Global computer chip manufacturer, Intel, has announced that it will be moving more of its mature products to Vietnam due to the Southeast Asian country’s lower labor costs. In this case, the company will be shutting down part of its current operations in Malaysia and moving those jobs to Ho Chi Minh City (HCMC) in Vietnam. China will also receive part of the manufacturing work.
In another strategic move, Intel has partnered with FPT, a Vietnamese conglomerate. Cooperation between the two companies will include implementing a product display and experience area in FPT shops. Intel will also provide training to employees in the shops and participate in marketing activities.
Although Vietnam is more well known for its textile-manufacturing prowess, the country is quickly becoming the go-to location for technology manufacturers. High tech companies are starting to flow into the country as they seek to take advantage of the low-cost, young, fast learning, and rapidly expanding workforce. The country is also providing a range of financial incentives to businesses engaged in high-tech activities, such as large reductions in corporate income tax.
Vietnam is also quickly becoming a prime market for foreign investment in e-commerce activities. The country’s rapidly growing economy and middle class are, in turn, spawning a strong consumer culture and increasing levels of disposable income. Electronic retail is fast becoming the preferred method of shopping—particularly among the country’s youth.
According to Vietnam’s E-commerce and Information Technology Agency (VECITA), in 2015 B2C e-commerce sales in the country will amount to more than US$4 billion. With all of the country’s attractive factors, it is easy to understand why companies like Intel and Samsung are ramping up their investments in Vietnam.