Of this, USD7.67 billion will flow into 583 new projects and the remaining into 168 existing projects, according to the Foreign Investment Agency.

The investment in new projects is just 14.3 per cent of the amount during the same period last year, while there has been an increase of 7 per cent in funds flowing into existing projects.

Phan Huu Thang, head of the department, said despite the steep fall from last year it is a positive figure given the global economic recession.

The hotel and restaurant businesses attracted the largest investments, at nearly USD4.57 billion in both new and existing projects, followed by the property sector with USD3.65 billion.

Ba Ria-Vung Tau Province topped the country in attracting investment with USD 6.6 billion, followed by Binh Duong with USD2.45 billion, HCM City with USD1.14 billion, Ha Noi with USD 383 million, and Dong Nai Province with USD281 million.

Actual disbursement of FDI has, however, fared much better this year in terms of proportion compared to last — USD 7.2 billion against USD 8 billion. Total disbursement this year is likely to meet the target of USD 10 billion, the department has said.

Hirota Nakanishi, senior investment adviser to the Japan External Trade Organisation in Viet Nam, said Japanese investors rated Viet Nam’s economic potential highly and were set to make large investments in the country. They would focus on industries like food and beverage, civil construction, transportation, logistics, health care, and software, he told a newspaper.

Viet Nam’s great attractions was its young population and low average monthly salary of USD 95.8, he said. Japan is the third largest investor in Viet Nam, with 1,110 projects with an investment of USD 17 billion, according to the agency. Meanwhile, foreign direct investment in Ha Noi fell in the first nine months of this year compared with last year due to impacts of the global economic downturn, the Ha Noi Statistics Office said.

So far this year, the city attracted 225 foreign invested projects with a total foreign investment of USD383 million, the office said, which was 90 per cent of the total foreign investment projects over the same period last year and just 9 per cent of total foreign investment capital.

Of the USD 383 million, there were 189 new foreign investment projects with a total capital of USD 152 million and 36 existing projects which increased their capital by a total of USD 248 million.

The project to register the largest amount of capital, at USD 54 million, was the Viet Nam Satellite Digital Television Ltd Company, a joint venture between Viet Nam Cable Television’s Technical Centre and a French partner.

The statistics office expected foreign investment in Ha Noi to increase this year based on signs of a global recovery.

The city is targeting USD 2-3 billion in foreign direct investment this year, which would place it in the country’s top five locations for foreign investment, the city’s department of planning and investment said. In order to reach the goal, the city needed to perfect its "one-stop shop" policy in business registration and capital construction as well as boost transparency in trade and investment, the department said.

The city authorities would consider the same policy in other areas like land leasing and transfer to foreign investors, and it would also upgrade it’s administration IT infrastructure to speed up on-line registration procedures.

In 2008, the city licensed 270 new foreign investment projects with a total registered capital of USD 4.4 billion. It also permitted 30 existing projects to increase their capital by USD 6 million. Information and communication technology and real estate remained the most attractive sectors for foreign investors.