Korean investment capital in Vietnam has increased dramatically over the years.

South Korea began investing in Vietnam in the 1990s and quickly became a major partner. As of 2008, there were 2,114 Korean enterprises operating in Vietnam with a total accumulated capital of 18.952 billion USD.

In particular, since the two countries established a strategic partnership in 2012, Korean investment in Vietnam has skyrocketed.

Korean investment capital in Vietnam has increased dramatically over the years - 1 — South Korean investment in Vietnam has increased sharply since 2012. (Photo: Nikkei Asia)

Investment capital increased sharply

According to Nikkei Asia, in 2013, Korean businesses invested 3.8 billion USD in Vietnam. However, just one year later, the investment capital nearly doubled to 6.1 billion USD, helping Korea become the country with the largest FDI capital in Vietnam.

Over the years, this capital has maintained a steady increase. Specifically, in 2015, the investment capital of Korea in Vietnam was 6.72 billion USD; in 2016 it was 7 billion USD; in 2017 it reached 8.49 billion USD; in 2018 it was 7.2 billion USD and in 2019 it was 7.92 billion USD.

In 2020, due to the impact of the Covid-19 pandemic, investment capital decreased sharply but still reached 3.9 billion USD, then in 2021 it increased again to 7.4 billion USD. However, by 2022, due to the global economic downturn, investment capital from Korea to Vietnam decreased to 4.88 billion USD.

However, according to SMCP, this is still the investment partner that makes the most new investment decisions (accounting for 20.4% of new projects, 32.6% of project adjustments and 34.1% of capital contributions and share purchases).

Notably, while in the past, Korean FDI projects in Vietnam were mainly small and medium-sized, now there are a series of large-scale projects, typically Samsung projects in Bac Ninh , Thai Nguyen, Ho Chi Minh City, LG projects in Hai Phong... Thanks to that, Vietnam has become a global production destination for many leading Korean corporations.

Besides, there are many other large projects such as the steel plant of Posco Group with a total registered capital of 1.126 billion USD; the Landmark Tower office-hotel complex project of Keangnam Group with a total capital of 1 billion USD; the Hanoi Plaza twin towers project and high-end office complex with a total investment of 500 million USD of Charmvit Group...

Starting from textiles and now technology, over time, Korean investment capital has expanded to new fields such as construction, real estate, distribution, retail, offices, hotels, insurance... As of 2022, Korean FDI capital in the processing and manufacturing industry still accounts for the highest proportion of total investment capital at 86%.

Korean investment capital in Vietnam has increased dramatically over the years - 2 — Samsung's projects in Vietnam have become successful models of win-win cooperation. (Photo: Nikkei Asia)

The attractiveness of the Vietnamese market

According to the Korean newspaper Newdaily , to have the cooperation like today, we must mention the attractiveness of the Vietnamese market, from development potential to stable political institutions.

Specifically, Vietnam's economic growth rate in 2022 will reach 8.02%, among the highest in the region. The scale of the infrastructure industry in Vietnam is expected to grow at an average of 9.8%.

These are evidences of the outstanding development potential of the Vietnamese economy, and are also an attractive source for Korean enterprises.

Since 2012, major Korean construction companies have continuously increased their presence in Vietnam through large-scale development projects in many localities.

Based on the experience of previous projects in Korea, companies such as Daewoo E&C, Lotte E&C and GS E&C are actively investing in smart urban area construction projects in Vietnam with stable growth and high profits.

Many Korean company leaders consider Vietnam to be an attractive market with high growth potential, according to Newdaily.

Many studies by experts in this country confirm that the Vietnamese Government's expansion of infrastructure development projects based on public-private partnership (PPP) projects - with the goal of promoting growth and diversifying the economic structure - will be a good opportunity for many Korean companies.

(Source: Zing News)

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