According to the report, the total investment from Singapore-based enterprises in ASEAN market to 2020 is expected to witness a strong increase. In particular, Vietnam is one of the top three regional destinations.
The survey, done by the Singapore Business Federation for HSBC, asked 1036 companies about their interest in overseas expansion. Of the enterprises, 80% are small and medium enterprises, defined as those with an annual turnover of S$100 million (US$73 million) or less than 200 workers.
|Photo for illustration. Source: Internet.
76% said they already have operations in Viet Nam and 30% of them expect to expand their business in the country in the next two years, a rate exceeded only by Indonesia and Malaysia.
Viet Nam’s growing consumer market and overall investment climate are key drivers for future inbound investment, the survey found. It said that 81% of respondents who plan to invest or expand in Viet Nam cited potential customer demand in the country, 75 per cent highlighted overall investment climate and 63 per cent pointed to business costs.
Winfield Wong, country head of wholesale banking, HSBC Viet Nam, said: “Whilst Viet Nam’s growing consumer base is already well recognised by Singapore corporates, the report shows that many businesses are looking to double down on our demographic dividend.
“Beyond the consumer piece, Viet Nam’s manufacturing – whilst already strong - is now entering into the higher-end space. So while many corporates may base their treasury and other back-office functions in Singapore, a lot of revenue-making operations are [carried out in] Viet Nam. This is only expected to ramp up with Viet Nam climbing up the supply and value chain.”
By Linh Bui