Vietnam is becoming a favored destination for solar photovoltaics (PV) manufacturers, driven by the low costs of manufacturing in Vietnam combined with rising global demand and US tariffs of up to 165% on crystalline silicon PV solar imports from China and Taiwan to prevent dumping.
In early March 2019, TTI Group from the US expressed interest in developing a solar panel manufacturing plant and an R&D center in Saigon Hi-Tech Park (SHTP) in Ho Chi Minh City (HCMC) with an investment of USD 150 million. First Solar, one of the US biggest solar manufacturers, is also set to return to Vietnam five years after leaving the country. It is moving forward on its plans for the initial factory, and has committed to a second factory in Dong Nam Industrial Park in Ho Chi Minh City. The two factories are expected to produce 2.4 gigawatts (GW) worth of First Solar’s Series 6 modules annually after becoming fully operational. The company is also looking into module supply agreements to support local projects.
Meanwhile, in the North of Vietnam, Chinese and Taiwanese companies are main investors. Bac Giang has eight projects which will form the largest solar energy equipment manufacturing chain in Vietnam, with a total capacity of 5,200 megawatts (MW) per year. One of those plants is being constructed by JA Solar with capital of investment up to USD 280 million. Some well-known Chinese manufacturers such as Trina Solar, JA Solar, and Bowerway Group have been shifting production to Vietnam for a while now. In 2019 Trina Solar announced a new 258 MW project located in Ninh Thuan, the central province of Vietnam. This is one of the largest solar power projects with investment capital of 220 million USD from Vietnam’s Trung Nam Group.
(Source: Vietnam Net)
The Ministry of Finance in Vietnam has sent in a ministry document (655/BTC-CST) to the prime minister requesting a change in laws to remove the special consumption tax on locally made auto parts and components. The move could cut prices on cars assembled locally.
As per the current law, the automaker’s selling price defines the calculation of the special consumption tax on cars. Cars with nine seats or fewer assembled locally are subject to a tax rate ranging from 35 – 150%.The elimination of such a tax would imply adjustments to the Law on Special Consumption Tax.
The proposal aims to increase the localization rate, lower product prices and enhance the competitiveness of local manufacturers against international ones. It proposes a special consumption tax for locally assembled cars with nine seats or less based on the automaker’s selling price, minus the value of locally manufactured parts. The proposed changes come at a time where competition between importers and local automakers is intensifying, especially with the deduction from 30 % to 0% of the import tax for automobiles from ASEAN countries.
The special consumption tax may conflict with the World Trade Organisation’s General Agreement on Tariffs and Trade which bans making distinctions between imported and domestically produced goods. Nonetheless, other countries in South-East Asia, such as Thailand have already come forward with regulations that favor locally assembled cars.
The Ministry of Industry and Trade had an ambitious localization target of 60% by 2010 for cars with nine seats or less, but until now the average rate has been around the 7-10% mark. With the approval of this proposal, the government might be able to stimulate the localization rate for locally manufactured auto parts, boosting the domestic industry.
(Source: Vietnam News)
The Japanese group, Marubeni, has started the construction of paperboard mill plant in the North of Ba Ria Vung Tau Province in January, 2019. The project which is worth VND 4.81 trillion (USD 206 million) comprises a total area of 15ha in Phu My 3 Industrial Zone (IZ). The designed capacity is said to be at 400,000 tonnes annually. Commercial production will commence in the second half of 2020
The head of authority in the province hopes the new mill will make effective contributions to fostering provincial socio-economic development and create more jobs for local people and local enterprises. Ba Ria Vung Tau has attracted 351 foreign-invested projects with total registered capital of USD 27.18 billion. Japan ranked fifth among 27 nations with 31 projects, valued at USD 2.25 billion. Furthermore the production will also aid the business of packaging paper, which is forcast to grow at the rate of 15% over the next 10 years.
(Source: Vietnam News)
Coca-Cola, the most popular soft drink brand in Vietnam, has recently announced plans to build their fourth factory at a budget of USD 300 million. The company is currently looking for a suitable location in Hanoi for the construction of the said factory.
The new facility will reportedly produce both traditional Coca-Cola beverages such as Coca-Cola, Fanta and Schweppes, and more nutritious products such as Fuze Tea.The project is expected to generate jobs for thousands of direct and indirect labourers and developing a network of distribution.
