Inflection point clear in investor sentiment

Vietnam’s foreign investment landscape has revealed a striking shift, with capital flows reversing course sharply after a subdued start to the year.

- By Minh Vu

According to the Foreign Investment Agency (FIA) under the Ministry of Finance, newly released data show that total registered foreign direct investment reached $15.2 billion in the first quarter of 2026, marking a strong on-year increase of 42.9 per cent. The surge was largely driven by a breakout performance in March, which lifted overall quarterly figures after weaker inflows in the earlier months.

The most notable development lies in the composition of capital flows. Newly registered investment rose sharply to $10.23 billion, up 140 per cent on-year. Even more striking was the turnaround in capital contributions and share purchases by foreign investors, which rebounded strongly after declining in the first two months. For the quarter, this segment reached $2.66 billion, 2.3 times higher on-year.

In contrast, adjusted capital, additional investment into existing projects, fell to $2.3 billion, down 55.1 per cent. This divergence suggests that while investors remain willing to commit to new opportunities, they are more cautious when expanding existing operations amid ongoing global uncertainties.

The quarterly recovery masks a highly uneven trajectory across individual months. In January, total registered FDI stood at just $2.57 billion, down more than 40 per cent on-year, largely due to declines in adjusted capital and merger and acquisition activity.

Van Duc Phu from the FIA’s Northern Investment Promotion, Information and Support Centre said, “What we are seeing in the first quarter is not just a rebound, but a clear inflection point in investor sentiment. The sharp recovery in March suggests that capital has not left Vietnam, it has simply been waiting for the right timing and signals to reenter.”