Samsung Electronics’ investment story in Vietnam has begun a new chapter when the company last week received an investment certificate for the firm’s new $1.4 billion electronics facility in Ho Chi Minh City.
Samsung’s new $1.4 billion facility in Ho Chi Minh City is expected to further strengthen its export figures
The new project, named Samsung CE Complex, will feature research, development, and production of hi-tech consumer electronics products and equipment, the South Korea electronics firm announced.
Located at the Saigon Hi-tech Park, the project will be divided into two stages, the first will focus on production of consumer electronics such as TVs and LEDs while the second will start production of other consumer electronics products.
Samsung has announced that the construction of the project will commence in January 2015 and operations will start in the first quarter of 2016.
“This is Samsung Electronics’ newest project in Vietnam and also a continuation of our Samsung Vina project, but with a wider scope aimed at the export market in the region and across the world,” a Samsung announcement read.
The new investment will increase Samsung Electronics’ total committed capital in the country to nearly $10 billion, with three manufacturing bases in the northern provinces of Bac Ninh and Thai Nguyen, and Ho Chi Minh City.
The project is also a reaffirmation of the company’s announcement that Vietnam would become its global production base.
“Receiving the investment certificate for the Samsung CE Complex is a new milestone on Samsung’s Vietnam journey. This is a remarkable country that is now on the global map of manufacturing and particularly the supply of electronics and mobiles,” the Samsung statement added.
Along with the Bac Ninh SEV and Samsung Hi-tech Thai Nguyen SEVT complexes, the new project will bring Vietnam further into Samsung’s global supply chain.
Samsung Electronics made its first investment in Vietnam in 1995 with its Samsung Vina Electronics factory in Ho Chi Minh City. The factory produces consumer and household electronics. In 2008 Samsung invested in its second project in the country, Samsung SEV Bac Ninh, producing primarily mobile phones. This project saw an initial investment of $670 million but is now capitalised at $2.5 billion after several expansions. Samsung then put $3.2 billion into its complex in Thai Nguyen, which has been in operation since March 2014.
As the result of its expansion in Vietnam, Samsung is now the largest exporter in the country. In 2013 Samsung SEV Bac Ninh alone reported more than $20 billion in the export turnover, accounting for 18 per cent of Vietnam’s total export turnover. This helped Vietnam reach a trade surplus for the first time in around 20 years.
The South Korean group’s revenues in Vietnam are expected to further shoot upwards when the Thai Nguyen factory reaches full production capacity and the Ho Chi Minh City plant begins operating.