Workers at an electronic spare part manufacturing plant in Vietnam (Source: VNA)Hanoi (VNA) – An article published by US magazine Forbes has recentlyconsidered Vietnam as the hottest investment destination in Asia.
According tothe article, Vietnam attracted 17 billion USD in FDI commitments last year,arguably the largest for an emerging market relative to its 250-billion-USDGDP, the magazine said.
In the firstquarter of 2018, it became the fourth largest Initial Public Offering market inthe region, surpassing the Republic of Korea (RoK), Singapore and Australia.The realty market in Ho Chi Minh City is booming and GDP is growing at about7 percent per annum.
It said theComprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP)and EU-Vietnam Free Trade Agreement (EVFTA) are expected to be ratified in thecoming months, helping Vietnam further integrate in the global economy.Meanwhile, in 2020, the capital Hanoi will host the Formula 1 Grand Prix.
Explainingthe reason behind such progresses, the article pointed to the fact that thecountry’s leadership has agreed on an economic development vision that focuseson offering highly productive, cost effective labour for labour-intensiveexport manufacturing. This has driven record FDI inflows, largely from moremature Asian economies such as Japan, the RoK, and Taiwan (China), of whichover 90 percent are going into manufacturing. It said Vietnam has becomeintegral to the global supply of many goods, from smartphones and electronicsto catfish and cashews. The country is also poised to be a major beneficiary ofthe ongoing US-China trade tension, as foreign companies seek to restructuretheir supply chains.
The articlenoted the government’s plan to equitise hundreds of state-owned enterprises(SOEs) has been critical to Vietnam’s growth story. It said the equitisation isattracting a flood of portfolio investment across several sectors, most notablyconsumer and healthcare. According to the writer, such investment interest islikely to accelerate, following recent legislation drafted by the localMinistry of Finance, which stipulates that foreign ownership caps on listedcompanies - currently at 49 percent - will be lifted in 2019.
In addition,it mentioned the country’s young, educated entrepreneurial population of 95million, which is rapidly urbanising and experiencing real spending power forthe first time.
The article said it is easy to understand why international brands like Apple,Starbucks and McDonalds are betting big on Vietnam, adding that the country’stech scene is also thriving.-VNA
VNA
