Behind the story of the Apple partner leaving Vietnam to choose Indonesia and the question of whether Vietnam can welcome the wave of prosperity is shifting from China? - Photo 1.
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Behind the story of the Apple partner "abandoning" Vietnam to choose Indonesia and the question of whether Vietnam will welcome the wave of prosperity is shifting from China?


FDI in May reached a record increase of nearly 17 billion USD, an increase of 69.1% compared to the same period in 2018. Particularly, the flow of investment from China had a spectacular increase, up to 450%. This is believed to be partly due to escalation of the US-China trade war.

But also in May, besides the positive news about increased foreign investment, Vietnam also received an unhappy news when Pegatron, the assembly company for Apple, decided to pour 300 million USD into Indonesia to avoid trade conflicts, instead of the original plan for Vietnam. The reason given is that human resources in Vietnam do not meet the demand.

Businesses that leave China to another country have become a trend in which trade war is part of the reason. The cost of labor in this country, which is one of the important factors that helps this place become a world factory, is no longer cheap. On the other hand, the Chinese government is also in the strategy of restructuring the economy: eliminating outdated production chains, environmental pollution, using less labor.

Combining these factors makes a wave of business migration from China real. This migration has been allocated from China and has a tendency to invest in China and now choose another country.

"Trade war is a real opportunity for foreign countries," Duc Thanh said. The prosperous Southeast Asian countries began in the 1980s when business from Japan massively moved due to trade tension between the country and the United States. This prosperity lasts for 20-30 years.

The story of China today is similar. The question is, does Vietnam, as the "bridge" directly connected between Southeast Asia and China, gain this position?

"I'm afraid not to be very optimistic," Mr. Thanh commented and shared information from the former Japanese ambassador that 20,000 Chinese businesses in the mainland are struggling to find a way.

FDI into Vietnam, according to Mr. Thanh, despite the tendency to increase strongly due to the impact of trade war but there is a flow of investment.

For businesses and production chains with developed technologies like the US and Japan, they often calculate very carefully before deciding to pour capital. "Vietnam, India or Indonesia … depend heavily on the institutional environment as well as the labor potential," he said.

This means Vietnam is not the number one choice. Malaysia, Indonesia, Thailand … are countries with good infrastructure for them from the past. On the other hand, countries like India are emerging by using English as a parallel language alongside native languages ​​as well as a huge workforce. Therefore, Vietnam is only one of the candidates, even, is somewhat less than the event with Pegatron is evidence.

Meanwhile, in the opposite direction, Chinese enterprises are acknowledging that Vietnam is similar in many ways, according to Mr. Duc Thanh. This leads to a tendency to pour into Vietnam, causing the phenomenon of FDI flows from this country to take the upper hand.

But ultimately, what is achieved is the story of the Vietnamese people, Mr. Thanh said. Vietnam can influence the choice of technology investors, have the potential by improving themselves through the legal system and law enforcement, and can control the investors Poor quality, regardless of country, by raising the selection criteria. Because in fact after 30 years of attracting foreign investment, Vietnam has a different position and the capital factor is no longer the most important thing.


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