Foreign investors target smarter production chain

You arrived in Vietnam to take over a new position in the company. Can you share anything about your plan here?

I have arrived here for one month and I am responsible for expanding the file of customers, which consist of Chinese companies in Vietnam. I would like to study the supply chain in Vietnam as well as the domestic market.

It is the reason why I was participating at the 2024 Vietnam Global Manufacturing Forum, where I had opportunities to meet potential partners to serve our expansion plan in the country.

How do you evaluate the investment environment in Vietnam?

I see that the Vietnamese government determines its investment attraction strategy clearly and it currently also creates better conditions for investors. The government has also successfully made the world understand that Vietnam is a place worth living and investing in.

The government should still take stronger actions to attract investment capital inflow in the smart production direction.

The most crucial thing is to combine stable and plentiful power supply in collaboration with attractive incentives in providing loans and tax reductions.

In addition, policymakers also build a criteria framework relating to power consumption and revenue to get support from the government. Promulgating these requirements should be implemented soon.

It is difficult to change the market’s situation only thanks to purchasing power and the trend of the market. The important factor is the coordination of various governmental agencies.

Vietnam is encouraging investment into smart production. How has Midea and its smart initiatives been performing in Vietnam?

Midea currently has one factory in the southern province of Binh Duong, but it is our first plant overseas. Midea specialises in air treatment, refrigeration, laundry, large kitchen and cooking appliances, smart kitchens, and smart electronic equipment for buildings, in collaboration with providing a smart building management system.

The company established a smart factory in Thailand last year, which offers a high-level view of the current state of smart manufacturing among Midea’s factories. We have plans to popularise this production model to other factories overseas, including Vietnam. These facilities will be applied at the highest automation level.

We are investing in the smart production chain for facilities in Vietnam because of the market’s potential. The company expects to dominate the segment of electronic consumption products in this market. Midea is also expanding production and business activities with some partners. This will support the company on the journey to compete with names such as Daikin and Mitsubishi.

How do you evaluate the position of Vietnam in the regional and glo bal smart production chain and the opportunities to foster this industry?

Vietnam has taken over the shift of many production facilities from China. Thus, the country is still at the basic level.

I believe that similar to China, Vietnam will eventually become a hub for smart production. Vietnam will take less time than China to reach that smart production level thanks to fast growth speed, maybe in the next 5-10 years.

According to the General Statistics Office, Thai Binh currently ranked fifth nationwide in luring foreign investment, with nearly $3 billion seen in 2023.

Foreign investors continue to eye expansion in Vietnam to tap into local potential and strategies.

Singapore was the largest foreign investor in Vietnam in the year to March 20 with over 2.55 billion USD, making up 41.3% of the total foreign direct investment (FDI) registered in the country, according to the Ministry of Planning and Investment’s Foreign Investment Agency (FIA).