Rare earths, semiconductors can contribute 5-10% to Vietnam’s GDP: association chair
Rare earths and semiconductors may contribute 5-10% to Vietnam’s GDP once the country can tap its critical mineral reserves and develop the industry, said Prof. Nguyen Mai, chairman of Vietnam's Association of Foreign Invested Enterprises (VAFIE).
Mai revealed his calculations at the Vietnam Industrial Park Forum 2023: Towards Green Growth, held by The Investor on Thursday.
Vietnam produced 4,500 tons of rare earths, critical minerals for semiconductor production, in 2022, and plans to exploit around 220,000 tons per year in the future.
This potential output will help to restructure the global rare earth market and attract investors from the U.S, EU, South Korea, and Japan. Rare earths and tungsten can also give Vietnam leverage with those partners, the veteran expert added.
He said that dozens of foreign firms have expressed interest in mining rare earths in Vietnam.
“Vietnam’s economy has never faced such a tough time as in 2023, but we have rare earths and tungsten to help us out. Currently, dozens of investors have lined up and met with the Ministry of Planning and Investment, guaranteeing Vietnam’s Prime Minister that rare earth exploitation will be increased," Mai noted.
Today, Vietnam’s two most important competitors for FDI are India and Indonesia. As a result, if Vietnam does not recognize this major obstacle and capitalize on it now and in the future, particularly given EU and U.S. chances, Vietnam will be unable to overcome it.
Mai commented that one of the major challenges for foreign firms entering the country is that Vietnam does not meet their standards, particularly in terms of intellectual property rights, petty corruption, and onerous investment procedures.
All of these challenges are intertwined with national administrative reform. “In the future, we will look for more synchronized and successful reform,” he added.
Expect more U.S. investors in Vietnam
Nguyen Cong Ai, deputy general manager of KPMG, said at the event that the increase of registered FDI in Vietnam by 7.7% in the first nine months year-on-year is an impressive figure given that Vietnam's economy is undergoing the most challenging period in its history. It is projected that FDI capital flows will expand considerably in the final three months of the year. In 2023, investors from North Asia (particularly Japan, South Korea, and China) will make up the majority.
“We also expect U.S. investors to participate more following President Joe Biden's visit to Hanoi in September,” Ai noted.
KPMG surveyed 200 FDI firms to determine what makes them decide to pour money into the country. The main factor is the locations of industrial parks (roads near airports), followed by human resources. Electricity and water infrastructure come next. A power outage of one hour per day, seven days a week, or a lack of electricity, like in the past, has a significant impact on foreign investors' confidence.
In terms of industries, KPMG believes that FDI capital will be heavily concentrated in manufacturing and processing, banking and finance, wholesale, retail, and real estate.
According to KPMG, there will be a shift in FDI capital flows between northern localities. Bac Ninh province is renowned having the highest rate of industrial development, however, FDI capital flows are shifting to neighboring Bac Giang province.
- Read More
Samsung Electro-Mechanics to build new factory in Vietnam
Samsung Electro-Mechanics (SEM), the semiconductor and camera module arm of South Korea chaebol Samsung, is set to build a new factory in Vietnam.
Industries - Fri, May 3, 2024 | 10:19 am GMT+7
Stock market liquidity forecast to pick up at end-Q2
Real estate investment cash flow remains limited, but money flowing into stocks is likely to be positive at the end of the second quarter, said Dinh The Hien, director of the Institute of Informatics Research & Applied Economics.
Finance - Fri, May 3, 2024 | 10:14 am GMT+7
Ca Mau company director faces legal proceedings for illegal invoice trading
Police in the southernmost province of Ca Mau have launched legal proceedings against Dang Quoc Viet, who established three companies to illegally trade 350 invoices for VND130 billion ($5.12 million).
Society - Fri, May 3, 2024 | 9:00 am GMT+7
IMF makes new recommendations for Indonesia’s economy
The International Monetary Fund (IMF) has given some comments on Indonesia’s economy as the country is undergoing a government transition from President Joko Widodo to President-elect Prabowo Subianto.
Southeast Asia - Fri, May 3, 2024 | 8:40 am GMT+7
Indonesia aims at three-fold increase in EV sales this year
The Indonesian government has set a target for the sales of battery-based electric cars to reach 50,000 units in 2024.
Southeast Asia - Fri, May 3, 2024 | 8:36 am GMT+7
Thailand's economy grows 1% in first quarter
The Bank of Thailand estimates that the country grew by just 1% in the first quarter on both a quarterly and annualised basis, reported the Bangkok Post.
Southeast Asia - Fri, May 3, 2024 | 8:35 am GMT+7
Thailand aims for 5% growth in future food exports
Thailand is targeting future food export growth of 2-5% this year, driven by the global economic recovery and sustainability trends.
Southeast Asia - Fri, May 3, 2024 | 8:34 am GMT+7
Malaysia asserts pioneering role in halal industry
Malaysia should harness the collective expertise and resources to drive sustainable growth and development of the halal industry, according to Minister of Investment, Trade and Industry Zafrul Abdul Aziz.
Southeast Asia - Fri, May 3, 2024 | 8:33 am GMT+7
Indonesia, Malaysia step up defence cooperation
Indonesian Defence Minister Prabowo Subianto and his Malaysian counterpart, Mohamed Khaled Nordin, discussed opportunities for stronger defence cooperation between the two countries at their meeting on Wednesday in Jakarta.
Southeast Asia - Fri, May 3, 2024 | 8:08 am GMT+7
HCMC needs 50,000 apartments per year to meet demand: Savills
Ho Chi Minh City will need about 50,000 new apartments each year to meet demand, with 60-70% in the affordable segment, but current supply is falling way short, according to Savills Vietnam.
Real Estate - Fri, May 3, 2024 | 8:00 am GMT+7
Vietnamese retail majors set for prosperous year after robust Q1
Vietnamese retail majors have reported Q1/2024 profits several times higher year-on-year or turned losses into profit after purchasing power recovered significantly during Tet (Lunar New Year) holiday, market observers say.
Companies - Thu, May 2, 2024 | 10:21 pm GMT+7
Vietnam assigns vice chairman to take charge of parliament
National Assembly standing Vice Chairman Tran Thanh Man has been tasked with running the national parliament after Chairman Vuong Dinh Hue was dismissed from his position.
Politics - Thu, May 2, 2024 | 7:37 pm GMT+7
Vietnam investment environment favorable for strategic M&A opportunities: KPMG
With inflation under control, projected growth of 5.8% and public debt kept manageable this year, Vietnam’s investment environment offers strategic opportunities, especially in M&A, says audit and consulting firm KPMG.
Economy - Thu, May 2, 2024 | 4:59 pm GMT+7
PV Gas sees Q1 net profit go down 26% to $99 mln
PV Gas, Vietnam’s largest dry gas and LPG supplier, earned consolidated net profits of VND2,511.66 billion ($98.96 million) in Q1/2024, down 26.5% year-on-year.
Companies - Thu, May 2, 2024 | 3:38 pm GMT+7
Key infrastructure projects face site clearance issues, material shortages
Progress of the Long Thanh international airport project and component projects for the North-South Expressway’s eastern section in the 2021-2025 period is being held back by uneven site clearance and material shortages.
Infrastructure - Thu, May 2, 2024 | 3:35 pm GMT+7
Ba Ria-Vung Tau province health department head in trouble for bidding rules violations
Legal proceedings have been initiated against Pham Minh An, director of Ba Ria-Vung Tau province's Department of Health for alleged bidding regulation violations related to equipment supply for a hospital.
Society - Thu, May 2, 2024 | 3:21 pm GMT+7