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Although the global financial and economic turmoil is taking a heavy toll on all economies, many groups from the US are pouring investments into Vietnam, hoping to become the leading investor in the country.
Representatives of 21 US corporations, including big names Chevron, Coca-Cola, Caterpillar, and General Electric (GE), recently visited Vietnam to sound out investment opportunities.
GE announced in March 2012 that it will double its 2012-13 registered capital from the current US$61 million to upgrade a wind turbine tower factory in Haiphong city.
In a meeting with Minister of Planning and Investment Bui Quang Vinh on July 10, Stuart Dean, CEO of GE ASEAN, revealed the company’s plan to expand its operations in Vietnam, with healthcare services as the primary target.
Dean said the Haiphong factory is now employing 600 workers, and it will raise that number to 1,000 when its expansion plan is put in place.
According to Dean, the group has decided to invest more in Vietnam because the country still has favourable business opportunities.
It signed a US$16.5 million contract with the Vietnam National Power Transmission Company to supply equipment for the Pleiku-HCM City 500KV transmission line project. The signing was witnessed by US Secretary of State Hilary Clinton during her visit to Hanoi on July 10, 2012.
It seems apparent that many US corporate giants are developing long-term plans to do business in Vietnam. The Intel microchip plant in Ho Chi Minh City has been operating well, generating US$462 million from exports last year.
Another US group, Chevron, is pursuing a cooperation project with the Vietnam National Oil and Gas Group (PVN) to exploit gas in Bloc B. It hopes to finalise negotiations on gas prices with PVN very soon. Chevron wants to bring the latest technology to Vietnam to get the project off the ground soon.
Meanwhile, Jabil, a subsidiary of the American Chamber of Commerce in Vietnam (AmCham), recently funnelled an additional US$70 million into a project to upgrade its plant at the Saigon Hi-tech Park, raising its registered capital to US$100 million.
New wave of US investment
Representatives of various leading US groups such as Coca-Cola, Unilever, Kimberly-Clark, Pepsico, P&G, and Nike, accompanied Clinton on her recent visit to Vietnam.
Intel microchip plant has been operating efficiently in HCM City
These groups are currently operating in Vietnam, and according to an official from the Ministry of Planning and Investment, a further influx of US investment into the country is expected in the near future.
The presence of the representatives from US businesses, which are members of the US-ASEAN Business Council in Vietnam is testimony to the anticipated new wave of US investment in the country, said the official.
Alexander Feldman, chairman of the US-ASEAN Business Council, said US businesses consider Vietnam a potential market, and they want to cooperate more with the Vietnamese Government and businesses in all fields.
The FedEx representative also stated that the Vietnamese market is making positive shifts in the global value chain, and FedEx aims to help accelerate this process by supporting the country in its negotiations for a Trans-Pacific Partnership agreement (TPP) with other partners.
FedEx and other leading US corporate giants have high hopes for success in the TPP negotiations, which will promote trade and investment cooperation amongst relevant parties.
Investment Minister Bui Quang Vinh affirmed that as Vietnam is restructuring its economy, it will focus on high tech, high added value industries, and these are areas in which US businesses are strong, he said.
Trade and investment ties between Vietnam and the US have grown and flourished since the two countries normalised diplomatic ties in 1995 and signed a bilateral trade agreement in 2000, particularly after Vietnam joined the World Trade Organisation (WTO) in 2007.
The US has invested in 621 projects in Vietnam so far with total registered capital of more than US$10 billion, ranking 8th amongst foreign investors in the economy./.
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