Media reports also claimed that the company would seek to build a further production facility in Ho Chi Minh City in the future.
According to Vietnam Economic Times, beverages have been one of the key drivers of growth in Vietnam's fast-moving consumer goods (FMCG) sector, as driven by an expanding middle class, increasing affluence, and changes in consumer lifestyles and preferences. In particular, the country’s non-alcoholic drink (soft drink) industry has seen significant growth over recent years and attracted major investment as evidenced by the presence of hundreds of domestic and foreign soft drink manufacturers. According to Vietnam Trade Promotion Agency (VIETRADE), with the advantage of natural resources like abundant mineral water, various fruits, the soft drink market has a large-scale, high rate of growth and has gradually met the domestic demand, while eyeing for export markets at the same time. Between 2009 and 2013, Vietnam’s bottled soft drink industry grew at a rate of 19.4%, and is projected to maintain a 14.2% growth rate from 2014 to 2018.
(Sources: VietnamPlus, Vietnam News Agency (VNA), Vietnam Economic Times, Vietnam Trade Promotion Agency (VIETRADE), FoodBev Media Ltd.)
In the recent years, many companies that operate manufacturing plants in China have begun shifting or increasing production elsewhere due to rising labour, land rental and environmental protection costs in the country. However, tariff hikes from the ongoing US-China trade war has accelerated this trend with countries such as Vietnam, increasingly becoming an important part of these companies' supply chain.
Recently, A-share listed companies have announced their entry plans in Vietnam in succession, including Great Star Industrial, one of the largest hand tool manufacturers in Asia. The company announced they will invest USD 30 million to put up a factory and global distribution base in Vietnam's northern port, Hai Phong. More than 60% of the company's export sales go to the US, and the current trade tiff between the two world's largest economies are causing serious concerns for their business.
Another Chinese company, Zhejiang Hailide New Material Co., Ltd., has also announced building a USD 155 million factory in Vietnam. The company plans to speed up the project's 3-year construction with the first phase - the building of a differential polyester industrial filament that will have an annual output of 110,000 tonnes, to break ground before 2018 ends. Currently, the company sends majority of its finished products such as industrial yarns and printing materials to the US and other countries.
Meanwhile, global footwear brands like Adidas and Nike have expressed their plans of expanding their output in Vietnam. Vietnam already took up almost half of Adidas' production in 2017, while China, which used to be their biggest production hub, only contributed almost 20%. This gap is expected to widen as the company estimates Vietnam will produce more than half of Adidas footwear by the end of next year. Similarly, Nike has also increased production in Vietnam as the country now makes almost half of their total footwear exports.
More of these companies that manufacture footwear, textiles, industrial products and electronics are expected to start or scale up their production in Vietnam as the the global supply chain undergoes major changes. According to Standard Chartered Bank's recently published Global Research report entitled “Vietnam – Fast, not furious, growth”, Vietnam is likely to remain the fastest-growing ASEAN economy in 2018 and 2019, as in 2017. They remain positive on Vietnam’s medium term growth due to strong manufacturing activity which is growing double digit. The Bank maintains its views that FDI inflows will stay strong in 2018 until 2020, with registered capital of close to USD 17 billion each year, and FDI inflows to the manufacturing sector, particularly electronics manufacturing, will remain high.
(Sources: Viet Nam News, Xinhua Silk Road Information Service, INQUIRER.net, Standard Chartered Bank)
Global chemicals manufacturer, Huntsman Corporation, has announced a plan for a new multi-purpose facility near Ho Chi Minh City, Vietnam. The site, located at the Amata Vietnam Industrial Park, is a greenfield investment, and it will host Huntsman's Polyurethanes and Advanced Materials businesses, including manufacturing; research and development capabilities. The compound will also have a technical service center; warehouse and distribution space and a commercial office.
President of Huntsman's Advanced Materials business added: "This is the first manufacturing expansion investment outside China for our business in Asia Pacific and we see many opportunities in Vietnam to support large-scale infrastructure and construction projects in one of the fastest growing economies in the region.The new plant is said to give the capability to efficiently supply customers across the ASEAN region with high quality electrical insulation, coatings and adhesive solutions.
In addition to this facility, Huntsman has a distribution warehouse located in the inland container depot at Long Binh - Dong Nai Province, and a site in Hanoi which offers technical service and comprises warehouse and distribution space and a commercial office.
