More Korean Businesses Than Ever
The Vietnam Chamber of Commerce and Industry (VCCI) and the Korea Chamber of Commerce and Industry (KCCI) sponsored the 10th joint meeting of the Korea-Vietnam, Vietnam-Korea Economic Cooperation Committees in Hanoi during Republic of Korea (RoK) President Lee Myung Bak's visit to Vietnam from October 20-22. At the meeting, representatives of the Foreign Investment Department of the Vietnamese Ministry of Planning and Investment and Vietnamese businesspeople said that the quality of RoK businesses' investment in Vietnam is quite high.
Vietnam Oil and Gas Group (PetroVietnam) Deputy General Director Do Van Hau said that immediately after Vietnam-RoK diplomatic relations were established in 1992, PetroVietnam and RoK businesses (the Korean National Oil Company (KNOC), LG, Deasung, Deawoo, Samhwan, Hyundai and Seoul City Gas) signed a cooperative agreement to extract natural gas from Lot 11-2 off the coast of Vietnam. These RoK contractors and PetroVietnam have worked well together to realize contract provisions, including additional provisions to extract natural gas from the Rong Doi and Rong Doi Tay fields. The companies have thus far invested US$769 million and extracted 3.8 million tonnes of condensate and 3.28 billion cubic meters of natural gas.
The SK Company (RoK) contributed 25 percent of capital invested in the oil and gas product distribution contract involving Vietnam's offshore Lot 15-1/05. It is also working with PetroVietnam at Madagascar oil and gas project locations.
In Vietnam, Korean companies have been involved in refining, liquefying and trading in oil and natural gas and they have also offered design and construction services. This includes a large amount of equipment and materials used to build and operate the Dung Quat oil refinery. They also helped build the pipeline that's transmitting gas from the Bach Ho field to the mainland, the Dinh Co gas handling plant and the Phu My nitrogenous fertilizer plant. Hyundai is the EPC (engineering, procurement and construction) contractor for the Dung Quat Polypropylene Project and the PVTex project in Dinh Vu, Hai Phong. Other Korean companies have expressed an interest taking part in power plant design and construction in Vietnam.
Hau said that Korean companies' investment in the Vietnamese oil and gas industry is substantial and significant and Korean businesses are highly competitive. They also understand the Vietnamese market. Korean businesses follow Vietnamese law, abide by contacts, are experienced in implementing international projects, are financially strong and technically highly capable.
The deputy head of Vietnam's Foreign Investment Department, Nguyen Xuan Trung, said that the Vietnamese Government appreciates RoK investment in Vietnam. At the end of September 2009 there were 2,284 RoK projects with a total of US$22.4 billion in registered capital, making RoK first and second among 88 countries and territories investing in Vietnam in terms of project number and registered investment capital, respectively.
Trung said that besides the oil and gas projects, Korean businesses are involved in telecommunications, real estate, auto manufacturing, shipbuilding, hotel/restaurants, urban area development, infrastructure construction and retail sales in Vietnam. RoK investment has helped create more than 350,000 jobs in the country. World famous Korean brands like Hyundai, Deawoo, LG, Samsung, Kumho Asiana, GS and Lotteria are all present in Vietnam and very familiar to Vietnamese consumers.
Korea-Vietnam Economic Committee President Kim Jae Yong said that most Korean companies in Vietnam say that they expect to increase their investment within the next year or two.
VCCI President Vu Tien Loc said that most Korean investment in Vietnam was in low-tech industry but it is shifting to fields that have been prioritized by the Vietnamese Government such as hi-tech industry, services, infrastructure, IT (information technology) and environmental protection. Increased Korean investment in these fields, encouraged by the governments of both the RoK and Vietnam, could upgrade the Vietnam-RoK relationship to one of a strategic partner relationship.
Vietnamese and Korean businesses will make decisions which best suit their own development strategies but at the same time the governments of the two countries welcome suggestions that will result in policy improvement and increased bilateral cooperation./.
(Copy VEN) |
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