HANOI: Vietnam has witnessed major investment projects from Korean companies within the past week, including a $1.4 billion initiative from Samsung Electronics that was launched today in Ho Chi Minh City. Several other investors from Korea are also expected to come in, bolstered by the free trade agreement between the two nations, that was signed earlier this month.
Ha Nam, a northern province of Vietnam, has attracted two Korean investment projects worth a total of $160 million.The latest investment is a wireless device manufacturing factory by Ace Technologies Corp, with a capital of $60 million.
The 120,000 square metre plant will produce 300,000 products of station antenna for wireless communications and radio frequency filter, per year. Granted license on May 18, the plant is expected to be inaugurated after nine months, and to generate an annual revenue of $70 million.
The Korean tech firm chairman, Gwang Young Koo, said his company will develop the Vietnam-base unit into its third largest subsidiary, which will actively contribute to the group’s goal of reaching $1 billion in revenues per year.
Prior to Ace Technologies, on May 13, KMW Vina Co Ltd, wholly invested by Korean capital, started construction of its $100 million factory for LED lighting and telecommunications equipment. This is one of the largest investments in the province.
In alignment with the schedule, the factory, built in a 30 hectare area, will be completed by December this year. The anticipated capacity is 220,000 telecom equipments and 380,000 lighting products per year.
One of the Ha Nam province’s policies is to attract hi-tech and mechanical engineering companies. The provincial authorities have also asked the investors to introduce more Korean firms into the local investment scene.
In addition to Ha Nam, a larger project ($1.4 billion) from Samsung Electronics, call the Samsung Electronics Hi-tech Complex (SEHC), was kicked off on Tuesday in Ho Chi Minh City.
Samsung Group, the world’s second largest conglomerate by revenue and Vietnam’s largest investor, said that this project is an important link in its global TV supply chain, and would help the company retain its number one position in TV production since 2006.
In turn, Nguyen Quan, Vietnam’s Minister of Science and Technology, said: “We hope Samsung will help Vietnam develop our auxiliary industry and manufacture advanced technology products.”
Since its foray into the Vietnamese market in 1995, Samsung has now invested $11.2 billion in the country. Apart from electronic products, Samsung is working on plan to investment in Vietnam’s energy, shipbuilding and transportation sectors, which will potentially increase the total investment of the chaebol (Korean for conglomerate) in the Southeast Asian country to $20 billion.
With the inking of the Vietnam Korea Free Trade Agreement (VKFTA) earlier this month, bilateral trade is expected to triple to $70 billion within the next five years. Foreign direct investment (FDI) flows between the two nations are also predicted to flourish, due to extensive investment and tax incentives.