The largest dairy producer in Vietnam, Vinamilk, has just announced their plan to develop a 6,000-ha complex of hi-tech dairy farms in the Mekong Delta area. Vinamilk partnered with another local firm, Song Hau Farm Corporation for the project, which will have a total investment of VND 4 trillion (USD 171.3 million). This project will include the third organic dairy farm which is capable of breeding up to 22,000 cows and a processing factory. A part of the investment will be poured into the improvement of Vinamilk's current processing plant and distribution center in Can Tho city, which was built 18 years ago.
This new complex is expected to have a huge impact on the dairy and meat industry and animal feed industry as automated technologies and advanced management systems will be applied for the whole complex. The project will also attract satelite farms to complete the supply chain and provide thousands of jobs for local people.
Sources: VietnamNews, Voice of Vietnam
Vietnamese conglomerate, Vingroup JSC, has entered into a strategic partnership agreement with Spanish company, BQ to venture into smartphone manufacturing, through the brand "VSmart".
Vingroup focuses on real estate development and operates1 ,000 retail stores across Vietnam, while BQ is a Spanish consumer electronics company that designs and manufactures multimedia devices, including smartphones, tablets, e-readers etc., 3D printers and educational robotics kits.
Under the agreement, Vinsmart will purchase intellectual property rights from BQ to develop two smart phones under the brand name Vsmart, in the high-end and mid-range segment. At the same time, VinSmart will exploit BQ's strengths in almost all aspects of the value chain of producing smartphones from design, research and product development to production. VinSmart will also cooperate closely with BQ in the process of product research and development in the areas of smart electronics, artificial intelligence (AI), automation and new generation materials.
In June 2018, Vingroup announced the launch of VinSmart Joint Stock Company with a charter capital of VND 3 trillion (USD 131 million).
The production plant for "Vsmart" will be built in accordance with international standards at the VinFast automobile and electric motorbike manufacturing complex in Dinh Vu - Cat Hai industrial park in the northern port city of Hai Phong.
Currently, Samsung holds over 40% market share of Vietnam's smartphone market, followed by Chinese brand, Oppo, with around 22% market share.
A new policy by the Vietnam government in the form of Decree No.116/2017/ND-CP passed earlier this year has introduced many strict conditions and regulations about importing cars. According to the Vietnamese government, the decree aims to boost the development of the country’s automobile manufacturing industry and enhance the standards of imported cars across a variety of metrics.The new regulations impose requirements for the manufacturers to have Vehicle Type Aproval (VTA) certification issued by authorities in the exporting countries. In addition, one or two cars in each imported batch will be randomly inspected by relevant authorities. Air emission levels, quality and engine security will be checked.
Consequently, several vehicle manufacturers appear to be focusing on exapnding production in Vietnam at the cost of production in neighbouring countries such as Indonesia.
Toyota Vietnam has submitted a proposal to the the Vinh Phuc People’s Committee to rent 9.1ha of land in Phuc Yen city to expand its automobile manufacturing plant, raising its annual capacity from the current 50,000 to 90,000 units by 2023, with a capital investment of aorund USD 40 million.
Earlier, Huyndai annouced their second plant in Vietnam in the northern province of Ninh Binh to. Ford VN also revealed the posibility to accelerate the assembly in Vietnam to qualify for 0% incentive for components. Mitsubishi Motors expects their second factory in Vietnam to start production mid 2018.
(Sources: Vietnamnet, Tuoitre)
The government of HCMC is enacting a series of policies in order to aid businesses in the sector including encouragment of investment, networking between firms and banks, and creation special zones.
Supporting industries are those that produce materials, parts and components, accessories and intermediate products for supply to manufacturing/ assembling industries producing final goods as means of production or consumer goods.
The HCM City Export Processing and Industrial Zones Authority (HEPZA) is working with authorities to form specific zones of a total area up to 300 hectares for supporting industries in major industrial and processing zones in the city. Additionally, HCMC Department of Industry and Trade (DOIT) is working with the central bank, the State Bank of Vietnam, to connect financial institutions, including banks, and credit unions with businesses in the supporting industry. Many costs such as appraisal, counselling and certification for businesses will be shouldered by the State Budget.
HCMC also offers financial support for businesses to hold exhibitions or conferences to attract investment or for joining delegation to events in other countries.
