US firms show rising interest in Vietnam as global manufacturing hub

The largest-ever U.S. business mission to Vietnam that includes 52 firms is sounding out investment and business opportunities in the booming Southeast Asian country.

Apple, Meta, energy firm AES, Coca-Cola, PepsiCo, Boeing, SpaceX, Netflix, and Lockheed Martin are part of the mission, organized by the U.S.-ASEAN Business Council (USABC) from March 21-23.

Not just a new global production base, Vietnam, with a population of 100 million people, also has a rapidly-growing consumer market as its middle class expands.

Rafael Frankel, Meta’s director for the Asia-Pacific region, said Vietnam is a truly innovative economy with broad internet penetration, impressive growth, and an adaptable and hard-working workforce.

Along with that, the governments of the U.S. and Vietnam have made efforts to promote economic and cooperation ties for Vietnam to lead Southeast Asia in green growth and technology. Therefore, U.S. businesses expect a bright future and want to make more contributions to this process, he said.

Squall Wang, CEO of logistics firm UPS Vietnam, said the express delivery company is aware of Vietnam’s outstanding development in recent years, and wishes to continue to work with policymakers to drive sustainable growth.

In the energy sector, Dang Huong Lan, foreign affairs director of AES Vietnam, said energy continues to be a strategic area of cooperation between the two countries. AES is committed to serving Vietnam’s energy development efforts while leading the energy transition for a cleaner, smarter energy future.

"LNG serves as a transitional fuel for a more sustainable electricity sector in Vietnam. We are working to accelerate our development of the Son My LNG Terminal and the Son My 2 power plant in Binh Thuan province, with a total investment of approximately $3.2 billion. This will immediately play a role in the country’s energy source diversification," Lan said.

"We are introducing the battery energy storage system (BESS) technology to multiply effectiveness in renewable energy investment, solving bottlenecks in transactions and stabilizing the power grid," she added.

U.S. companies are aware of continued expansion in production and global supply chains in Vietnam in semiconducting, FMCG, industries, toys, furniture, food processing, digital and creative economy development, banking and financial services, and healthcare. The aerospace, defense and security sectors have also seen rising interest from both sides.

USABC president and CEO Ted Osius, former U.S. ambassador to Hanoi, told a press briefing on Tuesday that Vietnam is the eighth largest trading partner of the U.S. "American firms are strong in areas like digital and creative economy development, and green energy, meaning more opportunities for bilateral economic cooperation."

The largest-ever U.S. business mission in Vietnam can also be seen as an indicator of an investment wave to Vietnam and ASEAN countries, he said.

Osius added that during the first working day Tuesday, the mission had meetings with different Vietnamese ministries in planning and investment, industry and trade, and finance, and will continue to meet with government leaders. The meetings had good results as ministry officials were ready to answer questions and exchange ideas to solve problems.

"U.S. businesses are paying great attention to cooperation opportunities with Vietnam, an economy that expanded by 8% amid the gloomy global economy.”

Michael Michalak, senior vice president of USABC and the regional CEO, another former U.S. ambassador to Hanoi, said FDI enterprises’ feedback is very positive as they saw the Vietnamese government is in a position for open talks.

Michalak added that after the Covid-19 pandemic, U.S. firms are looking to strengthen supply chain alliances that include members of the Indo-Pacific Economic Framework (IPEF) of which Vietnam is also a member. This is an opportunity that businesses need to pay attention to.

Vietnam’s Minister of Planning and Investment Nguyen Chi Dung had a meeting with the U.S. mission in Hanoi on Tuesday. He said there is huge cooperation potential for the two sides in the fields of green growth, digital economy, science-technology development, and innovation.

Dung said Vietnam encourages and prioritizes quality and focus-driven FDI. The country is also implementing policies to help businesses step up investment in science-technology and improve their production capacity to engage in global supply chains, particularly in the spheres of high technology, innovation, green energy, renewable energy, finance - banking, healthcare, human resource training, infrastructure, and the environment.

The mission includes 3M, Abbott, AES, AIG, Amazon Web Services, Apple, Bay Global Strategies, Bell, Boeing, Citi, Coca-Cola Beverages Vietnam, Energy Capital Vietnam, Fedex, Ford, GSK, J.P. Morgan Chase, KKR, Lockheed Martin, Mariott International, MasterCard, Meta, Mondelez, MSD, MSD Animal Health, Netflix, Organon, PepsiCo, P&G, Roblox, Salesforce, Samtec, SpaceX, Suntory Pesico Vietnam Beverage, Tilleke & Gibbins, UL Solutions, UPS, Viatris, Visa, Vriens & Partner, and VinFast U.S..

The health and life sciences firms on the mission are Abott, Boston Scientific, GE Healthcare, GSK, Illumina, Johnson & Johnson, Medtronic, MSD, Pfizer, Reckitt, Varian Medical Systems, Viatris, Amazon Web Services, and Bay Global Strategies.