Vietnam: The Emerging Technology Economy in Southeast Asia
Event date: March 30th, 2006
Vietnam’s technology industry is on the rise! This is due to a rising economy only second to China, socio-political stability, youngest population in the world, government economic reforms, and key developments in the capital markets. On Feb. 28, 2006, Intel Corp. (INTC) Chairman Craig R. Barrett traveled to Vietnam to receive a $605 million investment license from the country’s Deputy Prime Minster to build a new factory in Ho Chi Minh City. The deal is the largest American investment in Vietnam ever by a non-oil company. Intel initially will spend $300 million for a test-and-assembly plant that will be finished next year and eventually employ 1,200 workers. Barrett says Intel chose Vietnam over China, Malaysia, or the Philippines because of the country’s lower costs for skilled workers and its booming economy, which grew 8.5% last year.
Also in February, Canon Inc. (CAJ ) announced it was spending $110 million on an ink jet printer factory near Hanoi. Nidec Corp. of Japan plans to build two plants to make electronic components, at a total cost of $940 million. Fujitsu Ltd. (FJTSY ) has invested $200 million and employs 3,200 people making circuit boards for PCs and phones. Other large players such as Microsoft, Oracle, IBM, and HP have been operating in Vietnam for years.
Recently, internet players such as Yahoo, Google, and Amazon were reported setting up operations. Telco leaders such as Cisco Systems (CSCO ), Nortel Networks (NT ), and Motorola (MOT ) are deploying large telecom projects. (Source: Business Week, March 13, 2006).
In addition, Merrill Lynch recently issues a confident “Buy” report on Vietnam. Please see this article at http://www.vinacapital.com/upload/files/VietnamStrategyFeb06.pdf