Currently, supporting industries for automobile and electronics sectors are receiving the most interest and investment in the millions of dollars. The authorities are striving to meet the target of 45% input demand for manufacturers by 2020 and 65% by 2025.
(Sources: Vietnam News, Online Newspaper of the Gorvernment)
The world's leading company in specialty chemical supplies for building and motor vehicles, Sika AG, has poured additional funds into its plant in the northern Vietnam, aiming to grow its busienss further in the booming construction market. With additional funds, the new modern facility for mortar production will be applied to the existing production, allowing the company's portfolio of locally manufactured products to have a more competitive cost structure.
“The new mortar facility in Bac Ninh is a targeted investment in the expansion of our production capacity around the Hanoi metropolitan region. It enables us to deliver significantly faster growth in northern Vietnam and optimize our cost structure, with the elimination of long transport distances. Our customers benefit from an enhanced, high-performance portfolio of products that is aligned with building standards, as well as from shorter lead times.” - said Mike Campion, Regional Manager Asia/Pacific.
The need for ready-mixed mortar in Vietnam, which is one of Sika's strongest product lines, is increasing as a result of the more stringent regulatory requirements in construction sector. It helps the company to gain more market share in the massive construction sector, where rising education and prosperity levels fuel demand for high-quality, high-performance building materials.
With the growth of infrastructure, expanding tourism, as well as strong growth rates of industrialisation and urbanisation, Vietnam's construction sector is expected to grow by 9.6% this year, and post a healthy 7.2% average in the period of 2018-2026.
Online home furnishings brand from Los Angeles, Abbyson, has expanded its global operational footprint by opening a new Vietnam office, which will oversee all its current and future factories in Vietnam. The office enables Abbyson to have local representation for its global supply chain and manufacturing capabilities.
Abbyson's Vietnam factories produce a capacity of 400 containers per month, along with more than 5,000 outbound shipments each month. It has a wide product range, which includes bedroom, case goods, dining, entertainment, occasional and upholstery products. Abbyson has design teams in both its U.S. offices as well as in Vietnam.
Now that the company has established local staff in Vietnam, it will strategically further its quality control initiatives to increase efficiency in terms of quality, delivery and overall factory accountability on all Abbyson products. It will also use its local presence to optimize relationship management with current and future suppliers.
(Source: Casually Living)
South Korea's leading textile and chemicals firm Hyosung Group is gearing up to invest USD 6 billion to enable Vietnam become a global manufacturing base for the chemicals and heavy industries in 2018. Hyosung is planning to convert its Yongyeon propylene plant, whose capacity was increased by 300,000 tons last year, into a plant for producing PP for pipes, a high-value-added product, and dualize the new propylene plant in Vietnam by producing general products as well in an effort to secure cost competitiveness and profitability, and maximize synergy effects.
As for motors, Hyosung is planning to make half-finished products in cost-competitive Vietnam, bring them to the Changwon plant in Korea, make finished products, and export them so that the productivity of domestic plants will be enhanced and exports will be increased as well.
Since Hyosung established Hyosung Vietnam in the Nhon Trach industrial complex near Ho Chi Minh City in 2007, the company has invested about USD 1.5 billion so far. Hyosung is the largest investor among the Korean companies in the Nhon Trach industrial complex.
(Source: Hyosung Group)
The demand for elevators and escalators has been consistently increasing in Vietnam as a result of the rapid growth of its urban population and the expansion of its urban centers. The country's market for elevators has grown by 30% in recent years, offering opportunities to foreign exporters, as the country is still import-reliant for this product.
To leverage this opportunity, one of the largest manufacturer of electric motors in Japan, the Nidec Group, has recently entered into a cooperation agreement with Vietnam's largest elevator and escalator manufacturer, Alpec Joint Venture Company in which both companies will supply elevators in Vietnam. Nidec will also send foreign experts to assist Alpec in quality assurance, labor safety, as well as research and development of elevator equipment.
Furthermore, Nidec has announced plans to invest approximately USD 500 million in Vietnam as part of its efforts to respond to the increasing demand for energy-efficient, high-performance brushless motors and other motors used in high-tech devices such as robots.
