After Samsung’s announcement that the company will increase its investment in two plants in Bac Ninh and Thai Nguyen provinces to US$4.5 billion, LG electronics, another major Korean group, has declared a new project worth $1.5 billion in Hai Phong.
Cumulatively, as of the end of August, South Korea has approximately 3,400 investment projects in Vietnam with total registered capital of $25.73 billion, ranking fourth among nations and regions which invest in Vietnam.
LG Electronics (LGE), with total capital worth $1.5 billion, plans to produce household electric appliances, hi-tech electronic products, automobile electronic components and smartphones at the Hai Phong-based Trang Due Industrial Park.
The company aims to build not only a simple plant on an area of more than 402,000 square meters, but also a production complex, said Kim Jong Sik, Co-president at LG Display Co Ltd. “It will add more than 20,000 jobs and allow lots of LGE satellite firms to come to Hai Phong and invest,” Kim asserted.
Meanwhile, Samsung has said it wants to construct a new production plant in Vietnam, including two hi-tech complexes. The first one will be built in Bac Ninh with total capital of $2.5 billion, and the second will be in Thai Nguyen for $2 billion.
Beside $2 billion in initial investments, Samsung also plans to increase its capital to transform the plant into a production complex which will not only assemble and package products, but also produce essential components and accessories.
In late August, Seung Mo Ryu, director of Samsung Electro – Mechanics, during his official visit to Vietnam, submitted documents to request an investment license for the company’s integrated circuit and electronic components manufacturing plant.
In addition to Samsung and LG, other big Korean corporations and companies also want to increase their investment plans in Vietnam. Kumho Asiana will add an extra of $100 million to its Kumho Tires plant in Binh Duong, said Park Sam Koo, president of the company.
Besides topping out a $400 million Lotte Center building in Hanoi, Lotte continues to expand its shopping malls in several provinces. Korea has invested more than $30 billion in Vietnam, ranking second after Japan, which spends more than $33 billion.
Statistics show that thousands of small projects and satellite investors have followed big corporations like Samsung and LG to Vietnam. As of March there were 55 Korean satellite firms with a total registered capital of $2 billion operating in Vietnam, according to a report issued by Samsung Electronics Vietnam.
Last week, Young Sung Precision Vina obtained an investment license for its $400,000 manufacturing plant in Bac Giang. Haesung Vina, another Korean firm, also inaugurated its second plant, which specializes in producing Samsung’s smartphone cameras, at the Vinh Yen-based Khai Quang Industrial Park.
Previously, other small firms including Keosan Vina Electronics, Heasung Teach and Sung Gwang had already invested in the Vietnamese market. “Vietnam is expected to attract investment from Korea, especially in the hi-tech sector,” emphasized Kim Jung In, president of the Korean Business Center.
Besides investing in real estate, finance and the textile industry, Korean investors have begun to expand their businesses to the entertainment and technology sectors.