Vietnam emerges as magnet for investment by Danish companies
VOV.VN - Danish companies are in the process of increasing their presence in the Vietnamese market amid the nation recently becoming a major technology manufacturing hub.
Most notably, Denmark has emerged as a major investor in the country this year as LEGO Group has committed to investing US$1 billion to build its first factory in Vietnam, with the site also being the company’s first ever carbon neutral factory.
Since the enforcement of the EU-Vietnam Free Trade Agreement (EVFTA) back in August, 2020, the EU-Vietnam trade turnover surged by 14.8% to reach US$63.6 billion last year.
Furthermore, the country is rapidly becoming a crucial hub for the high-end manufacturing industry through the presence of global tech giants such as Apple and Samsung, both of which have recently unveiled plans to expand their operations in the country.
The nation is also in the process of investing significantly in renewable energy with the aim of developing net carbon emissions by 2050.
Troels Jakobsen, head of Commercial section at the Embassy of Denmark in Hanoi, said the country has always been a major investment destination for Danish companies, with both sides celebrating 50 years of diplomatic relations last year.
Nguyen Trinh, senior economist for Emerging Asia at Natixis, assessed that Vietnam has been rapidly playing a key role in the global value chain and has become the world’s latest technology centre.
In particular, the country has also benefited from China's "zero-COVID" policy, with a number of multinational companies moving to relocate their operations from China.
However, analysts agree that the EVFTA’s incentives and renewable energy represent key factors in attracting Danish businesses to invest in the Vietnamese market.
At the recent Vietnam-Denmark Business Forum, Danish State Secretary for Trade and Global Sustainability Lina Hansen said energy remains a key factor for investment in Vietnam.
At present, the nation ranks among the top 10 solar power producers in the world, generating more than 11% of its electricity demand from solar energy.
Along with a coastline which stretches for 3,260 km, Vietnam has also shown great investment potential in the field of wind energy.
Currently, the country has a solar and wind capacity of around 16.6 GW and 0.6 GW, respectively, with the Government planning to boost the overall capacity to 20 GW by 2030.
These factors, coupled with prospects for strong involvement in the global supply chain, have convinced Orsted, a leading corporation in the field of offshore wind power in the world, to show keen interest in investing in the country.
September last year saw Orsted Group and T&T Group officially sign a Memorandum of Understanding (MoU) in order to start strategic co-operation on offshore wind in Vietnam.
This represents part of several offshore wind power projects in Binh Thuan and Ninh Thuan provinces, with a total installed capacity of nearly 10 GW and a total investment value of roughly US$30 billion.
Recently, the company also signed an agreement with a subsidiary of PetroVietnam to co-operate in a number of renewable energy projects.
Along with the rapid integration process, the nation has increasingly becoming a safe and competitive investment destination for investors around the world, especially Danish businesses, according to several economic experts.