Last weekend, more than 600 guests, including economists, government officials and business leaders from ASEAN member countries, China, Hong Kong, etc. attended the annual regional conference “Gateway to ASEAN” 2024 organized by UOB Bank in Ho Chi Minh City.
This is the first year the Conference is held in Vietnam after two years in Singapore and Indonesia. With the theme “ASEAN: Crossroads of World Economic Integration” , the Conference discusses in depth the great potential and opportunities of ASEAN and Vietnam.
ASEAN: An important position in the global economic picture
Speaking at the workshop, Mr. Wee Ee Cheong, Vice President and General Director of UOB Bank Singapore, emphasized that ASEAN is on track to become one of the world's largest markets by 2030. With the advantage of connectivity to important global markets, free trade agreements that help reduce barriers to market entry, a large and young population, and a rapidly growing middle class, the region is attracting record FDI inflows.
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| Mr. Wee Ee Cheong, Deputy Chairman and General Director, UOB Bank (Singapore) delivered the opening speech at the Conference. |
Last year, ASEAN attracted a record $226 billion in FDI, up 1% year-on-year, while global FDI fell 2%. ASEAN is now the world’s second-largest FDI destination after the US ($310 billion) and ahead of China ($160 billion). This confirms ASEAN’s attractiveness in the context of the region’s total GDP reaching $3,600 and expected to grow by around 5% this year.
According to experts shared at the Conference, after the trade tensions between the United States and China and the Covid-19 pandemic, there has been a significant shift towards resilience, diversification and security of the supply chain. There has been a shift of production activities from China to nearby countries, challenging China's position as the world's leading manufacturer and exporter.
Mr Frederick Chin, Head of Wholesale Banking and Markets, UOB (Singapore), said that UOB has seen some clients adopt a China plus one strategy by investing in new manufacturing facilities to serve the needs of the broader market, such as a number of new manufacturing facilities established across ASEAN, in areas such as electrical consumer products in Thailand and Vietnam, semiconductors in Singapore and Malaysia, nickel industry in Indonesia, electric vehicles in Thailand, etc.
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| Mr. Frederick Chin, Head of Wholesale Banking and Markets, UOB Bank (Singapore) (right) shares about the great opportunities for the ASEAN region. |
Mr. Frederick Chin also emphasized three clear opportunities for ASEAN.
First, the region is an important manufacturing base for China and the rest of the world.
Second, the rise of the digital economy is predicted to reach $1,000 by 2030.
Third, the green economy in the region is also expected to require an investment of US$1,500 billion by 2030.
“Therefore, there is no better time than now to invest in ASEAN,” Mr. Frederick Chin emphasized.
Vietnam: One of ASEAN's Fastest Growing Economies
Emphasizing the role of ASEAN, including Vietnam, Mr. Phan Van Mai, Chairman of the Ho Chi Minh City People's Committee affirmed that ASEAN and especially Vietnam are developing the fastest in the current global economy and continue to be the growth engine of the world economy.
According to forecasts from organizations such as the World Bank and the IMF, ASEAN and Vietnam's growth will continue to reach high levels in 2024 and the following years, along with advantages when Vietnam currently has 19 bilateral and multilateral free trade agreements (FTAs); Ho Chi Minh City alone has attracted investment from 125 countries and territories, of which Singapore is the largest investor with nearly 2,000 projects....
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| Mr. Phan Van Mai, Chairman of Ho Chi Minh City People's Committee, shared about favorable factors to attract foreign investment in Ho Chi Minh City. |
“Vietnam’s consistent and consistent orientation is to pursue the trend of peace, friendship, cooperation and mutual development with partners. And ASEAN, including Vietnam, is affirmed to be the fastest growing region of the global economy, continuing to be the driving force of world economic growth,” Mr. Phan Van Mai emphasized.
Vietnam now accounts for about 12% of ASEAN's total GDP, up significantly from less than 6% in 2000. With a population of about 100 million and an expanding middle class, Vietnam is becoming an attractive destination for international investors. In addition, international trade has maintained a strong recovery in the first half of 2024, and the increase in semiconductor sales from mid-2023 is expected to continue in the second half of 2024. In the first half of 2024, exports and imports increased by 14.0% and 16.6% year-on-year, respectively.
Vietnam is attracting large investments in various sectors, of which the processing and manufacturing industry remains the main sector attracting FDI in Vietnam, attracting more than 72% of total investment capital by 2023. This is in line with the long-standing trend of Vietnam being an important destination for manufacturing due to its competitive labor costs, developed infrastructure and business-friendly policies. As an important link in the global supply chain, Vietnam has become a favorite destination for corporations looking to diversify their production activities in the context of global instability, supply chain restructuring and the “China+1” wave.
Regarding Vietnam’s economic prospects, Mr. Victor Ngo, General Director of UOB Bank Vietnam, also said that in the ASEAN region, Vietnam stands out as a gateway to the region. Its strategic location, large and young population, and friendly policies make Vietnam an attractive destination for businesses looking to exploit ASEAN’s growth potential.
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| Mr. Victor Ngo, General Director of UOB Vietnam, affirmed UOB's role in promoting and supporting foreign enterprises to invest and develop in Vietnam. |
With its mission of being a regional bridge, UOB has supported many global businesses in expanding their operations in Vietnam. The bank's leaders said that in the past 5 years, the bank's FDI advisory unit has supported 300 companies from other countries to expand into Vietnam. Accordingly, these companies have committed to invest 7.3 billion Singapore dollars along with plans to create jobs for more than 50,000 workers in Vietnam.
“As a bank for ASEAN, UOB remains committed to playing a catalytic and enabling role. Our deep regional connectivity and extensive support network that extends to governments, investors and our ecosystem of partners enable us to best support Vietnamese and ASEAN businesses. With our long-term commitment to the region and continued investment in Vietnam, UOB helps businesses confidently overcome challenges and deliver innovative solutions to realise their full potential,” said Mr. Victor Ngo.
The conference ended successfully and provided valuable information for businesses while creating opportunities for business networking, promoting trade and investment in the region thanks to UOB's most extensive trade network in the region.
It is known that in addition to the two main discussion sessions, the event continued with three thematic discussion sessions including session 1 "Development in ASEAN through Vietnam", session 2 "Innovation with sustainability" and session 3 "Sustainable supply chain management experience" with speakers and guests from global enterprises such as DHL Express Vietnam, Thanh Cong Bien Hoa Joint Stock Company, Coca Vietnam, Schneider Electric in Singapore and Brunei, Marou Chocolate, Intertek...
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