(Sources: Vietnam Investment Review; Bao Cong Thuong)
USG Boral, a global leader in building products technology, announced its plans to expand production in Vietnam, with a USD 20 million investment in a plant at Hiep Phuoc Industrial Zone, Ho Chi Minh City. The production capacity for plasterboard is currently at 30 million square metres. The new facility is set to increase production capacity by 17 million square metres and is targeted to reach a total capacity of 47 million square metres once it commences operations in September 2019. The company is seeing demand for building materials rise rapidly in Vietnam’s expanding construction industry. The addition of this new capacity will allow it to meet the growing demand for high-quality plasterboards.
USG Boral was the first global corporation to establish a plasterboard production facility in Vietnam, commencing operations in 2006. Since then USG Boral has been a leader in the industry, supplying products to many of the major developments throughout the country. Their flagship products include SHEETROCK®, FireBloc, Durock® and Fiberock® have been adopted by contractors, home owners and architects.
(Source: USG Boral)
Yamato Sewing Machine Manufacturing Company, a leading Japanese manufacturer of industrial sewing machines, has decided to establish a sewing machine factory in Da Nang Hi-Tech Park. Yamato, which has had a liaison office in Ho Chi Minh City since 2007, will invest USD 28 million for the 2.85 hectares of land that it will occupy to build a factory for its sewing machine, spare parts, and accessories manufacturing business.
Two other Japanese companies - Hotel Mikazuki, and Katsuura Hotels - have invested in the city, according to the Da Nang city’s investment promotion agency. The two companies deal with hotel, recreation and resort business and have a combined total investment of USD 110 million for the 24.5 hectares of land in the Lien Chieu District, where a beach resort and hotel will be built by 2018.
The three Japanese companies have contributed hugely to placing Japan as the second largest investor in Da Nang, making its projects part of the 134 projects worth USD 598 million in the city alone.
(Sources: Vietnam Construction; BizHub)
Olmix Asialand Vietnam, an affiliate of France-based Olmix Group, inaugurated an animal feed additives plant with an annual capacity of 5,000 tonnes in Song Than 2 industrial park in the southern province of Binh Duong, Vietnam. The plant, which is Olmix's first in Asia, has been built with a total capital investment of EUR 2 million. In the first stage, it will produce 5,000 tonnes of feed additives, equivalent to 15,000 tonnes of animal feed to serve Vietnamese and Asian markets. During the second stage, it will raise the total capacity to around 5 million tonnes of feed additives. The company aims to grow the firm into one of the top three vet medicine and feed additives suppliers in Vietnam.
Olmix specialises in manufacturing feed additives and vet vaccines using natural algae-based technology. Over the past 22 years, it has spread operations globally and offered solutions for nutrition, hygiene and health of plants, animals and humans to more than 100 countries worldwide
(Sources: Voice of Vietnam; Olmix Group)
According to Reuters, Vietnam’s leading property developer Vingroup has launched construction of a car factory. The company, which has expanded into other major sectors such as retail and healthcare, is now looking to move into the heavy industries sector, and is investing between USD 1 - 1.5 billion into the first phase of the project. It aims to become a top car manufacturer in the South East Asian region, making 500,000 cars per year by 2025. In the first phase, it will produce 100,000-200,000 vehicles per year, including 5-seat sedans, 7-seat SUV and electric motorbikes. Vingroup also plans to introduce the first electric motorbikes in 12 months and first cars in 24 months. Funded by a loan of USD 800 million from Credit Suisse AG, it will build a 335-hectare (827.8 acres) factory, located in Vietnam’s northern city of Haiphong.
The province of Tra Vinh in Vietnam is planning to ramp up its food processing sector and is looking for private investors to contribute to their target capital of VND 710 billion (USD 31.5 million). The projects are expected to benefit the locals, employing roughly over 5,000 people and to raise the industrial production value of the province by 2020 to VND 40 trillion (USD 1.78 billion).
The province is looking to mobilize private investment for the establishment of factories for seafood processing, peanut processing, cattle and poultry slaughterhouses as well as vegetable and food processing facilities. It also plans to tap onto funding by the provincial government to build and expand processing plants to raise the production capacity for fruit, vegetables and meat processing.
(Source: Viet Nam News)
Mediplast, one of the leading medical equipment manufacturers in Vietnam has inaugurated a new production plant in Bac Ninh province. This company specializes in manufacturing and trading medical equipment, materials and medical instruments, and related products using modern production lines of UK and Japan.
