Illustrative image (Source: VNA)Seoul (VNA) – Korea JoongAngDaily of the Republic of Korea (RoK) has recently run an article highlightingVietnam’s economic potential.
According to the article, the Vietnamese economy shows potentialto grow even faster than the RoK’s thanks to its fortunate timing. With China’seconomy saturated, many foreign companies, including Korean businesses, areshrinking their dependency on China, creating opportunities for Vietnam.
Korean companies andthose from other countries are rushing to build factories to replace those inChina, where labour costs are no longer cheap, it said.
While Samsung Electronics has been making adjustments to its investments inChina, it has also been expanding investment in Vietnam.
The changing global value chain due to the ongoing US-China tradewar is also speeding up investment into Vietnam. As US companies have beenrelocating their plants from China, recruitment in Vietnam has been step up tomeet the growing number of orders, the article said.
Korean firms’ expanded operations in Vietnam has also helped toimprove social and cultural ties between the two countries, the article said,highlighting the increasing number of marriages between Vietnamese and Koreans.
The article said Vietnam could increase its role as the hub ofKorean production that can also help Vietnam in developing its owntechnologies.
Major Korean groups such as Samsung, LG, Hyosung and Kumho, areinvesting in big production facilities in Vietnam. Hanwha Group made an equityinvestment of 400 million USD in Vingroup, and SK Group invested 470 millionUSD in Masan Group in their bets to take advantage of Vietnam’s growth thatstands at 6-7 percent annually.
Vietnam is now one of the RoK’s main investment destinations asthe flow of Korean capital into the Southeast Asian country reached 50 billionUSD as of 2017.
Meanwhile, the RoK has been Vietnam’s second biggest provider of officialdevelopment assistance (ODA), only after Japan, according to the article./.
VNA
