US President Joe Biden’s visit to Vietnam last month seems to have ushered in a new era of expanded economic links between the two countries, said Japan’s Nikkei Asia, adding that a fourth boom of foreign investment in Vietnam may be in the making.

The journal said the high-profile talks between the two leaders were accompanied by some big business deals. Vietnam Airlines, the national flag carrier, signed an initial agreement to buy 50 Boeing 737 Max jets in a deal valued at about 10 billion USD.

Vietnam’s leading tech firm, FPT Software, has announced a strategic partnership with the American startup Landing AI. Synopsys, a leading semiconductor design company, has signed a memorandum of understanding to help the Vietnamese semiconductor industry cultivate its chip-design workforce.

It recalled that historically, Vietnam has witnessed three significant booms in foreign direct investment. The first occurred when Honda Motor began local two-wheeler production in 1997. The second wave spanned the period from the early 2000s up to 2008. Notably, Samsung Electronics of the Republic of Korea launched a mobile phone production base in the northern Bac Ninh province in 2009.

The third boom is believed to have come into full swing in the mid-2010s. With its purchasing power increasing, Vietnam became a lucrative target for foreign consumer businesses. Japanese shopping behemoth Aeon, for instance, inaugurated its first Vietnamese store, Aeon Mall Tan Phu Celadon, in the country’s largest city, Ho Chi Minh, in 2014.

Now Biden’s visit may trigger a surge in US investment in Vietnam, the journal said. US investments in Vietnam have been modest compared to those by Asian economic powers like Japan or the RoK. As of the end of 2022, the total US direct investment in Vietnam was 11.4 billion USD, trailing behind the figures for countries like the RoK with 80.9 billion USD, Singapore 70.8 billion USD and Japan 68.8 billion USD.

During his visit to the headquarters of chip-making giant Nvidia in San Francisco on September 19, Vietnamese Prime Minister Pham Minh Chinh called on Nvidia CEO Jensen Huang to establish a production base in Vietnam and capitalise on it as its manufacturing hub in Southeast Asia.

PM Chinh also met with other prominent figures in the American tech sector, including Microsoft founder Bill Gates and senior executives from Meta, formerly known as Facebook, and Elon Musk’s SpaceX.

According to the article, Vietnam is keen to pivot from its traditional labour-intensive industries, such as garment manufacturing and electronics assembly, toward more value-added high-tech sectors. Collaborations with US tech companies, especially those dominant in the areas of semiconductors and AI, will be crucial for the transformation of the country’s industrial structure.

VNA