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Korean investors pour billions of USD into Vietnam

South Korea is now one of the top three foreign investors in Vietnam.

Thai Nguyen Province recently approved Samsung Electro-Mechanics Vietnam’s US$920 million expansion project, raising the investor’s total investment in the province from $1.35 billion to $2.27 billion. The factory manufactures and assembles components for telecommunication and hi-tech mobile devices, and other electrical and electronic products.

South Korea’s foreign direct investment (FDI) in the manufacturing and processing industry accounts for more than 70 percent of its total investment. 

Real estate is also a field that attracts South Korea’s FDI, which doubled in 2018 compared to 2018 and made up 13 percent by 2021.

In early 2022, Vietnam welcomed new Korean-invested projects, including a $900 million Lotte Eco Smart City Thu Thiem project in HCM City.

The YSL Group is implementing the Nam Binh Xuyen 300-ha Industrial Park project in Vinh Phuc Province. Logistics and smart warehouses are also attractive to Korean investors.

According to the Ministry of Planning and Investment (MPI), South Korea was in the top three investors in Vietnam in the past three years. It was the second largest investor in the first five months of 2022 with $2.06 billion of registered capital, up 12.6 percent year on year.

Regarding the number of projects, it is the top investor with 112 projects. It has the most adjustments, accounting for 36.7 percent of total capital contributions and share purchases.

Andrew Lee from Savills Vietnam said Korean investment in the value chain is becoming clearer. Most of the outstanding projects are in the key northern economic zone, while projects in traditional industries such as textile and garment and power are in southern industrial zones.

He said Vietnam is the ideal destination for businesses which want to diversify their investments to avoid reliance on one country in the supply chain.

The localities with advantageous geographical conditions, near border lines and seaports, together with developed infrastructure, are attractive destinations for investors

Duy Anh

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