Vietnam: Destination for Western European and North American Investors in Chip Manufacturing and Renewable Energy

In addition to traditional investors from Northeast Asia and Singapore, Vietnam is welcoming new investment flows from Western Europe and North America.

Vietnam has attracted many large investors in high-tech sectors. In the photo: Workers working inside the Ho Chi Minh City High-Tech Park - Photo: NGOC HIEN

At the Vietnam Industrial Real Estate Forum (VIPF) organized by Dau Tu newspaper on August 24, Mr. Do Van Su - Deputy Director of the Foreign Investment Department (Ministry of Planning and Investment) - said that there is a shift of capital from Western European and North American investors to Vietnam.

Investors want to produce chips, renewable energy in Vietnam

According to Mr. Su, the top 5 largest investment destinations in Vietnam are mostly investors from Northeast Asia and Singapore. However, recently, there has been a relative shift in investment capital from Western European investors such as Germany, the Netherlands, France, and Spain into renewable energy industries.

Besides, there is also an increasing presence of North American investors, especially US investors in Vietnam.

According to Mr. Su, the US Semiconductor Industry Association recently came to Vietnam with many businesses to learn about the investment environment to shift chip production.

Mr. Su said that when the Vietnamese Government committed to achieving net zero emissions by 2050, many international energy corporations came to Vietnam to seek investment opportunities in the renewable energy industry.

Besides, a series of processing and manufacturing enterprises also want to invest in Vietnam to produce equipment for the renewable energy industry.

Vietnam must ensure new energy to attract investors

Meanwhile, Mr. Bruno Jaspaert - General Director of DEEP C Industrial Park Complex - said that Vietnam's participation in a series of international trade agreements brings benefits and increases market size for investors.

According to Mr. Bruno Jaspaert, land rental prices in Vietnam are still lower than in other ASEAN countries. In addition, the China +1 trend has become an important channel for Vietnam, contributing to attracting about 10% of manufacturing enterprises to move abroad.

However, Mr. Bruno Jaspaert also noted two major problems that Vietnam must solve, which are labor and energy.

Vietnam is entering the aging population phase, so there will be fewer workers in the future and many people will not agree to work for low wages. Besides, it is predicted that in the next 5 years there may be a shortage of electricity production due to too many investors, so Vietnam needs to build energy infrastructure from today.

Mr. Paul Wee - CFO of BW Industrial Company - said that many large enterprises and corporations have moved out of China in recent years and India, Indonesia, Thailand... are the most attractive destinations for investors.

Therefore, to attract investment, Mr. Paul Wee said that Vietnam needs to improve infrastructure, ensure energy and improve the quality of human resources.

"For large investors, they not only expect infrastructure, but also need assurance of energy supply. They will not accept being notified of a power cut three days in advance and having their factory cut off for 24 hours. Therefore, it is necessary to provide stable electricity services to investors," Mr. Paul Wee emphasized.

Research on building the Law on Industrial Parks and Economic Zones

Deputy Minister of Planning and Investment Tran Quoc Phuong said that the ministry has coordinated with localities and relevant organizations to continue implementing tasks and solutions on the development of industrial parks and economic zones, including researching and proposing the development of the Law on Industrial Parks and Economic Zones to submit to competent authorities for consideration in the coming time.

According to Mr. Phuong, the foreign investment cooperation strategy for the 2021 - 2030 period has set a number of specific goals such as increasing by 50% the number of multinational corporations in the group of 500 largest corporations in the world, increasing the proportion of registered investment capital of countries and territories in some regions (such as Korea, Japan, Singapore, France, Germany, Italy, Spain, UK, USA...) in the total foreign investment capital of the whole country to more than 70% in the period 2021 - 2025 and 75% in the period 2026 - 2030.

In particular, by 2030, Vietnam will be in the top 3 ASEAN countries and the top 60 countries in the world according to the World Bank's business environment rankings.

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