Danang To Cooperate With the US Enterprises to Build an IT Center

On Oct 10th, 2019 representatives of Danang city met the US business delegation including Hayward Quartz Technology Inc., Westcoast Precision, Inc., Majestic Beauty Supplies, Inc., Lee’s Sandwiches International, Inc., Hung Phat USA. These are businesses in the field of manufacturing, processing diamonds and gold, silver and gems; production and distribution of beauty accessories, cosmetics; manufacturing and producing metal and hardware, supplying customized high-quality spare parts and semiconductor devices for the medical and biotechnology equipment industry; Manufacturing and distributing semiconductor equipment in the United States, whom shown interest to set up business and expand operation to Vietnam.

epresentatives of US enterprises affirmed that Danang City is a potential destination for businesses in the High Technology and Information Technology. With the coordination, as well as the city’s incentives in the field of high technology and investment in Danang High-Tech Park, enterprises from the United States consider opportunities to invest in the high technology sector in Danang.

Danang city has many benefits that investors are interested in such as the safe and stable living environment, the young and highly qualified labours from more than 25 universities and colleges in the city, in addition the city is also a destination for many domestic and foreign investors in many different fields, which is an opportunity for investors to compete, distribute the productions.

Currently, in Danang, there are more than 60 investment projects of the US investors with the registered capital of nearly 6 million USD, including large projects such as the Sunshine Aerospace Components Plant Project in Danang high-tech park of Universal Alloy Corporation (USA) with total registered capital of USD 170 million; the factory of electronics and electronic equipment manufacturing and assembling project, total capital of USD 50 million, in Hoa Khanh Industry Zone Expansion invested by Key Tronic EMS Group. Besides there are many other projects being implemented and effective in the process of operation.

Danang City and investors from the United States hoped to achieve more business achievements in the future to help investors and the city achieve development goals in the future to welcome company to set up company, factory, and invest in Vietnam.

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FDI into Vietnam Increased Sharply in January 2019

According to the report of the Foreign Investment Agency, the Ministry of Planning and Investment, in January 2019, the total newly registered, increased and contributed capital to buy shares of foreign investors reached 1.9 billion USD, increase by 51.9% over the same period in 2018. It shows that foreign investors are very interested to invest in Vietnam

In particular, foreign direct investment (FDI) from the beginning of the year until January 20th 2019 had 226 new licensing projects with a registered capital of 805 million USD, increase by 36.1% in the number of projects and increase by 81.9% in registered capital compared to the same period in 2018.

Besides, there are 72 licensed projects from previous years registered to adjust investment capital with an additional capital of 340.3 million USD, decrease by 25.5% compared to the same period last year. Thus, the total newly registered and additional registered capital reached more than 1.145 billion USD, increase by 27.3% over the same period in 2018.

In the month, there were 489 turns of capital contribution and shares purchase of foreign investors with a total capital contribution of 761.9 million USD, increase by 114% compared to the same period in 2018; In which, there are 72 turns of capital contribution and share purchase to increase the charter capital of the enterprise with the value of 384.91 million USD and 417 turns of foreign investors buying domestic shares without increasing the capital, valued at 376.97 million USD.

Also in January, the realized FDI capital was estimated at over 1.55 billion USD, increase by 9.2% over the same period in 2018.

Export of foreign investment sector (including crude oil) reached 13.58 billion USD, equaling 94.9% compared to the same period in 2018 and accounting for 67.9% of export turnover. Export excluding crude oil reached 13.4 billion USD, equaling 95% over the same period in 2018 and accounted for 67% of export turnover.

According to the Foreign Investment Agency, FDI capital of new projects in the month focused mainly on processing and manufacturing industries with a registered capital of 591 million USD, accounting for 73.4% of the total new registered capital; Transportation and warehousing industry reached 65.3 million USD, accounting for 8.1%.

Water supply, waste management and handling activities reached 59.2 million USD, accounting for 7.4%; the remaining sectors reached 89.5 million USD, accounting for 11.1%.

