Many foreign investors have committed to continue their registered projects, but they will not be able to do so without being granted land, Thang told Thanh Nien.

The priority of 2009 is disbursement as there is a large gap between FDI pledges and the amount of money that’s actually spent each year, he said.

Thang said localities needed to overhaul site clearance and land compensation processes to pick up the pace of FDI disbursement.

“The largest obstacle now is that local governments do not transfer land to investors [on time] as they have promised,” he said.

Vietnam this year attracted a record amount of FDI, both pledges and disbursements, for the 20 years the country has been receiving foreign investment, Thang said.

Investors promised more than US$64 billion to Vietnam this year, Foreign Investment Department figures show. Of the total registered FDI, $11.5 billion has been disbursed, an increase of 43.2 percent from last year.

Foreign investment inflows and about $8 billion in remittances from overseas are key sources of funds that can help Vietnam narrow its trade deficit, which is estimated to have risen nearly 21 percent this year to $17 billion, Reuters reported.

The most important thing is that Vietnam has used FDI to boost production and development in a period of economic slowdown, Thang said, adding that investment into the country may have been much greater without the global downturn.

Although a large amount of FDI was committed to real estate, capital in the production sector also remained high, he said.

Vietnam will not restrict any large property projects because the country still needs more resorts and international standard hotels for foreign tourists, Thang said.

Reported by Xuan Danh