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Opportunities and risks of investing in Vietnam in abrasive and abrasive industry

2019-04-10PV:1252

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Vietnam attracted $35.88 billion in foreign investment in 2017, up 44.4 percent year on year and a 10-year high (as of December 20, 2017), according to data released by the Vietnam foreign investment authority.

Among 115 countries and regions with foreign investment sources, Japan overtook South Korea to become the largest investor in Vietnam, with an agreement amount of 9.11 billion us dollars, accounting for 25.4% of the total foreign investment.South Korea took a back seat at $8.49 billion, accounting for 23.7% of total foreign investment.

Notably, China rose to fourth place, with $2.17 billion in deals, 284 new investment projects, 83 catch-up projects and 817 capital injection or share purchase projects.

China overtook Singapore in the number of new projects and Japan in the number of capital injections or share purchases.

In addition, according to data released by the Vietnam foreign investment authority, as of 2016, the total registered capital of Chinese enterprises in Vietnam reached us $10.4 billion, and the investment fields were concentrated in processing and manufacturing, with a total of 916 projects worth us $5.38 billion.

Vietnam certainly has many advantages, such as low Labour costs -- average monthly wages were 5.53 million dong, or about $240, in the first half of this year.In 2017, the average American worker earned $3,099, while the average Chinese worker earned $635.

In addition, Vietnam's industrial electricity consumption is about 0.45 yuan per kilowatt hour, half of that in China.Vietnam has also signed a free trade agreement (EVFTA) with the European Union, and most of the handicrafts and furniture exported from Vietnam to the eu enjoy zero tariffs and so on.

However, the situation is not all optimistic, and there are even many risks and difficulties that are difficult to avoid.

The first is resource and Labour constraints.Vietnam lacks the mature, well-trained labor force it has at home, and the labor intensity, initiative and hours spent on the job are far less than at home, and wages