Dozens of organisations from Singapore see the potential for their services in Vietnam

This week, Singapore Business Federation will lead a business mission consisting of 28 participants from 25 Singapore organisations in the fields of business and finance services, manufacturing, education, and lifestyle/consumer industries to Hanoi for extensive networking opportunities and amplify regional outreach. Being held for the first time in Vietnam, the event (SRBF) reflects the importance Singapore places on its relationship with Vietnam, with a focus on expanding cooperation to new growth areas such as the digital economy, cybersecurity, clean energy, sustainable development, and smart cities.

Federation chairman Lim Ming Yan said, “The event serves as a catalyst for regional collaboration, unlocking new opportunities, and shaping a sustainable future for businesses in the region. I look forward to the engaging discussions, fruitful partnerships, and meaningful outcomes at this premier networking event.”

Under the theme “Strengthening Regional Collaboration for Sustainable Growth”, the event will bring together industry leaders, government officials, policymakers, academics, and diplomats in the region to foster regional partnerships and explore sustainable business opportunities. It aims to accelerate economic relations and forge closer ties between Singapore and Vietnam.

A number of MoUs, online and offline business matching, and exhibition and industrial visits will be held as part of the event, helping businesses explore avenues for business growth in the region. The SRBF also shows the trend of Singaporean investment in Vietnam which are seeking for new opportunities in high-potential fields. Kho Choon Keng, chairman of the Singapore Chinese Chamber of Commerce and Industry, said, “Developing the food industry, urban infrastructure, modern and environmentally friendly supporting industries, and financial services are the areas that Singaporean businesses are expected to increase investment in. In our group, industrial real estate is also an area we are exploring opportunities to invest here.”

Shanmuga Retnam, executive co-chairman of the Vietnam Smart Cities Consortium, told VIR, “The urbanisation of Vietnam is a step in the right direction to integrate regions and enhance smart urban planning, with the national urbanisation rate set to reach over 50 per cent by 2040. Vietnam is going through a very interesting urban transformation that attracts the attention of the likes of Japan, South Korea, and Singapore.”

Singaporean firms have succeeded in traditional sectors in Vietnam, with more are coming. The process and manufacturing is now the most attractive sector among Singaporean companies in Vietnam. The others are real estate and banking and finance.

In late May, Singaporean group COT worked with authorities of Vietnam’s northern province of Hung Yen on a venture there. COT is a major corporation in Singapore focusing on electronics and optoelectronics.

A representative of COT said that it will lease more than 6.6 hectares of land in Thang Long II Industrial Park to develop the project in November. Its manufacturing field is electronics, electro-optics, and VR.

“We will in the next five years expand the investment scale to $500-800 million, with the land area to increase to around 20 ha,” the representative added.

Elsewhere, in banking and finance, UOB was the first Singapore bank to set up a foreign direct investment advisory unit in Vietnam in 2013, to support the growing trade and investment flows into the country. In 2015, UOB and the Ministry of Planning and Investment’s (MPI) Foreign Investment Agency signed the first MoU (extended in November 2020) with the aim of increasing foreign investment and trade between Vietnam and Southeast Asia. Since then, it has helped over 250 firms expand into Vietnam, enabling the creation of more than 30,000 job opportunities and facilitated an investment flow of more than $5.8 billion.

In real estate, the top Singaporean developers are Keppel Land, CapitaLand, and Frasers Property. They are focusing on the Ho Chi Minh City market, with outstanding projects there including Saigon Centre, Empire City Thu Thiem, Saigon Sport City, and others which contribute to ranking Singapore as the city’s biggest foreign investor.

Cao Thi Phi Van, deputy director of Ho Chi Minh City Investment and Trade Promotion Centre, attributed Singaporean businesses’ interest to the city’s growing population, high economic growth, skilled workforce, and the improved business climate.

“Currently, Singaporean businesses eye investment in Ho Chi Minh City in the areas where the country has strengths such as IT, finance and banking, retail, real estate, and healthcare,” Van elaborated.

While commercial realty in Ho Chi Minh City is attractive to Singaporean enterprises, industrial realty and manufacturing in the southern province of Binh Duong are also enticing, with ventures such as Mapletree, Ascendas – Protrade, and VSIP.

In the north of Vietnam, Hanoi is one of the more appealing destinations for Singaporean investors. According to Hanoi statistics, last year, Singapore made up nearly 35 per cent of the city’s total foreign funding.

In anticipation of growing Singaporean investment, Hanoi is making infrastructure preparation to pick up new investment wave from the lion-island nation. Tran Thi Phuong Lan, director of Hanoi Department of Industry and Trade, said, “Hanoi has been strongly developing industrial infrastructure, preparing to develop industrial zones and clusters, aiming to have developed infrastructure by 2030 attractive to Singaporean enterprises to invest in production plants.”

Singapore was the largest foreign investor in 2022 in Vietnam with capital of up to $6.46 billion, accounting for almost one-quarter of the country’s total foreign investment.