International technology giants are eyeing Vietnam’s consumer market as the country’s rapid digital transformation offers bright prospects on the back of a new legal framework and an ever-growing demand for innovative technologies.

The Republic of Korea (RoK) is the leading foreign investor in Vietnam in 2019, pouring 7.92 billion USD into the country, accounting for over one fifth of the total flow of foreign direct investment into Vietnam during the year.

Bilateral trade between Vietnam and South Korea is well on track to reach US$200 billion in 2020, said Kim Dong Bae, minister counsellor at the Republic of Korea’s Embassy in Vietnam.

The number of capital contribution and share acquisition transactions conducted by Chinese enterprises in Vietnam in the January-November period of this year skyrocketed by more than 82% over the year-ago period.

There are currently only 10 FDI enterprises listed on local exchanges compared to the tens of thousands of FDI firms operating in Viet Nam.

A recent survey by the Korea Trade-Investment Promotion Agency (KOTRA) showed that 93 percent of Korean enterprises operating in Vietnam expressed satisfaction when investing in the country.

A survey of business leaders in the Asia Pacific region has revealed Viet Nam is a top destination for cross-border investment.

The foreign direct investment (FDI) sector remains the main driver for Vietnam’s achievement of the record high trade surplus in the first 10 months of this year.

It is often heard that Japanese companies have difficulty doing business in and transferring technology to Vietnam because of the great institutional distance.  

Foreign direct investment in the wood processing industry has increased rapidly, especially since 2018, the Viet Nam Timber and Forest Product Association has said.

Corruption increases the cost of doing business, distorts the competitive environment, limits opportunities for investment and widens the growing social inequality, according to a UNDP expert.

The past two years have seen capital flows into Vietnam continue to steadily increase, as well as some of the country’s biggest mergers and acquisitions deals to date. 

Vietnam enjoyed a trade surplus of close to US$11 billion during the first 11 months of the year, with roughly US$1.45 billion being recorded during November, according to the latest statistics released by the General Department of Vietnam Customs.

The new regulation on certificate of origin (C/O) makes it more for Vietnam to obtain $11 billion in woodwork exports this year as planned.

Festo, a German supplier of automation technology and technical education, plans to expand investment in Vietnam to take advantage of the increasing foreign investment and production in the country.

Vietnam has been extremely successful at attracting high-quality FDI, with this investment primarily going into manufacturing and real estate projects, according to Neil MacGregor, managing director of Savills Vietnam.

Encouraging FDI firms to list locally would help supervise their performance as the companies would be managed by not only local authorities but also investors, shareholders, and the local stock exchanges.

The US-China trade war has led toChinese wooden furniture manufacturers moving production to Vietnam, bringing risks to the domestic woodwork industry.

Non-nationals with differing investment scales in Vietnam will be granted different visas in the country, making it more favourable for authorised agencies to apply incentives to certain initiatives.

South Korean investments in Vietnam will focus on developing industrial urban infrastructure, green and smart cities, shopping centers, hotel complexes, urban agriculture and high-tech applications.