Hai Phong creates a strong attraction for Korean and Japanese investors

Hai Phong creates a strong attraction for Korean and Japanese investors

Le Thu – 15/11/2022 08:21

The leading position belongs to Korea

According to the Department of Planning and Investment of Hai phong city, South Korea is currently the leading country in terms of the number of projects and investment capital out of a total of 42 countries and territories investing in Hai Phong. Of the 839 valid foreign investment projects in Hai Phong, with a total investment capital of more than $23.984 billion, 173 projects are from South Korea, with a registered capital of $9.65 billion, accounting for nearly 21% of the total projects.

The mark of Korean investment in Hai Phong is a combination of LG Group’s projects, with 3 investment projects in the top 20 largest Korean projects in Vietnam: LG Display, LG Electronics, LG Innotek, total registered capital of 7.24 billion USD, invested in Trang Due Industrial Park (IZ). This complex has created nearly 25,000 jobs for employees, revenue in 2021 is estimated at 14.5 billion USD, contributing more than 95 million USD to the budget.

At the Conference on Investment and Business Connection between Vietnam – Korea enterprises taking place on August 16 this year, Mr. Nguyen Hoang Long, Director of the Department of Planning and Investment of Haiphong city said that in the coming time, the city will prioritize attracting capable and experienced investors to invest in key economic sectors and industries, projects with high added value, using high technology, environmental friendliness, modern management, energy saving, efficient use of resources, large budget contributions, linkages with domestic enterprises along the value chain… and Korean investors is one of the top choices of the City.

Hai Phong has invested in comprehensive infrastructure development, becoming an important link in the global logistics chain, with Cat Bi international airport, Lach Huyen international deep-water port and direct connection with Ha Noi via the Hanoi – Hai Phong highway. Therefore, we chose Hai Phong as the ideal location to start the first project.

With the development of Hai Phong industry, Korean enterprises can increase their competitiveness by proactively sourcing domestic raw materials, reducing costs, and increasing the localization rate of products. . Thereby spreading, increasing the localization rate of foreign-invested enterprises, helping to increase production capacity and promote the development of domestic enterprises.

Mr. Nam Han Yong, Deputy General Director of LG Display Korea Co., Ltd. assessed: “At present, compared to other provinces and cities in Vietnam, Hai Phong is one of the localities that are actively supporting and having an abundance of well-trained human resources. Therefore, LG Group’s supporting businesses are planning to move here.”

Previously, according to information from the Investment Promotion Conference with Korean businesses in 2022 with the theme “Hai Phong – A successful destination”, there are about 20 Korean investors who are looking to invest in about 2-4 billion USD to Hai Phong.

Japanese capital flows will continue to increase

According to the Ministry of Planning and Investment, from a local perspective, Hai Phong is emerging as an ideal destination for Japanese investors. With the focus on developing models of specialized industrial zones, auxiliary industrial zones, and high-quality ready-built factories, Hai Phong is attracting a lot of attention from Japanese investors.

Among the Japanese FDI projects in Hai Phong, there are two largest projects of Bridgestone and Nipro Pharma Vietnam. In addition, there are many other brands such as Zeon, Nishina, Fuji Xerox…

Tamada Vietnam Company has started to invest in factories and production lines in DEEP C Industrial Park since 2015. This is a 100% Japanese-invested enterprise operating in the field of mechanical engineering.

Mr. Noboru Iwakaji, Director of Tamada Vietnam Company Limited said: “We invested in Hai Phong and have received a lot of support from the Vietnamese Government as well as from the Haiphong city People’s Committee. One of the reasons why Tamada decided to invest here is the strong local economic development and the hard working workers. We hope that, in the near future, Tamada’s 2-layer gasoline tank products will be widely produced and distributed in the Vietnamese market.”

Mr. Le Trung Kien, Head of Hai Phong Economic Zone Authority (HEZA), said that Japanese investors are currently focusing on the fields of processing industry, machine manufacturing, metal products production, medical equipment and instruments, telecommunications and electronic products accessories; Hydraulic equipment for construction machinery and industrial vehicles. Up to now, Hai Phong has attracted 146 investment projects from Japan and Japan is the second largest country in terms of investment capital in Hai Phong with more than 3.24 billion USD.

In order to continue to improve the scale and quality of Japanese capital flows into Hai Phong, according to Professor Kenichi Ohno, a leading Japanese investment consultant, the locality needs to build industrial zones with good infrastructure and workshop available for rent, good living conditions, one-stop service in Japanese, on-site customs declaration procedures and warehouse in the industrial park… A survey by the Japan Chamber of Commerce and Industry shows that there are up to 70% of enterprises said they want to invest in specialized industrial zones for Japanese investors. In fact, Japanese investors in Hai Phong are also focusing mainly on Nomura Industrial Park and some other IPs such as DEEP C, VSIP Hai Phong.

Stemming from the demand for group investment of Japanese investors, Kajima Corporation recently implemented the Core5 Hai Phong Project at DEEP C 2 Hai Phong Industrial Park. It is expected that at the beginning of the second quarter of 2023, the first factory and warehouse of Core5 Hai Phong project will be ready to hand over to customers.

According to the Ministry of Planning and Investment, the quality of capital (with high technology content)  as well as the investment structure of Japan (86% focused on manufacturing and processing industries) are very suitable with the orientation of FDI attraction of Vietnam; have far-reaching effects on the economy.

It is no coincidence that countries in the region (typically Thailand) have been looking for ways to best meet the requirements of Japanese investors to pull this capital flow. This is also one of the reasons that Hai Phong is very interested, focusing on attracting capital flows from Japan.

One of the signs that capital flows from Japan into Hai Phong will continue to increase is the presence of Japanese investors in the real estate and commercial sectors here. These projects, in addition to serving the needs of the domestic market, also serve the accommodation and shopping needs of the Japanese themselves when they come to Hai Phong to work on their projects. Among them, Nikko Hai Phong Hotel can be mentioned by Chuo Vietnam Co., Ltd. as an investor; The Minato luxury apartment building is invested by Fujitar of Daiwwa House Group and is also the general contractor AEON Mall.

At the beginning of 2022, Nikkei Asia reported, a joint venture between two major Japanese power companies will participate in the construction of one of the largest natural gas-fired power plants in Southeast Asia in Hai Phong. with a maximum capacity of 4.5 GW – the leading large capacity in Southeast Asia. The plant is expected to start operating with a scale of 2 GW in 2026.

Ready to welcome investors

Hai Phong has outstanding advantages in traffic with all 5 types of traffic and has the largest deep-water port in the North. In which, there is a direct flight to Incheon International Airport (Korea); There are many airlines operating routes from Hai Phong to 5 cities in Japan (Osaka, Tokyo, Nagoya, Fukuoka, Sapporo), very convenient for trade. Besides, the city currently has 14 industrial zones in operation. The period from now to 2025 will focus on developing and expanding 15 more industrial zones with a total area of ​​6,148 ha. According to the plan, in the fourth quarter of 2022, Trang Due 3 Industrial Park will be officially put into operation.

“This will be a favorable condition for Korean and Japanese businesses to come to learn and invest in Hai Phong,” emphasized Mr. Le Trung Kien.

In order to improve the production and business efficiency of Korean and Japanese investors as well as other FDI enterprises, Hai Phong is continuing to focus on improving the investment environment; develop infrastructure, especially transport infrastructure projects with regional connectivity, to maximize advantages of geographical location, strengths and potentials in the field of logistics. Along with that, focus on speeding up the progress of developing new industrial zones; supporting and developing the circular economy, prioritizing the use of renewable energy according to modern and sustainable trends such as solar energy, wind power…

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