EuroCham opening eyes of investors
EuroCham opening eyes of investors
Ahead of the upcoming enforcement of the landmark EU-Vietnam Free Trade Agreement, European enterprises in Vietnam are seeking to venture further into the most appealing fields in order to bet on their growth potential.
A group of more than 20 business members of the European Chamber of Commerce in Vietnam (EuroCham) and Vietnamese partners arrived in the northern port city of Haiphong at Damen Song Cam Shipyard last week to begin the FDI Excursion Tour of the EuroCham.
Visitors were taken aback by sight of green and fresh space at the shipyard. Just outside the city centre, the yard is located on a 43-hectare plot of land alongside the Cam River, where a number of shiplifts are docked to wait for tests, or delivery to customers worldwide.
Officially opened just over five years ago, Damen Song Cam is a joint venture between Dutch-based Damen Shipyards Group (70 per cent) and Vietnamese partner Song Cam shipyard (30 per cent). It is able to deliver up to 40 workboats a year, with all of the products being for export.
“The facilities at Damen Song Cam have been designed to maximise quality and efficiency. The shipyard has plans for future investments to double capacity from the current 40 deliveries a year to 80,” said Joris Van Tienen, general director of Damen Song Cam.
The other famous EU-based brand in Haiphong is Deep C Industry Zones (IZs), which boasts shareholders in the Belgian government, the Haiphong People’s Committee, and Rent-A-Port. Established in 1997, the 541ha Deep C I has, next to the Dinh Vu Port system, attracted over 70 projects, while the 645ha Deep C II, which opened a year ago, is also now attracting much interest among investors.
To meet the growing demand among investors, Deep C III is being developed across 523ha, of which 385ha is land available for lease and the remainder as the port area.
“The project is located adjacent to Lach Huyen Deep Seaport,” said Bruno Jaspaert, general director of Deep C Industrial Zones. “We plan for a general cargo berth serving tenants of Deep C IZs, and the dedicated area for the logistics complex is 37ha in , while the dedicated supplier park is for the automotive industry.”
As planned, Deep C III will be offered for lease by the end of 2019.
Haiphong is currently one of the most attractive destinations among EuroCham members in Vietnam, with Damen Song Cam and Deep C being among the successful names there.
Despite growth potential, total EU investment in Haiphong remains lower than expected, reaching $350.30 million by 2018, making up just 2 per cent of the city’s total foreign direct investment (FDI). The Netherlands took the lead among EU investors in the city, followed by Germany, France, the UK, Belgium, and Norway.
In addition to Haiphong, other fast-growing areas of the country besides Hanoi and Ho Chi Minh City – such as Ba Ria-Vung Tau, Long An, Binh Duong, and Dong Nai – are also on the FDI Excursion Tour’s list of destinations, reflecting the investment trend and strong interest among European businesses in the country. These localities are appealing to EuroCham members as they are the biggest magnets to FDI in Vietnam, and which are attracting powerful international groups.
Over the last few years EuroCham, which has over 1,000 members in Vietnam, has been organising regular tours and excursions both to promote these member companies, and to showcase the opportunities of investing in these areas.
For instance, the tours in the northern region have brought a number of visitors to EuroCham member companies such as Deep C Industrial Zones, logistics provider DB Schenker, garment producer Van Laack, and Damen Song Cam shipyard.
In the south, EuroCham also organised industrial excursions to showcase the huge improvements in Vietnam’s logistics infrastructure and in modern IZs. Ports involved have included Tan Cang Hiep Phuoc, Tan Cang Cai Mep-Thi Vai, and industrial parks like Long Hau, Hiep Phuoc, and Phu My 3.
“These excursions have been very successful, and we hope to continue organising more in the future to highlight the advantages of investing in Vietnam as it continues to improve both its infrastructure and business environment,” said EuroCham chairman Nicolas Audier. “In making these improvements, Vietnam is becoming ever more integrated into global supply chains and, in the process, becoming an increasingly attractive trade and investment destination for European companies.”
Today, the EU is the fifth-largest foreign investor in Vietnam with almost $24 billion invested in over 2,000 projects in the country. Indeed, European investors are present in 52 out of 63 cities and provinces, with the majority of investment being in manufacturing ($8.4 billion), electricity ($5 billion), and real estate ($2.6 billion). Last year, Europeans invested over $1 billion in Vietnam
“This will grow even further once the EU-Vietnam Free Trade Agreement and Investment Protection Agreement are ratified and enter into force, following the official signing in Hanoi last month,” Audier said.
