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Foreign direct investment into real estate and macroeconomic instability in Vietnam

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  • Quoc Hoi Le

Abstract

In recent years, foreign direct investment (FDI) into real estate in Vietnam has been constantly increasing and is becoming the most attractive business area for foreign investors. Beside positive impacts such as augmenting capital resources and improving socio-economic infrastructure, this paper shows that FDI into real estate in Vietnam contributes to the derivation of macroeconomic instabilities such as raising inflation, causing instability in the exchange rate, payment balance, and the banking system. That reality requires the government to implement solutions relating to strengthening the control of FDI inflows into real estate, monitoring real estate credit risks as well as directing FDI inflow into relevant business areas, both to use the capital effectively and to avoid causing macroeconomic instability.

Suggested Citation

  • Quoc Hoi Le, 2016. "Foreign direct investment into real estate and macroeconomic instability in Vietnam," Afro-Asian Journal of Finance and Accounting, Inderscience Enterprises Ltd, vol. 6(3), pages 258-268.
  • Handle: RePEc:ids:afasfa:v:6:y:2016:i:3:p:258-268
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    Cited by:

    1. Phan Tran Minh Hung & Tran Thi Trang Dai & Phan Nguyen Bao Quynh & Le Duc Toan & Vo Hoang Diem Trinh, 2019. "The Relationship between Risk and Return - An Empirical Evidence from Real Estate Stocks Listed in Vietnam," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(11), pages 1211-1226, November.
    2. Manh-Tung Ho & Ngoc-Thang B. Le & Hung-Long D. Tran & Quoc-Hung Nguyen & Manh-Ha Pham & Minh-Hoang Ly & Manh-Toan Ho & Minh-Hoang Nguyen & Quan-Hoang Vuong, 2021. "A Systematic and Critical Review on the Research Landscape of Finance in Vietnam from 2008 to 2020," JRFM, MDPI, vol. 14(5), pages 1-24, May.

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