Singapore’s firms hunt new markets

Logistics is one of the sectors Singapore’s commercial presence focuses on, Photo: Le Toan

According to the Ministry of Planning and Investment, Singapore is Vietnam’s third largest source of foreign direct investment, with cumulative committed investment of $30.5 billion.

During the 10th Singapore-Vietnam Connectivity Ministerial Meeting, held in Singapore in April between the Ministry of Planning and Investment and Singapore’s Ministry of Trade and Industry, the two sides agreed to continue pursuing greater economic collaboration and to temper stronger bilateral economic ties.

A third of the investment from Singapore into Vietnam in recent years has been committed to the industrial manufacturing sector. Most of the investment was implemented by multinational companies through subsidiaries in Singapore. Investment in property also accounted for a third of the total with expansion from Singaporean property developers like CapitaLand, Keppel Land and Mapletree.

But Lim Hng Kiang, Singapore’s Minister of Trade and Industry, believes the investment from Singapore into Vietnam will expand in a wider range of sectors, including urban solutions, retail and food services, logistics, telecommunications as well as tourism and hospitality.

“Noting the strong growth in bilateral trade and investment between the two countries over the past decade, both sides agreed that there is potential to deepen and expand collaboration,” Lim said in a press release of Singapore’s Ministry of Trade and Industry.

“Vietnam and Singapore are long-term trade and investment partners. With urbanisation and rapid economic growth in Vietnam, there is scope for further collaboration between the two countries across a diverse range of sectors. I would encourage companies to continue exploring business opportunities in Vietnam,” he added.

Jason Yang, president of Singapore Business Association in Vietnam, also thinks Singapore-based companies are interested in urban solutions, retail, telecommunications, tourism and hospitality.

“Singaporean companies in Vietnam will have to explore the private sector, entrepreneurs and government- invested companies for opportunities. Some came into Vietnam for business back in 1989, while others have just arrived, but we all face cross-cultural management. I’ve seen many changes during the past 5-8 years but still see more room for improvement for all foreign companies investing in Vietnam,” said Yang.

Indo Trans Keppel Logistics Vietnam kicked off construction of its 1.5-hectare facility in VSIP I Binh Duong in the second quarter this year. Once completed, the complex will provide cargo handling, customs clearance, freight forwarding and warehouse services. With total investment capital of $5.5 million, the cargo complex will become operational in the first quarter of 2015.

In terms of tourism and hospitality, Banyan Tree Holdings last year inaugurated its luxury integrated Laguna Lang Co resort in Thua Thien Hue. The People’s Committee of Kien Giang province also reported that several Singaporean companies were interested in developing tourism and hospitality on Phu Quoc Island.