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More Foreign Investors Keen On Vietnam: UK Financial Times

Vietnam is replacing China as a new alternative for foreign businesses thanks to its lower labour costs and good workers’ skills, the UK’s Financial Times reported on March 14.

The paper cited some instances of UK, American and Danish businesses that operate in the country.

The UK electronic components manufacturer, XP Power, is among many enterprises seeking to diversify production beyond China to capitalize on lower wages and minimize the risks of concentrating in one location.

“Labour costs are cheaper in Vietnam but the workers’ skills are good,” the Financial Times quoted a Vietnamese engineer working for XP Power as saying.

The paper said unskilled workers in Vietnam are generally paid $100-150 per month while the corresponding figure for Chinese counterparts will be about $300.

S. Kesavan, the Vietnam head of the US Jabil Circuit electronics manufacturer, said “productivity in Vietnam is slightly behind China, but the recent escalation of costs in China is making us relocate in order to be competitive”.

Meanwhile, Stig Maasabol, Chief Executive of the Danish-owned ScanCom International, said his company is looking to double its output in Vietnam in the next two years by applying more advanced technology.

Maasabol affirmed that “if Vietnam’s attraction is only wages, companies will soon be looking to Cambodia and Myanmar”, according to the Financial Times. – VOV

Source: Vietnam Business News

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Date: 2012/03/15