On day 8 of our trip to Vietnam, we had two site visits in Binh Duong to the Vietnam Singapore Industrial Park (VSIP) and II-VI, which is a company located inside of VSIP. The first visit was to VSIP. We learned that VSIP is a joint venture between Singapore and Vietnam, and that some of their competitors involve other joint ventures between Vietnam and countries such as Cambodia. We learned about the benefits of these joint ventures, such as convenience for the companies and high profitability. There are multiple industrial parks created as part of this joint venture and they are located all across the country. The joint venture seems to be working well as they have attracted many big-name companies such as PepsiCo. We learned about the tax incentives that come with opening up in VSIP, and how there are many other benefits, such as a school and residence located in the park.
After our visit to VSIP, we went to a mall located in the industrial park for lunch where we ate udon, which tasted like a combination of Ramen and miso soup but was really good. We then had an hour to walk around the mall and I noticed that a compared to the rest of the country the prices were really high and were about the same as they would be in the US.
After the mall, we went to visit II-VI, a company located inside VSIP. II-VI are technology manufacturers, and we were able to visit their photonics and advanced optics manufacturing plants. They are a company based just outside of Pittsburgh, but they manufacture their high volume, low cost products offshore, mainly in Asia. Part of the reason they moved to Vietnam was because of the huge tax incentives provided, as well as much cheaper labor costs and access to the rest of Asia. During the visit, we also learned about some of the challenges the company faces with the workforce, such as workers saving money to go home for the holiday of Tet, and just not coming back to work after the holiday. The company learned this lesson during the first year of operating in Vietnam and has since implemented worker incentives to make sure that the job turnover rate doesn’t get too high.
Overall, I thought the two site visits were very informative and interesting to consider when thinking about the development of the country.