A Standard Chartered Bank study highlighted the fact that increasingly-competitive Vietnam is now the “best choice” for China-based investors who want to relocate their production base. But the exodus may be delayed by Vietnam’s restrictions on imports of used machinery and equipment.
The research was conducted between February and March 2015, with more than 290 responses from manufacturers operating in China’s Pearl River Delta (PRD), which includes nine cities in Guangdong province.
As a notable indicator of the production exodus from China, Microsoft has shut down its two Nokia mobile phone making plants there in favor of a new location in Vietnam. It will expand its existing $200 million mobile phone factory in Bac Ninh province’s Vietnam-Singapore Industrial Park, and will triple its employees from 5,000 to 15,000 in the near future.
However, Vietnam’s restrictions on imports of used machinery and equipment are expected to delay the FDI.