Vietnam should be Samsung’s biggest global strategic hub: PM
Samsung’s success reflects a strong relation between South Korea and Vietnam.
Prime Minister Nguyen Xuan Phuc suggested that Samsung should expand operation in Vietnam and turn the country from its biggest global production hub into a strategic one.
Prime Minister Nguyen Xuan Phuc and Vice Chairman of Samsung Group Lee Jae Yong. Source: VGP.
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According to Phuc, Samsung’s success reflects a strong relation between South Korea and Vietnam.
In the coming time, Samsung should expand investment in fields of semiconductor, infrastructure, finance and information technology, Phuc added.
The PM expected Samsung to speed up construction of the R&D center in Hanoi, which is part of the plan to promote research and development in Vietnam. The PM also urged the Korean giant to continue to assist Vietnam in expanding its supporting industries and create conditions for local businesses to join Samsung’s supply chain.
Phuc also asked Samsung to assist Vietnam in developing e-government, for which the tech giant has already had experience in similar project in South Korea.
At the meeting, Lee Jae Yong said Samsung is committed for long-term investment and expansion in Vietnam. Lee stressed that Samsung shares with Vietnam’s desire to develop the country’s supporting industries and increase the localization rate.
In addition to promote R&D activities in Vietnam, Samsung has been working with local companies in supplying parts and providing human resources, Lee continued.
Currently, around 200 tier-1 vendors are joining Samsung's supply chain in Vietnam, including 29 Vietnamese companies.
The number of Vietnamese suppliers is expected to rise to 50 by 2020. To make it happen, Samsung has been supporting local firms in acquiring expertise from South Korean experts and improving their capacities.
Samsung's four subsidiaries in Vietnam posted revenue of a combined VND405 trillion (US$20.5 billion) and a profit of VND41.1 trillion (US$2.08 billion) in the first quarter this year, both increasing 50% year-on-year, according to the companies's quarterly financial statements.
Among those four, Samsung Display Vietnam (SDV) witnessed the highest growth rate in terms of revenue. Compared to the same period of last year, the company's revenue increased by 50% and its profit rose seven-fold.
The other three companies are Samsung Electronics Vietnam Bac Ninh (SEV), Samsung Electronics Vietnam Thai Nguyen (SEVT) and Samsung Electronics Ho Chi Minh (SEHC).
Overall, Samsung produced 1.05 billion products from 2009 to June 2018, of which, Samsung Electronics Vietnam Bac Ninh (SEV) and Samsung Electronics Vietnam Thai Nguyen (SEVT) produced 625.74 million and 431.68 million products, respectively.
According to Samsung's statistics, around 50% of Samsung's smartphones and tablets are produced in Vietnam and exported to 128 countries and territories, including the US, Europe, Russia and Southeast Asia.
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Vietnam news in brief - August 24
Read The Hanoi Times to stay up to date on developments in Vietnam.
- Growing number of FDI firms moving to Vietnam
- Vietnam Gov’t committed to facilitating Adani Group’s US$2-billion port project
- Vietnam Railway proposes US$87 million for Hanoi–Dong Dang railway upgrade
- Vietnam’s North-South high-speed railway to be designed for 350km/h
- Vietnamese gov’t urged to address impact of global minimum tax
- Samsung plans drastic investment increase in Vietnam over next three years