From the beginning of 2019, Japan has poured investment capital of nearly 364 million USD, accounting for 19% of the total investment, leading 51 countries and territories with investment projects in Vietnam. The proof is that the Kyoshin Limited Liability Company (Vietnam) granted an amended investment registration certificate dated January 17th 2019 to increase its investment capital by 134.7 million USD.

This is a project invested by Japanese investors in Ho Chi Minh City since 1995 with the goal of manufacturing, processing and exporting electrical components, molds.

Or as Katolec Global Logistics Vietnam project, which was invested by Katolec Corporation (Japan) with a total investment of 65 million USD with the goal of warehousing and storing goods in Ha Nam; Sews-Components Vietnam Factory II project, with a total registered investment capital of 64.89 million USD, invested by Japanese investors in Hung Yen…

Ranked no.2 is Korea with a total registered investment capital of 349.1 million USD, accounting for 18.3% of the total investment capital in Vietnam. China ranked third with total registered investment capital of 307.8 million USD, accounting for 16.1% of total investment capital.

Regarding investment location, foreign investors have invested in 39 provinces and cities, of which, Ho Chi Minh City attracts the most foreign investment with a total registered capital of 745.7 million USD, accounting for 39.1% of total investment capital.

Binh Duong ranked second with total registered capital of 240 million USD, accounting for 12.5% of total investment capital. Hai Duong ranked third with total registered capital of 125.7 million USD, accounting for 6.5% of total investment capital.

In January 2019, there were 4 projects granted certificates of investment registration abroad with total investment capital of Vietnam of 1.05 million USD; in which, there are 2 projects in the field of retail and wholesale with total investment capital of Vietnam is 600 thousand USD, accounting for 47.9% of total investment capital.

The remaining two projects are in the field of professional science, technology, information and communication activities. Countries receiving investment from Vietnam in January 2019 are Singapore, Finland, Japan and the United States.

Also in January 2019, there was 01 project to adjust investment capital with an additional investment of 200,000 USD in Vietnam. In general, in January 2019, the total investment capital of Vietnam to abroad and newly granted increased by 1.25 million USD.

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Japanese Investment Flows into Vietnam Packaging Production

Vietnam Artpresto factory, 100% Japanese capital, specializing in packaging production with a total investment of 5 million USD was started in Chau Son Industrial Zone, Ha Nam province right in the first week after the Lunar New Year holiday.

This event once again shows that packaging is still the field that attracting capital, especially when the major manufacturing industries, from manufacturing and agriculture, are on the rise, leading to the need to use bags.

The Artpresto Vietnam packaging factory, invested by Artpresto Vietnam Company (belonging to Bandai Namco Group), with the goal of producing high quality packaging products.

Once completed, Artpresto Vietnam factory will operate with a capacity of nearly 40 million products/year.

Artpresto Company was established in 1983, in charge of packaging design, product design, and trading printing products of Bandai Namco Group. Artpresto’s total revenue in 2018 is about 8 billion yen.

According to general director of Artpresto Vietnam Company, when operating, the factory in Vietnam will contribute to improving the supply chain of high-quality packaging products for the Japanese and Vietnamese markets.

Not to mention customers, the demand of Bandai Namco Holdings – the parent company of Artpresto is very large, so the factory in Vietnam will be a significant packaging supply channel for the Group. And yet, in the calculation of this group, Artpresto Vietnam will be the first development of Bandai Namco to the Vietnamese market in particular, and the foundation of development in the Southeast Asian market in general.

This can be understood, when doing good business in Vietnam, capital will be poured to expand, increase production and catch up business opportunities.

Earlier, in mid-2018, United Packaging Co., Ltd. was also belong to a Japanese investor – Oji Holdings Corporation, had poured capital to build a factory located in Tan Phu Trung Industrial Park (Cu Chi district, HCMC), on an area of 5 hectares, with a total investment of more than 15 million USD.

United’s factory specializes in manufacturing paper products such as high-end packaging used in the food industry and goods labels.

It is known that Tan Phu Trung Packaging Factory is the 6th project of Oji Holdings Corporation in Vietnam, after projects in Hai Phong and Ha Nam and is the 31st factory of this group in the Southeast Asia region.

