VIETNAM ON THE RISE

In the dynamic landscape of global business, Fifty2Laps has made a strategic decision to extend its operations to Vietnam. This move comes as no surprise, given Vietnam’s emergence as a prime destination for supply chain relocation. Let’s delve into the compelling reasons behind this vision-led step.

1. "China+1 Policy": Diversification Beyond China

The "China+1 Policy" has gained traction among multinational corporations seeking to mitigate risks associated with over-reliance on China. As the world’s factory for decades, China now faces challenges such as rising labour costs, supply chain disruptions, and geopolitical tensions. By diversifying their manufacturing and sourcing activities, companies can safeguard against single-point failures. Vietnam, with its competitive advantages, stands out as an ideal alternative. Its IZs (Industrial Zones) are mainly located around the three major cities (Hanoi, Ho Chi Min City and Da Nang). Many of the manufacturers relocating parts of their production consider Vietnam as a quality source of parts, materials and parts. The government of Vietnam offers incentives such as tax breaks, land grants and access to well-organised utilities and infrastructure.

2. Vietnam’s Strategic Location in ASEAN

Vietnam’s geographical position within the ASEAN (Association of Southeast Asian Nations) region is a key factor. As a gateway to Southeast Asia, it offers unparalleled access to a market of over 650 million consumers. Its proximity to major Asian economies, including China, India, and Japan, makes it an attractive hub for regional trade and distribution.

3. Favourable Business Environment

Vietnam has made significant strides in creating an investor-friendly business environment. The government has implemented reforms to streamline bureaucracy, enhance transparency, and promote foreign investment. Companies benefit from tax incentives, simplified procedures, and robust legal protections. These factors encourage long-term commitment and sustainable growth.

4. Skilled Workforce and Competitive Labour Costs

Vietnam boasts a young and dynamic workforce, skilled in various industries. Labour costs remain competitive compared to China, allowing companies to maintain cost-efficiency without compromising quality. The availability of technical talent, especially in electronics, textiles, and automotive sectors, positions Vietnam as an attractive talent pool.

5. Infrastructure Development

Investments in infrastructure have transformed Vietnam’s logistics capabilities. Modern ports, highways, and industrial parks facilitate seamless movement of goods. The upcoming North-South Expressway and deep-sea ports enhance connectivity, making Vietnam an efficient link in global supply chains. Large MNCs have already established their production footprint in Vietnam (Unilever, Nike, Intel, Samsung Electronics, Jabil, Coca Cola, Bosch, 3M, ABB, Nestle’, only to name but a few). SMEs too are now tapping into this fast developing, efficient supply chain that is growing into large clusters next to the big industry players.

6. Sustainability and Environmental Responsibility

Vietnam prioritizes sustainable development and environmental protection. Companies relocating here can align with responsible practices, minimizing their ecological footprint. This resonates well with consumers and investors who value ethical business conduct.