VietNamNet Bridge - Will the increasingly high investments by mainland China, Taiwan, Hong Kong and Macau bring opportunities or challenges?

Macau’s Sun City has expressed its intention to develop a casino project on Phu Quoc Island of Vietnam’s Kien Giang province, capitalized at no more than $4 billion.

Sun City and the well-known real estate group from Hong Kong Chow Tai Fook are the partners of VinaCapital, the largest investment fund management company in Vietnam, in a project to develop a $4 billion high-end amusement complex with casino in Hoi An in Quang Nam province.

The construction of the complex is scheduled to kick off in mid-2015.

Chinese-speaking economies have also poured money into many other business fields in Vietnam, from textile & garment, real estate, steel to finance, energy and infrastructure.

In 2014, the economies registered $3.6 billion worth of investments in Vietnam, becoming the second largest foreign investor in Vietnam, after South Korea.

International experts noted that Chinese investments reach out to many other countries in South East Asia, developed countries in North America, Europe, and Africa as well.

Reuters reported that the Chinese outward investment in 2014 increased sharply by 14.1 percent to the record high of $102.9 billion. Meanwhile, the world’s investment in China increased modestly by 1.7 percent to $119.6 billion.

The tendency continued in the first two months of 2015 with the increases of 51 percent and 17 percent, respectively.

The figures show Chinese attempt to gain the initiative in the “game”. After tens of years being  the destination point of the world’s investors. The second largest economy has accumulated a large trade surplus and foreign exchange reserves, becoming powerful enough to create impact on the world’s economy.

This is one of the aims of the Chinese leadership.

The Chinese economy is believed to gradually shift from manufacturing industries to services. 

Manufacturing industries, which helped hundreds of millions of Chinese people escape from poverty, will not be encouraged in the new development period, because they cause environmental pollution.

The increased labor cost and the economic growth slowdown in the country has also forced Chinese investors to look for opportunities in other countries.

Moreover, the anti-corruption policy with the tightening on individuals’ assets has frustrated Chinese plutocracy. Macau’s casino, for example, has seen revenue decreasing dramatically in recent years because of a sharp fall in clients from mainland China. 

The new circumstances, according to analysts, have forced large Chinese corporations like Sun City to find new destination points.

Vietnam is an ideal destination point in their eyes, because it is not far from China, which allows the corporations’ owners to control their overseas business.

NCDT