Wed, Jul 12, 2006 - Page 11 News List

HSBC says that Vietnam is a great place to invest

MONEY TALKS HSBC says it is in a uniquely favorable position to cater to the needs of Taiwanese customers interested in investing in Vietnam's booming economy

By Amber Chung  /  STAFF REPORTER

Eyeing the nation's robust investment in Vietnam, HSBC Ltd hopes to expand its Vietnam-based Taiwanese customer base by means of its long-standing know-how of the local market and powerful global services network, the bank said yesterday.

With its first foothold in Vietnam established in 1870, HSBC is familiar with the local market and enjoys good relations with the regulator, Huynh Buu-quang, head of commercial banking at HSBC's Ho Chi Minh City branch, told a media briefing in Taipei yesterday.

These advantages coupled with its global network enables the bank to provide more in-depth advice and fuller services to Taiwanese investors interested in Vietnam than other lenders, Huynh said.

At the moment HSBC has two branches and a representative office in Vietnam, a fast-growing Southeast Asian economy and rising foreign investment destination.

The bank serves more than 200 Taiwanese investors there, or a 10 percent share of the market, who are mostly top-tier manufacturers, including Formosa Group (台塑集團) and Pou Chen Corp (寶成工業), the world's largest contract sports shoe maker.

The banking giant, which plans to add an extra 40 percent manpower to its existing seven-member group, hopes to further expand its market share as increasing numbers of Taiwanese companies consider diverting investment from China to Vietnam the bank said. It however declined to give a target figure.

Taiwan used to be the country's largest foreign direct investment source until last year, pouring funds estimated up to US$10 billion from 1998 to last year, according to HSBC's figures.

With an investor-friendly environment Vietnam is becoming a hot foreign investment destination for countries like the US, Japan and South Korea, which in turn squeezes Taiwan's position, the bank said.

The government of Vietnam welcomes high-tech investors in the hope of boosting its status in the global supply chain, said Tony Kuo (郭東霖), manager of Greater China Business at HSBC's Ho Chi Minh City branch.

One of Taiwan's top high-tech firms is interested in investing in Vietnam and has made market investigations, said Kou who declined to elaborate citing confidentiality.

Intel Corp announced earlier this year that it will invest US$600 million in Vietnam.

Vietnam is expected to draw US$6 billion in foreign investment this year, up from US$5.8 billion last year, or double the amount from three years ago. This will be achieved by means of offering preferential tax breaks for three to five years, a cheap work force, an average wage 30 percent less than in China's Dongguan, accession to the WTO by the year's end and less restrictive foreign exchange controls.

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