Asian firms keen to expand in VN

A production line of electronic spare parts at South Korean SYNOFEX Việt Nam Company in Quang Minh Industrial Park in Hà Nội. Việt Nam has attracted Asian companies thank to its stable political and economic climate as well as large and growing customer demand. - VNA/VNS Photo Danh Lam

Enterprises from Malaysia (38 per cent), Thailand (35 per cent) and Singapore (29 per cent) ranked Việt Nam as one of their top-three expansion destinations, according to the UOB Asian Enterprise Survey 2016.

The enterprises were among the 28 per cent of all 2,500 surveyed respondents who chose Việt Nam as their favoured expansion destination in the next three to five years.

Asian enterprises said they were drawn to Việt Nam’s stable political and economic climate (41 per cent), large and growing customer demand (40 per cent) and favourable tax and regulatory environment (35 per cent).

With an economic growth of 6.7 per cent last year and 60 per cent of its 90 million people under 35 years old, Việt Nam continues to be an attractive destination for investment.

In the first half of the year, the country received a record US$11.3 billion in foreign direct investment (FDI), a surge of 105 per cent from the same period last year.

Eric Tham, head of Group Commercial Banking at UOB, said the findings from the survey reaffirmed the entrepreneurial spirit of Asian enterprises.

Speaking at an investment forum organised by UOB in HCM City last week, Tham said the top industry sources of foreign investment into Việt Nam included key sectors, such as manufacturing, healthcare, pharmaceuticals, construction, real estate, and energy and natural resources sectors.

Growth in these key sectors is expected to build a strong foundation to support long-term economic growth.

“Investments in Việt Nam will also create more jobs and boost income. This in turn will open doors for new economic opportunities as Việt Nam’s growing urban population and expanding middle class start spending more on consumer goods, and on healthcare services to ensure their personal health and well being. In addition, Vietnamese enterprises will benefit from collaborating with foreign companies in the areas of knowledge sharing and skill transfer,” Tham said.

Last year a Memorandum of Understanding (MoU) was signed between the Foreign Investment Agency (FIA) and UOB aimed at increasing investment and trade between Việt Nam and Southeast Asia.

Tham said while Việt Nam’s economy could be affected by global market uncertainties stemming from a precipitous drop in oil prices and tepid consumer demand in the West, Việt Nam’s rapid development presents many opportunities for Asian businesses.

With its head office in Singapore, UOB has a global network of more than 500 offices in 19 countries and territories in the Asia Pacific, Europe and North America.