Inward FDI is said to bring about externalities to the host economies.There aremany empirical studies about such impacts but we hardly find any studies concerningthe case of Vietnam. This empirical study attempts to examine these impacts onVietnam’s economy during 1989-1996. The cross-sectional data from the nationalcensus of about 1.9 million businesses and enterprises operating in Vietnam in 1994-1995, and Vietnam’s 1989 and 1996 Input-Output tables are employed on intra-andinter-industry and intra-region approaches.The study provides the following results:Firstly,it is not easy to identify the intra-industry spillover created by FDI on entireindustry in general.However,in particular,the negative intra-industry impacts occurin sub-sectors of provincial State enterprises,private enterprises and ltd.Companies.Secondly, on the provincial base, negative intra-provincial impacts are observed inthe entire domestic sector, especially in the South. The negative impacts may be interms of crowding-out effect or causing demonstration effect. Thirdly, FDI maycontribute to generate positive inter-industry spillover in the form of backward and/or forward linkage effects in some industries,yet it may cause negative impact on acertain primary industry in terms of shrinking employment and Gross NationalProduct (GNP), adversely impacting the balance of payment in the long-run.Finally,regarding policy-relevant implication,this paper also points out that the limitation ofthe spillover effects may be caused by the redundant incentives favoring FDI sectorand less management skill. As for developing host countries, GNP per capita maymore a more important indicator than GDP per capita on setting out the target ofeconomic growth.