With the current growth rate of 10-15% per year, the Vietnamese packaging and processing industry is considered to be quite attractive to suppliers of machinery and equipment operating in the industry, as well as the trend of foreign enterprises expanding investment and acquiring businesses operating in this field.

Packaging is a product rich in types and designs, so packaging materials are also rich and diverse. Packaging materials in Vietnam are mainly plastic, paper, carton, metal and glass. It is estimated that the whole industry will grow by 25% in 2019.

According to the forecast, economic sectors mainly from food, pharmaceuticals and cosmetics will grow 2-digit in the period from now to 2025, so packaging has a good opportunity to develop, including packaging industrial and agricultural packaging. The problem is that business owners need to develop clear strategies, identify core values, strengthen effective management solutions, find appropriate technology equipment…

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Benefits of Setting Up Company in Ho Chi Minh City

Ho Chi Minh City is considered as Vietnam’s economic hub. During the long history of foundation and development, the city’s economy is growing constantly and motivating the development of the country.

The city is therefore considered as a potential investment environment for domestic investors as well as foreign investors. The investment through establishing companies and conducting business activities in Ho Chi Minh city certainly promises to achieve multiple benefits. These benefits come from the following reasons.

First, Ho Chi Minh City has strategic location advantage in Vietnam. Southeast Asia Region, Ho Chi Minh City is 1,700 km south of Hanoi, 297 km east of Phnom Penh, Cambodia, 881 km east of Bangkok, Thailand.

Food, glass, textiles, paper products, plastics, chemicals, building materials and machinery are produced here. Ho Chi Minh City accounts for 20% of total gross domestic product (GDP), 30% of industrial production and 40% of export products of Vietnam. The city also accounts for 33% of the national budget and 60% of foreign investment flows into the region. In the past few years, the economy have been grown at a rate greater than 10% (6% to 8% nationally).

Second, Ho Chi Minh City is home of well – qualified, abundant and young human resources.

With a population of more than 8 million, accounting for more than 10% of the total Vietnamese population, Ho Chi Minh City itself has potential employment market to make any business investment. The work force in Ho Chi Minh City was estimated to reach 4.7 million people in 2012, making up more than 50% of the total population of the city. The percentage of trained labor increased from 40% in 2005 to 55% in 2010 and was forecast to reach 70% in 2015. The percentage of labor source holding postgraduate degree is also increasing year by year and most of them tend to stay in the city after holding degrees. Ho Chi Minh City is also home to more than 80 universities and colleges, vocational schools with over 400,000 students providing an abundant trained work force.

With the above – mentioned abundant labor force, any set up company in Ho Chi Minh City can easily recruit suitable employees in a short time..

Third, the city has modern and high infrastructure system. Namely, when setting up company in Ho Chi Minh City, the owners will benefit from the modern and comprehensive infrastructure system.

Tan Son Nhat Airport is the largest airport in the country with the capacity to accommodate 20 million people a year. From Tan Son Nhat Airport, there are 50 routes to other countries all over the world such as China, Japan, Korea, Singapore, European countries, etc.

Saigon Port serves as a gateway to the Mekong River Delta, the South China Sea (83 km away from the sea) and the Asia continent. The port has a total area of 500,000 m2 with 5 terminals meeting the international standards, and it handles about 8.3 million tons of cargo annually. Throughout the history of foundation and development of Saigon, Saigon Port plays an important role in making Ho Chi Minh City a flourishing trading center. It accounts for a fifth of the nation’s Gross Domestic Product and almost a third of its industrial production.

Ho Chi Minh City is also home to industrial zones. According to the statistics of Cushman & Wakefield, the city has 18 industrial parks that are operating with a total area of 3635 ha. When investing in such industrial zones in Vietnam, enterprises can benefit from various incentive policies such as low rate tax or other incentive policies.

Telecommunication and information technology in the city is modern. The system of post and telecommunication in Ho Chi Minh meets international standard, providing fast, reliable and high quality services such as ADSL, rapid data transfer, wide broadband MAN. The Internet service in Ho Chi Minh city is also among the cheapest in the world.

Besides, the city is also considered the best working conditions. Enterprise will not be fear that it is not enough place for working. The city with the system of offices provide ideal working environment for all investors.

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