VN attracts ASEAN medium-sized enterprises
VGP – Thanks to fast growth rates and demographic advantages, the Vietnamese economy has offered a charming environment for ASEAN medium-sized enterprises.
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Open economy
Standard Chartered CEO for Viet Nam,
Viet Nam is a member of 26 FTAs including the CPTPP which has opened abundant opportunities for medium-sized enterprises to select and set footholds in Viet Nam. The local trade environment was forecast to get better when EVFTA takes effect at the end of 2019.
In addition, Viet Nam has demographic advantage including young, well-educated, digital-based population which creates a favorable foundation for effective labor force and promotes demands in real estate and consumption services.
Standard Chartered assessed three potential areas in Viet Nam namely real estate, production, and infrastructure.
Real estate plays as an important economic pillar, surging by 11.7% in 2018 to US$ 191 billion of turnover. The real estate sector brought back numerous potentials for ASEAN medium-sized enterprises and absorbed US$ 3.37 billion of FDI in 2018, accounting for 10.3% of total FDI.
With 11% growth rate of FDI, production sector has become an important one in Viet Nam thanks to advantages in labor forces and Government’s preferences for auxiliary industries. Standard Chartered predicted that the FDI inflow would be maintained highly in medium term.
The Vietnamese Government committed to spending US$ 920 million on infrastructure development by 2020. In addition, renewable energy would become a focus in the next five years.
According to Standard Chartered, ASEAN medium-sized enterprises are enjoying special opportunities to take advantage of the improved economy and demographic factors in Viet Nam.
CEO Nirukt Sapru proposed ASEAN medium-sized enterprises apply appropriate strategies on technological applications to raise productivity and cut costs./.
By Khanh Phuong