[Webinar] Manufacturing Shift from China – Are Vietnam’s Industrial Parks and Logistics Attractive Enough?

On September 29, EuroCham hosted a special webinar on “Manufacturing shift from China (continued..) Are Vietnam’s Industrial Parks and Logistics Attractive Enough?” with guest speakers Mr. Paul Tonkes, Director of Industrial and Logistic Services, Cushman & Wakefield and Ms. Shirakawa  Satoko, Director, International Business Advisory. 
With the second webinar about the topic of manufacturing shift from China, EuroCham was honoured to receive the support of Ns Bluescope Lysaght – The Australian Steel Solution Expert and Kizuna Vietnam.
        
Understanding the importance of the topic towards EuroCham members, EuroCham decided to organize a second webinar on this subject with more focus on industrial and logistics industries. The webinar was moderated by Mr. Sérgio Pereira Da Silva, Board Member of EuroCham and Chairman of CCIPV Vietnam, and was attended by more than 100 members from businesses, NGOs, and representatives of business associations.
      
Mr. Paul Tonkes, Director of Industrial and Logistic Services, Cushman & Wakefield opened the session with a discussion about Vietnam’s FDI market overview 2020. According to Mr. Tonkes, the total FDI of Vietnam in the first 9 months of 2020 is USD 21.1 billion – an increase of 18.9% YoY with 1,947 new projects approved which covers more than USD 10.36 billion. In Q2 of 2020 alone, Vietnam’s index of industrial production recorded a modest increase of 0.74% year-on-year, much lower than the growth of 9.2 % in Q2 2019 and 5.3% in 2020, due to strict COVID-19 social distancing policy in April 2020.
     
   
Mr. Tonkes also discussed Vietnam’s Industrial Market Overview, 1H 2020. Vietnam currently has 336 industrial parks with 261 IPs having come into operation and 75 IPs being under construction and site clearance. He also gave details about the market by regions in Vietnam.
In his presentation, Mr. Tonkes also stressed the rise of ASEAN and the pros and cons of industrial real estate in Vietnam. The global spread of COVID-19 has sparked a clarion call to diversity, with supply chains moving away from China. SEA, therefore, presents a viable alternative for manufacturers. Turning to the logistics real estate market in Vietnam, he also gave a deep analysis on the supply and demand together with a “SWOT” analysis of the market.
    
Ms. Shirakawa Satoko – Director of International Business Advisory – continued the presentation by giving an introduction to Kizuna Vietnam and some of the difficulties of attracting FDI that Vietnam is currently facing.
According to Ms. Shirakawa, Vietnam is one of few countries that achieved positive growth during the COVID-19 pandemic with economic growth expecting to slow sharply in 2020 to 4.8%. Vietnam’s garment and textile industry was most affected with exports down 15% YoY.
Besides the advantages that Vietnam has, it still faces many difficulties and problems such as language barriers, culture differences, law, financial difficulties and risk for investment. Ms. Satoko also analyzed a case study of a European firm investing in Vietnam with the pros and cons that they are facing.
   
    
At the end of the webinar, Ms. Satoko also provided a solution for quick, easy and efficient production in Vietnam through rental serviced factories. A rental serviced factory will support to save initial investment cost, time and reduce investment risk.
    
    
Later, in the Q&A session, participants discussed issues including whether North and South Vietnam would be more attractive to investors and many other questions relating to the importance topic.
   
    
Concluding the webinar, EuroCham board member Sérgio Pereira Da Silva thanked our speakers and all participants for joining the discussion.
He also thanked Ns Bluescope Lysaght – The Australian Steel Solution Expert and Kizuna Vietnam for supporting EuroCham in organizing the webinar. 
EuroCham will continue to keep our members updated on new developments in the business environment of Vietnam, so remember to follow us on social media and sign-up for our newsletter.