A promising future for Vietnam after COVID-19
With an increasingly open business environment, and continuing international integration, Vietnam has long been regarded as a promising destination for foreign investment.
A photo of an AirPods Pro case printed with "Assembled in Vietnam". — Photo courtesy Twitter @alixrezax
Its recent success in containing and combatting the coronavirus pandemic, with just 355 cases and no deaths reported as of June 30, could enhance its reputation even further.
In our recent survey of over 200 readers, an incredible 87.2 per cent of respondents said they agreed or strongly agreed with the statement ‘Viet Nam is a more promising investment destination’. Many will be waiting for the resumption of flights for the tourism sector to recover, however, this suggests investors will be making their own plans to touch down in Viet Nam.
Giles Cooper, Co-Director of Duane Morris Vietnam, agreed with the sentiment, saying: “Viet Nam can be rightfully proud of its handling of the COVID crisis. Its response proves the ability to engage all of Government in a coordinated effort in pursuit of a common goal.”
Prior to the outbreak of COVID-19, Viet Nam was already seeing an influx of foreign businesses, most looking to move manufacturing away from China and avoid the impacts of current global trade tensions. Viet Nam’s exemplary handling of the pandemic, in stark contrast to other, more developed, nations, is only accelerating this process.
“There is clear and immediate interest from multinationals wanting to move operations to Viet Nam, building on momentum already established following bellicose US-China trade rhetoric,” Cooper went on to say.
In addition to a top-notch virus response, Viet Nam boasts political stability, continuing rapid and sustainable economic growth, as well as increasing per capita income.
Samsung has long had a manufacturing presence in the country, but now another tech giant – Apple – is making the move by shifting some production away from China. With a young workforce and growing technical expertise, it’s likely we’ll see more big names lured by Viet Nam’s promise.
Ousmane Dione, World Bank Country Director for Viet Nam, told Viet Nam News: “The COVID pandemic provides a fantastic opportunity for Viet Nam to position itself in attracting more businesses, FDI and investment.
“Viet Nam today is one of the very few countries across the world which can be qualified, to some point, as a ‘corona-free’ country. As enterprises currently, after the ‘shock’ related to the COVID pandemic, are revisiting their strategy with respect to how to diversify and how to minimise the risks associated with global value chain disruption, Viet Nam provides a unique opportunity for relocation.”
Already opening back up after a short period of social distancing, Viet Nam looks to be one of the first countries out of the gate in restarting its economy.
Following several years of strong GDP growth, 2020’s figures are sure to take a dip due to the country’s large tourism industry. However, the quick and effective handling of coronavirus “showcases what Viet Nam is capable of and is especially relevant when considering the motivation to use large-scale, multi-stakeholder infrastructure projects, supported by a brand-new Public-Private Partnership (PPP) Law, as a means of mitigating the worst of the inevitable economic impact,” Cooper said.
“Attracting investment capital is part marketing and Viet Nam’s COVID success story so far is a big PR win.”
With new-generation deals like the EU-Viet Nam Free Trade Agreement (EVFTA) coming into force, “it’s clear that Viet Nam has, by no accident, positioned itself extremely well to face the uncertain times ahead,” Cooper said. — VNS
Vietnam’s gross domestic product (GDP) increased 1.81 percent during the first six months of 2020, the lowest first-half growth pace since 2011, according to the General Statistics Office (GSO).
The aftermath of the health crisis has prompted Vietnam to consider adjusting its economic growth target,