The new factory focuses on the production of sterile plastic syringes and feeding syringes, K1 auto-disable syringes, Insulin syringes, scalp vein set needles and infusion sets. The total investment of the project is more than VND 61.8 billion (USD 2.7 million) with an area of more than 13,700 square meters. The general director of Mediplast said that investment in a new large-scale factory with synchronous production line would mark a new milestone in the development of Mediplast.
This is a new direction for Mediplast, which clearly demonstrates the orientation of the company after Vietnam Medical Equipment Corporation's (VINAMED) acquisition of Mediplast was approved in May 2017.
(Source: Vietnam News)
As a testament to the fact that Vietnam has become South East Asia's fastest growing manufacturing hub, is the recent announcement of global snack powerhouse Mondelez International’s plans of investing in a world class cake-making facility in Hung Yen Province, Vietnam. The facility will produce various cake brands for the South East Asian market and is aimed to make Vietnam a key manufacturing country in Asia-Pacific for the company. The facility is aligned with the company’s global quality standards and the production line and assigned workforce have been fully equipped to achieve Halal “A” certificate by the Indonesian Council of Ulama (MUI). The production line has followed “GMP - Good manufacturing practices” in design, a leading benchmark in global snacking production and world class quality compliance. The investment is expected to enhance Mondelez Kinh Do’s local competitiveness and export capability, particularly to those markets requiring Halal food standards. Products from this facility will also be distributed to Vietnamese consumers from next year. In 2015, Mondelez International acquired leading Vietnamese food company Kinh Do, which has proven to be a game changer for Mondelez in Vietnam as it generated an annual revenue of more than USD 200 million.
(Sources: Hanoi Times, Vietnam News)
According to Vietnam’s Association of Motorcycle, Vietnam produces 2.8 - 3.3 million motorcycles annually. It is a fertile country for motorcycle production with spare part manufacturing plants. An electric vehicle production complex will be established in Hanoi. This will be a turning point for the electric vehicle industry in Vietnam as electric vehicle production is rather new. In addition, it will also make way for Vietnam as green energy country. The project is invested by N&G Investment & Development JSC and the MBI JSC from the Republic of Korea. The production facility will cover 33,600 square meters with a total investment of USD 1 Billion.
(Sources: The Voice of Vietnam, Vietnam Breaking News)
Vietnam’s Nutifood Food Joint Stock Company, a manufacturer of nutritional dairy food products enters into the coffee market. It acquires 25% of Phuoc An Coffee Co, a state-run coffee enterprise and has plans to increase its stake further to 51% in future. With a total investment of VND 1 trillion (USD 44 million), it plans to establish a coffee processing plant in Dak Lak province and build its own Dak Lak brand coffee with the use of high-tech agriculture technology. The products will be sold domestically and export to U.S. and Japan. According to the Chairman of Nutifood, Vietnam’s coffee production contribution is only 20% of the global market share and only 2% of of the export value. Nutrifood is hoping t to utilize “its distribution network to bring Vietnamese coffee to international markets”.
(Sources: Vietnam Economic Times, The Saigon Times, International Comunicaffee)
In March, the Nikkei Vietam Manufacturing Purchasing Managers' Index, also known as PMI, recorded a 22-month high of 54.6 from 54.2 in February. A figure above 50 indicates expansion and in contrast, a figure less than 50 shows contraction. According to IHS Markit, there was a rise in demand and new orders that caused an increase in production. The rate of growth in new export orders accelerated and was the fastest in 2017 so far.
In addition, employment growth was at six-month high, while March recorded the fastest increase in input costs since May 2011.
(Sources: RTT News, Nikkei Asian Review)
U.S. Dimora has signed a Memorandum of Understanding with Thnanh Hoa Provincial government in setting up an electric vehicles manufacturing facility. The facility will be able to produce 30,000 electric cars per year for the Vietnam market and future expansion into ASEAN region. Phase one of the project is to provide electric car taxis to local Mi Linh Group. The total investment ranges from USD 350 million to USD 500 million. Founder of Dimora hopes that with their electric cars would make a positive impact on the environment.
The authorities feel that the Vietnamese automotive market is lucrative for foreign investors and they welcome foreign investments in electric automobile production.
