According to experts, compared to other ASEAN member countries, Vietnam is assessed to own a number of unique advantages, which help the country gain special attention from Hong Kong businesses.
HSBC is one of Hong Kong’s businesses in Vietnam
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Besides, Nicholas Kwan, research director of the Hong Kong Trade Development Council, said that Vietnam owns two other potential areas that will attract more Hong Kong business in the future.
The first reason is that Vietnam still owns cheap human resources and abundant raw material sources, which are more competitive than other regional countries. This factor has been so far also reinforced by improved quality and efficiency.
Secondly, Kwan said, Hong Kong investors also see high potential from Vietnam’s increasing purchasing power thanks to its growing middle class with increasing income.
Hong Kong companies, which are outsourcing for US famous brands, want to target Vietnamese customers for their high quality products at cheaper prices, compared with American products, he said.
Win-win cooperation
According to Region Paul Chan Mo-po, financial secretary of the Hong Kong Special Administrative, Vietnam - with its rapid infrastructure, economic and technological development - has clear growth orientations and attracted attention from Hong Kong.
Hong Kong is China’s key gateway to the world and vice versa, while Vietnam is among economies with the most impressive growth in Asia, he said.
The partnership between Hong Kong and Vietnam will play a key role in shaping Asia’s development into a strategic centre in many fields, he stressed, adding that the ASEAN-Hong Kong free trade agreement is considered a boost to investment, trade and service flows between the two sides in the coming time.
To capitalize on chances offered by both sides’ potential, Chairman of the Hong Kong Trade Development Council Vincent H.S. Lo suggested Vietnamese firms actively attract financial sources from Hong Kong to develop domestic infrastructure and industry, while using trade transaction floors in Hong Kong to promote its goods to global buyers.
He said Hong Kong firms need to quickly set up partnerships with their Vietnamese enterprises to seize investment and business opportunities in the market and expand their reach to other markets in ASEAN.
Lo noted the two economies still have large room to boost investment in the fields where Hong Kong holds strengths and Vietnam have demand such as supporting industry, finance – banking, and logistics.
Sharing his investment experience in Vietnam, John Cheh from the Hong Kong-based Esquel Group said foreign businesses operating in Vietnam should not only focus on cheap labor for export processing, but also pay attention to creating core values and contributing to the country’s socio-economic development.
Cheh said Hong Kong enterprises should work with Vietnamese partners to produce goods and develop the market, and advised them to pay their local workers properly in exchange for their long-term commitments.
Hong Kong is Vietnam’s sixth biggest foreign investor. By the end of August 2018, Hong Kong has a total of 1,353 projects worth US$19 billion in Vietnam, mainly focusing on the fields of production, logistics, food processing, hotel and travel.
