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Vietnam sees a surge in foreign investments

The garment and textile industry in Vietnam has seen good investments from several foreign firms recently. Countries are taking advantage of opportunities created due to free trade agreements such as the Trans-Pacific Partnership (TPP) and VN-EU Free Trade Agreement and rapidly investing in Vietnam.

As per Nakajima Satoshi, Japanese Consul General to HCMC many Japanese firms have started investing in the garment and textile industry. A recent survey reveals, 60 per cent of the 500 Japanese business firms were looking at vesting in Vietnam. The garment and textile field also attracted businesses from South Korea, China, Hong Kong (China) and Taiwan (China).

Many delegations of foreign firms had learned about Vietnam’s investment environment, according to HCMC Enterprise Association. Many wanted to build garment and textile plants about 50 km from the centre of the city. Satoshis, explained why investors chose HCMC neighbouring regions. He says field surveys by Japanese trade promotion agencies in Vietnam showed it was easier for them to find land species with area of 20 hectares or larger each. Besides, rent and labour cost were low and don’t go up quickly.

Moreover foreign firms are investing in Vietnamese garment and textile industry because local businesses have vacated. Thought the country has over 2,000 companies operating in this space, most are involved in export orders. Also, the materials they use come from countries without incentives for free trade.

Vietnamese garment and textile products exported to the US and European nations would enjoy zero per cent tax rates instead of 10-30 per cent at present once the TPP and VN-EU FTA are signed.

 
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