(Sources: The Saigon Times, Vietnam Investment Review)
Japanese medical manufacturer Nipro Pharma Corporation has been granted an investment certificate to start a USD 300 million project to build a 96,000 square meters dialysis equipment manufacturing plant in Vietnam, Saigon, Hi-Tech Park. Nipro has invested USD 150 million on its first plant in northern Vietnam. The products manufactured will include catheters, blood tubing and other products for dialysis for exports to Japan and Southeast Asia. These products are currently being provided through a subsidiary of Nipro in Thailand.
Nipro is the second production of dialysis equipment in the global market for dialysis equipment used for diabetic patients. Nipro’s expansion to Vietnam is to increase its manufacturing capacity and Vietnam’s low cost in labor further enhanced their decision in opening up the plant in Vietnam. Nipro has further plans to invest in another USD 110 million in expanding it production capacity at the plant by 2025.
(Sources: The Saigon Times, Vietnam Investment Review)
According to Nikkei Manufacturing Purchasing Managers’ Index (PMI) in December 2016, an indicator of the economic performance of the manufacturing sector, Vietnam ranks second in ASEAN. Philippines tops the other ASEAN countries while Thailand came third, followed by Myanmar, Indonesia, Malaysia and Singapore. Vietnam’s Manufacturing PMI shows an increase from November to December. The increase is contributed by new orders, output and employment. In general however, the ASEAN manufacturing in 2016 is weaker.
The Nikkei Manufacturing PMI is a data compilation form 400 industrial companies monthly questionnaires and responses from their purchasing executive. The sector is divided to the following categories: basic metals, chemicals and plastics, electrical and optical, food and drink, mechanical engineering, textiles and clothing, timber and paper, and transport.
(Sources: Hanoi Times, Vietnam Net Bridge)
Tata Coffee Ltd plans to set up a freeze dried coffee plant of 5000 metric tonne per annum (MTPA) capacity in Vietnam with an estimated investment of USD 50 million. The move is expected to further strengthen Tata Coffee's growth in the premium instant coffee segment.
Tata Coffee already has freeze dried coffee manufacturing plant in Theni (Tamil Nadu), which develops blends customized to varied consumer preferences. Freeze dried coffee is a growing segment worldwide in the premium instant coffee segment. Instant coffee accounts for about 20% of the global coffee consumption with freeze dried being the most premium. The plant in Vietnam will serve global customers of Tata Coffee with new product mixes of freeze dried coffee. According to the company, Vietnam offers an attractive business environment besides being the largest robusta coffee growing region. The plant will help it further expand its global footprint.
(Sources: Tata Coffee, The Saigon Times, International Communicafe)
Japanese packaging company Rengo Co., Ltd. has announced the successful start of the second paper production line with Vina Kraft Paper Co., Ltd., at its joint venture containerboard mill in Vietnam.
Vietnam is a fast growing country in ASEAN, with 2016 GDP growth estimated at 6.1% by the IMF World Economic Review. Demand for containerboard is expanding at the same pace. With this new capacity as well as optimization of the first paper production line, Vina Kraft Paper adds 243,500 tons per annum to its portfolio, bringing the total capacity to 489,000 tons.
The new facility features an environmentally friendly self-sufficient co-generation power plant, a raw material preparation line, and a high-standard effluent treatment plant.
Vina Kraft Paper will maintain its leading position in Vietnam’s containerboard market and aim for sustainable growth in the country with high quality products.
(Sources: Rengo, Pap News, The Packaging Portal)
Johnson Hardwood Floors, a leading manufacturer of premium hardwood flooring with distribution to the United States and Canada, has announced the start-up of its new 80,000-square-foot, multi-million dollar plant in Ho Chi Minh City. The plant was built brand new from the ground up, with state-of-the-art manufacturing and finish line equipment. The ultra-modern facility includes production lines for core assembly, milling/profiling, hand scraping, traditional and alternative finishes and automated climate control technology.
One of the standout features of the new hardwood flooring plant is a finishing line spanning 150 meters. Here, specialized workers can—depending on the product line in production—manually applies different stains and finishes on the planks. According to Johnson Hardwood, the daily target production capacity is 300,000 square feetup from an initial 60,000 square feet. More importantly, the new facility is 100% CARB-2 certified, Lacey Act compliant and utilizes only responsibly harvested species.
The company is preparing to break ground on a plywood production facility adjacent to the flooring mill. A larger-scale production shift is also expected further down the road as a result of the new facility coming online.
(Source: Floor Covering News)