Global economic growth has slowed down, and Vietnam is no exception. Vietnam's GDP forecast is expected to grow by 5.05% in 2023, 1.45 percentage point below previous estimate. Despite this, there are bright spots in public investment and Foreign Direct Investment (FDI) projects; capital from China, Hong Kong, and Taiwan has flowed back into Vietnam, focusing on electronic components, renewable energy batteries, and auxiliary industries. Moreover, Apple’s supply chain gradually shifted to Vietnam becoming increasingly evident.
Vietnam Dragon Securities (VDSC) found that in 2023, there are 9 new construction projects related to Apple’s supply chain in Vietnam, with a total investment of approximately USD 1.7 billion. Additionally, there were 7 expansion investment projects totaling about USD 2.6 billion. The research also reveals that Apple's partners such as BOE Technology, Foxconn, GoerTek, and Quanta Computer have invested billions of dollars to set up factories in Vietnam.
Benny Miao, head of corporate finance and Southeast Asia at Cathay United Bank (CUB) pointed out, "Vietnam remains attractive to foreign investment, the evidence is the stable influx of foreign capital."
According to Vietnam's Ministry of Planning and Investment (MPI), China's investment in Vietnam in 2023 amounted to USD 4.471 billion, while Taiwan's investment was USD 2.884 billion. When considering the cumulative total investment, Taiwan ranks fourth and China sixth among 144 investing countries and regions in Vietnam.
Chinese investment sectors have expanded beyond traditional areas such as restaurants, hotels, and consumer goods, these investments have extended into manufacturing industries like power, electronics, tire production, textiles, and footwear in recent years. China's Ministry of Commerce (MOFCOM) spokesperson Shu Jueting stated that investment cooperation between the two countries in green development, digital economy, and other fields will rise continuously.
The latest report from Savills Vietnam indicates an increasing demand for solar products in Vietnam, particularly in the northern region. China's Trina Solar has emerged as the largest investor in Yen Binh Industrial Park in Thai Nguyen Province. Currently, 2 factories are in stable operation. The company plans to build a third factory, with an estimated investment of about USD 420 million. This anticipated investment is poised to become Trina Solar's largest overseas investment in the solar energy sector.
On another front, Vietnam possessing various free trade agreements (FTA) and tariff preferences, has attracted a significant amount of foreign investment. Especially with the promotion of China+1 strategy and the New Southbound Policy, Taiwanese companies are gradually considering Vietnam as a destination for production and manufacturing.
Besides Taiwan and China, Singapore, Hong Kong, and Japan are also taking a fancy to Vietnam due to its lower costs of labor, land, and capital; also, have progressively increased their investment scale in Vietnam in the past few years.