VietNamNet Bridge - Thai businesses are believed to be the most active investors in Vietnam pouring capital into Vietnam to prepare for the ASEAN Economic Community (AEC), which takes effect in late 2015.

Following Amata’s move, Hemaraj, a large Thai real estate group, is also seeking opportunities to develop industrial zones (IZ) in Vietnam in anticipation of the new investment wave sourced from Thailand and other countries.

Hemaraj’s representatives two weeks ago had a meeting with Ba Ria – Vung Tau provincial leaders to discuss the possible positions for IZ. The group chose Ba Ria – Vung Tau because of its largest seaport system. 

The province has many large investment projects, including the petrochemistry and oil refinery project invested by PetroVietnam, Thai SCG Group and Qatar International Petroleum.

In July 2015, Amata Group received an investment certificate for its Long Thanh High-tech Zone project capitalized at $282 million – the second project of the group in Vietnam. 

Its third project would be developed in the northern province of Quang Ninh – a complex of IZ, urban area and scientific research center with total investment capital of $2 billion.

Somhatai Panichewa, President of Amata, said at a working session with the Ministry of Planning and Investment that Vietnam was very attractive to Thai businesses, especially because AEC will be operational in 2016.

Duangdej Yuaikwarmdee, deputy director of AEC, an industry exhibition organizer, noted that AEC would create a shift of investment in the region as manufacturers would relocate factories in places where they can make products at lower costs.

Meanwhile, Vietnam has lower labor costs than Thailand, where the average wage has been increasing rapidly. 

A report from the Foreign Investment Agency (FIA) showed that Thailand registered 20 new projects and expanded six projects in Vietnam in the first eight months of 2015. By the end of August, Thailand had 399 foreign direct investment projects in Vietnam.

An analyst noted that the large market of Vietnam was also a factor luring Thai investors. While the Vietnamese population has nearly reached 100 million, the Thai market is smaller with 60 million consumers. Therefore, Vietnam is an ideal destination for Thai retailers and consumer goods manufacturers.

Thai BJC has announced a plan to take over Metro Cash & Carry, a German retail chain, at $800 million. Though having encountered problems recently, Charoen Sirivadhanabhakdi, who holds a large stake in BJC, has shown his determination to buy the retailer through TCC Holdings, where he is the owner. 

The Thai billionaire explained that once Thailand obtains a retail chain in Vietnam, they would be able to bring Thai goods to Vietnam more easily.

DDDN