A mobilephone component factory of Samsung in Bac Ninh province (Photo: VNA)Park Chul Ho, General Director of the Korean Trade-Investment Promotion Agency (KOTRA)’s Hanoi office, made the remark during a recent interview with the Thoi bao Kinh te Viet Nam (Vietnam Economic Times).
He said Korean businesses’ interest in Vietnam is stronger than ever, noting that Vietnam with open policies has maintained good economic growth. The Vietnam-RoK Free Trade Agreement, effective from December 2015, has also boosted bilateral trade.
Since the deal took effect, the RoK’s imports from Vietnam rose by 27 percent within a year and enjoyed the same growth rate in the first two months of 2017 compared to a year earlier.
Trade surged 90 times from USD500 billion in 1992 to USD45.1 billion in 2016, turning the RoK into the third biggest trade partner of the Southeast Asian nation last year.
At a recent meeting between Vietnamese Prime Minister Nguyen Xuan Phuc and RoK Foreign Minister Yun Byung-se, the two sides aimed for bilateral trade to hit up to USD100 billion by 2020. KOTRA will step up investment and trade promotion activities to realise the target, Park said.
As RoK investors considered Vietnam an important manufacturing centre, they focused investment in the manufacturing industry. However, they have been shifting to more sectors such as goods distribution and education.
This is a positive development as it can create opportunities for Korean firms to partner with Vietnamese peers in multiple fields, according to the KOTRA Hanoi chief.
RoK companies have invested in 19 areas in Vietnam, mostly processing and manufacturing (USD35 billion), real estate (USD8.2 billion), and construction (USD2.7 billion).
Despite a decline in recent years, manufacturing still makes up the biggest proportion of Korean investment in Vietnam. It is forecast to retain this position as many RoK factories are being moved to Vietnam due to the degradation of China’s investment climate.
Manufacturing-related services are set to develop in the near future, Park Chul Ho said.
Distribution, wholesaling, retailing, science-technology and infrastructure are also expected to attract stronger investment.
Park hopes that with such changes, the two countries’ enterprises will develop new industries and make inroads into global markets by cooperating in more diverse sectors./.