Vietnam will continue to remain an attractive market for foreign investment
International media has continuously reported on the great chance Vietnam might stand to replace China as the world's production center.
An Aug. 8 report that "headlines such as ‘Vietnam's exports overtake Shenzhen' and ‘Is Vietnam the next China? have drawn attention in China's media and online forums, reflecting anxiety that Vietnam might usurp China's position as the world's factory."
The report also cited a June study by German newspaper Frankfurter Allgemeine Zeitung with the headline "Goodbye China, Hello Vietnam," in which one manufacturer said: "Vietnam seems to be a better and cheaper China."
Several business owners and executives of foreign enterprises saying that Vietnam was already emerging as a key beneficiary of the China-U.S. trade tensions that began in late 2018, prompting many foreign companies to mitigate supply chain risks by setting up manufacturing operations outside China, including in Vietnam.
Back then, many experts had called Vietnam a "winner" of the trade war as it has received increasing investment as major manufacturers leave China to avoid high tariffs.
According to Vietnam's General Statistics Office, the country's economy grew by 5.03% in the first quarter this year compared with the same period last year, surpassing China, which grew 4.8 percent.
During that period, Vietnam's foreign trade rose to $176.35 billion, a year-on-year rise of 14.4 percent while that of China rose by 10.7 percent.
However, some experts consider China's position as the world's factory as irreplaceable.
In a South China Morning Post report on June 24, Yao Yang, an economist and professor with the National School of Development at Peking University, said: "There's nothing to worry about in terms of manufacturing industries in China offshoring to Southeast Asia, because those that left were low in the value chain."
He added that despite concerns triggered by Vietnam's rising manufacturing capability, China will keep its title as the so-called world's factory for at least 30 years.
An editor with the Global Times said in May that "for the foreseeable future, Vietnam will continue to remain an attractive market for foreign investment and a destination for supply chain diversification, but its ability to bite into China's share of manufacturing is limited."
