Tuesday,  Feb 19, 2019,00:05 (GMT+7) 0 0
Vietnam to benefit from FDI shift from China
By Thuy Dung
Friday,  Aug 31, 2018,12:09 (GMT+7)

Vietnam to benefit from FDI shift from China

By Thuy Dung

Vu Tien Loc, president of the Vietnam Chamber of Commerce and Industry (VCCI) – PHOTO: TTXVN

HANOI – Trade tensions with the United States and rising business costs in China have prompted many multinational companies to move their investments south, including to Vietnam, experts have said.

According to Vu Tien Loc, president of the Vietnam Chamber of Commerce and Industry (VCCI), multinational companies used to invest in China as it was considered a huge market with low labor costs.

However, trade tensions between the United States and China have raised concerns among investors over potential export barriers. Moreover, labor costs in China are no longer cheap.

Vietnam is an important destination in potential “move-south” plans, Loc told a press meeting on the 2018 Vietnam Business Summit in Hanoi on August 30.

Vietnam has a strategic position and a number of free trade agreements in place. The country also has wide trade openness with the ASEAN countries, facilitating exports and trade between these countries, Loc explained.

According to a 2017 survey by the Japan External Trade Organization, a large number of Japanese enterprises in Vietnam (60%) have produced expansion plans for the next two years. Meanwhile, this figure is below 60% in ASEAN countries and only some 40% in China.

South Korean and Taiwanese investors are also planning to move south, and Vietnam is one of their target destinations.

The upcoming business summit to be held by the VCCI on September 13 will focus on the connectivity and innovation features of Vietnam.

A new wave of investments in Vietnam is expected because of its cheap labor and large market size as well as its connectivity and innovation advantages, Loc said.

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