Vietnam is considered an attractive destination among major companies shifting some or entire production lines out of China amid pandemic-induced disruptions.
More and more Chinese consumer electronics manufacturers like Luxshare Precision Industry, Goertek and Pegatron have recently set up new factories in Vietnam, according to consultant Henrik Bork of Asia Waypoint.
In its article in early June, Nikkei Asia wrote that for the first time ever Apple is moving some iPad production out of China and shifting it to Vietnam.
Germany's news site DW reported that companies, especially those operating in the electronics industry, are investing more in Vietnam. In February, South Korea's leading electronics group Samsung announced it would invest an additional $920 million in the Southeast Asian country.
Global companies like Apple are reportedly moving production to Vietnam mainly due to high wages in China and intense U.S.-China trade competition. The administration of U.S. President Joe Biden is looking to diversify the global supply chain, and Vietnam is considered to have an important role in this policy.
In addition, Vietnam currently has a young labor force and a competitive manufacturing industry, and also boasts a sea route conducive to exports, which has prompted a slew of EU and Asian free trade agreements.
DW quoted Daniel Muller, manager of German Asia-Pacific Business Association, as saying: "It currently looks as if, in particular, medium-sized companies are increasingly striving to enter the Vietnam market."
Vietnam has become a more attractive destination for investors, Raphael Mok, head of Asia Country Risk at Fitch Solutions, told DW.
Global tech giant Samsung has so far invested a total of more than $20 billion into the Southeast Asia country, 28 times higher than its initial commitment. The Korean group's facilities currently include six factories in Ho Chi Minh City in the south and the northern provinces of Bac Ninh and Thai Nguyen, one R&D center in Hanoi, and one sales subsidiary.
To date, American giant chipmaker Intel has poured $1.5 billion into Vietnam, making it the largest U.S. high-tech investor in the country. Intel is preparing for further expansions with new investments.