Vietnam Ranks 2nd Globally in Pioneering Locations Index: C&W

Vietnam comes second only to Costa Rica in the Pioneering Locations Index released by Cushman & Wakefield.


Vietnam has long been seen as an alternative to China when it comes to low-cost manufacturing. Photo: Internet

Vietnam ranks second behind Costa Rica in the Pioneering Locations Index within Cushman & Wakefield (C&W)’s latest global Manufacturing Risk Index report, indicating the Southeast Asian country holds high potential for global manufacturers.

The global report is a timely reflection of the country’s Manufacturing PMI rising to a record high of 54.2 in February, from January’s 51.9, C&W Vietnam said.

The Risk Index is a reflection of improvements that Vietnam has made and continues to make to how business is conducted in the country, said Alex Crane, general manager of C&W Vietnam.

The report shows that Vietnam has become a magnet for manufacturers due to its comparatively low labor costs (ranked lowest in our Pioneering Index), and has long been seen as an alternative to China when it comes to low-cost manufacturing.

“Considering the current climate of sluggish economic growth, containing costs to boost profits remains a critical imperative for manufacturers,” it adds.

“Over the last ten years, Vietnam has raised its overall productivity, prompting manufacturers to invest in billion-dollar manufacturing complexes across the country, a trend we anticipate will continue,” the report says.

Particularly in the manufacturing and industrial sectors, rather than seeing a hangover from the cancelled Trans-Pacific Partnership (TPP), it sees legacy benefits building confidence for overseas investors and companies.

According to the Foreign Investment Agency, committed foreign direct investment (FDI) in the country increased 21.5% year-on-year to $3.41 billion in the first two months of this year, of which 73% went to manufacturing.

Tuan Minh / BizLIVE