
been
submitted for
any
degree
and
is
not
being currently submitted for any
other
degrees.
I certify that to the
best
of
my knowledge any
help
received
in
preparing
this
dissertation, and all sources used,
have
been
acknowledged in this dissertation".
Signature
Nguyen
To
Kieu Trinh
Date :
December,
20th, 1996
I wish to express
my
thanks to authors whose thoughts are foundation for my
thinking
in
this research paper.
ABSTRACT
In
the context
of
"'Open door" and "Doi moi" policies, Foreign Direct Investment
inflows in Vietnam have been considered, among other things, as having a significant
impact (either direct
or
indirect) on the development process, especially on
the
export
performance
of
Vietnam.
The
export increases steadily every year from 1988
at
annual
average growth rate
of
32.02%, especially since 1991. Average annual growth rate in
period 1988-90 was 44.0% and 44.4% in 1995.
The inflows
of
Foreign Direct Investment firstly concentrated in mineral and services
(mainly hotels and tourism) sector, but recently it has been shifted to industrial sector.
This trend is appropriate for the process
of
industrialisation and modernisation
of
Vietnam. It increases every year, from only 366 million USD
of
investment capital
(implemented capital
of
60 million USD) in 1986 up to 6,400 million USD
(implemented capital
of
2,000 billion USD) in 1995. Total investment capital
approached 18,228 million USD and implemented capital approached 5,878 million
USD from 1988-95. Increase in exports in the context
of
'Open-door' policy, among
other things, in period 1988-1995, reflected the response
of
nice achievement, not only
in short but also in long run, from the positive influence
of
Foreign Direct Investment
although that this influence was still modest.
Identifying the impact
of
Foreign Direct Investment
on
export performance
of
Vietnam
from 1988 till 1995 is the subject
of
this paper.
111
Thanks are
due
to
my
classmates
Hoang
Due Phu,
Pham
Kien
Phuong
and
Nguyen
Anh T
uan
for
their
helps
and
interests, especially,
Nguyen
The
Minh
for his
tireless assistance
in
providing
useful data.
Words
of thanks are also
due
to
my
close
friend
Do
Dinh
Nam
for
his
tireless
help
in
providing
useful documents.
I acknowledge
with
thanks
Ms.
Dang
thi
Kim
Chi,
librarian;
Ms.
Dinh
Thi
Anh
Nguyet,
Secretary
of
Project for
their
interests
and
material provisions;
and
my
classmates
and
all friends for
their
support
throughout.
WorO.S
of thanks
are
due
to
my
family.
Many
are worthy of mention.
To
them, I
am
eternally grateful. Finally, this
work
is
devoted
to
my
parents,
Nguyen
Huu
Duy
and
Cong
Tang
Ton
Nu
Thi Le Hong,
who
gently bestowed
me
with
curiosity
and
concern
about
the
world.
Needless to say,
any
remaining mistakes
or
omissions are entirely mine.
TABlE
OF
CONTENTS
ABSTRACT
ACKNOWLEDGEMENTS
TABLE
OF
COTENTS
LIST
OF
TABLES
LIST
OF
CHARTS
Chapter
1 INTRODUCTION
1.1
General Information
1.2 Statement
of
the Problem
1.3
Objectives
of
the Study
1.4
Organisation
of
the Study
Chapter
2
THEORETICAL
FOUNDATION AND EVIDENCES
OF
FOREIGN
DIRECT INVESTMENT AND ITS
IMPACTS
ON
EXPORTS
2.1 Definition
of
FDI
2.2 Theoretical Foundation
of
FDI and evidences
of
its
Impacts on Exports
2.2.1 Theoretical Foundation
ofFDI
2.2.1.1 Models and Forms
ofFDI
a) Models
ofFDI
a.l
Export-Oriented FDI (EO FDI)
a.2 Import-Substituting FDI (IS FDI)
a.3 Market- and Technology- Accessing FDI
IV
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