Vietnam Anticipates Significant Investment Surge from South Korea
Hanoi, The Gulf Observer: Vietnam is set to experience a substantial wave of investment from South Korea, amounting to tens of billions of dollars, as reported by the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment.
At the 2024 Vietnam-Korea Plus Partnership Week in Ho Chi Minh City on Tuesday, Đỗ Nhất Hoàng, Director of the FIA, highlighted South Korea’s prominent role as one of the leading investors in Vietnam. As of June, South Korea had invested nearly US$87.5 billion across more than 10,000 projects, with manufacturing accounting for nearly 75% of this investment.
Hoàng praised South Korean firms for their efficient project execution, high quality and technological advancements, social responsibility, employee care, and strict legal compliance. He also acknowledged South Korea’s significant contribution to Vietnam through official development assistance (ODA), which comprises 20% of South Korea’s total ODA. These contributions primarily fund urban transport infrastructure, education and training, environmental initiatives, clean energy, and information technology.
The anticipated surge in investment follows Prime Minister Phạm Minh Chính’s visit to South Korea in July, during which he met with leaders of 14 major Korean companies planning to invest billions of dollars in Vietnam.
Vietnam is increasingly selective about foreign direct investment (FDI), prioritizing quality, efficiency, and sustainability. The country focuses on sectors such as electronics, semiconductors, renewable energy, digital economy, digital transformation, high-tech agriculture, financial centers, innovation, and research and development. Vietnam also encourages foreign investors to collaborate with domestic businesses.
To attract FDI, Vietnam has worked diligently to stabilize its economy, accelerate institutional and investment environment reforms, develop infrastructure and high-quality human resources, prepare unencumbered lands to meet investors’ needs, promote supporting industries, and implement policies to support new investors. The country also fosters digital, green, and energy transformations, advances information technology infrastructure, and holds regular dialogues with investors to address their challenges.
Lee Ji Hyung, Head of the Korea Trade-Investment Promotion Agency’s international trade and economic collaboration division, noted that since establishing diplomatic relations in 1992, ties between Vietnam and South Korea have flourished in many areas, including investment and trade. Bilateral trade increased from $490 million in 1992 to $79.42 billion in 2023. Vietnam was South Korea’s third-largest trading partner in 2023, following China and the US, and also ranked as the third-largest investment destination from 1980 to 2023.
Organized by KOTRA, the 2024 Korea-Vietnam Plus Partnership Week includes a Vietnam-Korea Co-operation Forum on promising future fields (smart industries) on July 16, a B2B matching program for smart industries, a seminar on prospective ODA projects on July 17, and a Korea Shopping Festival from July 17 to 21.
Lee expressed hope that these events would provide Korean enterprises with technological capabilities the opportunity to participate in key infrastructure projects in Vietnam, such as subways, highways, and LNG plants.
At the Vietnam-Korea Co-operation Forum on promising future fields in Ho Chi Minh City, 150 delegates from the government and businesses of both countries discussed opportunities and solutions to enhance bilateral cooperation. Vietnamese and South Korean businesses also signed two memorandums of understanding for cooperation during the event.
