China has been considered a place where world leading technology investors chose to set up production factories due to cheap labor costs and abundant resources. However, recently with the changes of power supply in plant operation, it has affected the operation of technology enterprises, supply chain and product productivity. Therefore, many technology enterprises have planned to leave China to find other countries, including Vietnam to set up company.
Moving a factory out of China to set up a factory in another country is a big and extremely complicated decision for investors. However, the reason why foreign investors are reluctant to continue production in China is because the widespread power outage has directly affected the production activities of enterprises. Especially in the current time, every business wishes to increase the amount of goods produced to serve the large consumption demand of customers in the first period of the new year. However, the power outage has taken place since the middle of 2021 and is happening more and more often, affecting the normal operation of technology businesses.
In addition, foreign investors began to realize that they were not appreciated and treated fairly. Because while the production activities of international enterprises must depend on the schedule of power outages, domestic enterprises are still provided with electricity for production. Moreover, many investors also believe that their manufacturing activities do not bring much value to China, nor are they valued and facilitated for development.
In the long term, this will disrupt supply chains in manufacturing operations. Because the power outage not only causes delays in the delivery of orders, reduces output product productivity, but also affects the price, reputation and quality of goods of enterprises. This is also an issue of instability that investors fear will get worse. Currently, technology investors are planning to move out of China, in which, Vietnam is a country with enough factors to become a suitable destination. Vietnam is implementing priority policies, technology development, along with policies to support, exempt and reduce taxes for science and technology enterprises. These policies, regardless of domestic or international enterprises, are the first conditions to help Vietnam become a worthy investment destination today. In addition, Vietnam has a young, abundant, and appropriately trained workforce that meets the business and development conditions of technology enterprises in the world. In addition, the cost of renting space in Vietnam is relatively low compared to other countries in the region, and its geographical location near China will make it convenient for businesses to move out of China.
In the coming time, with policies to attract and develop investment in science and technology, Vietnam will be an investment destination for international technology enterprises to establish business.
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