The article said while parts of Asia are still recovering from the global pandemic, Vietnam’s economy has boomed, reaching an impressive 8.02% increase in GDP by the last quarter of 2022 – that’s faster than other major regional economies in Asia. Its export revenue hit 372 billion USD, up 10% year-on-year.
Explaining the boom of Vietnam’s industry, it said part of the reason is the disruption to supply chains on the Chinese mainland, Asia’s largest manufacturing hub, as factories were subject to shutdowns during COVID-19. Companies turned to alternative locations to continue and diversify their production streams.
Moreover, Vietnam has a competitive labour force and low manufacturing costs. It has a young and growing population of 97 million, 70% of whom are under 35 – that’s a considerable labour force for the manufacturing industry.
The article also noted that Vietnam is strategically located along a strip of 3,200km coastline which makes the country, particularly the north, an effective location for shipping cargo in and out. The government has been investing in development projects to improve the country’s infrastructure, particularly in the northeastern cities, to create a more attractive travel destination, and ultimately a more connected port and industrial hub, it said.
Another reason is that more companies are moving in Vietnam which is the world’s second-largest manufacturer of tech and apparel, with big brands like Nike, Adidas and Samsung operating across the country. Google’s newest Pixel phone, too, will be made in Vietnam, while Microsoft started shipping Xbox game consoles from Ho Chi Minh City in 2022.
Reports have also emerged that Apple supplier Foxconn is investing 300 million USD to expand their factories in the north of the country, and Dell, HP, Nintendo and Lenovo are all planning on setting up plants in the country as well.
Additionally, the Vietnamese government has been making strong efforts to make trade easier between Vietnam and the rest of the world. The nation has signed several free trade agreements with the EU, UK and nations across the Asia-Pacific, opening up the country to more trade opportunities, especially to the west.
Another strong driver of trade is the Regional Comprehensive Economic Partnership deal to which Vietnam is a member, the article said.
