Samsung Display’s plans are to be officially approved by the North Vietnam government. Samsung will carry out expansion for five years starting in 2018, bringing the sum to be invested in the project to $6.5 billion and making it the largest project invested in by the South Korean giant.
During a press meeting on 3rd February, Minister-Chairman of the Government Office Mai Tien Dung, confirmed that government approval will be officially announced soon. The provincial government had earlier asked for government permission to offer tax incentives for the additional investment, which will enable the project to be classified as a large-scale project.
The plan for expansion is expected to be finalised in the first quarter of 2017, according to local media.
Samsung Display had originally built factories in Bac Ninh (Samsung Display Plans AMOLED Expansion in Vietnam) and Thai Nguyen in North Vietnam to assemble AMOLED panels into modules for use by Samsung Electronics’ smartphone factories. The AMOLED panels are transported from Samsung’s factories in South Korea.
In order to keep its market position Samsung Display has taken the decision to expand the factories in North Vietnam. This was possibly based on the belief that Apple is very likely to adopt AMOLED panels its new iPhone to be launched in 2017.
From a trade deficit of $3.5 billion in 2015, Vietnam returned with a trade surplus of $2.68 billion in 2016. Wage cost competitiveness is the key reason it is attracting capital away from other countries in the region. Revised investment and enterprise laws have cut the time needed to establish a new business. Lower corporate income tax rates and streamlined payments have also helped.
South Korean companies have deployed 592 projects worth a combined $8.6 billion in Bac Ninh, accounting for 65.6% of the total foreign direct investment in the province with Samsung being the largest single foreign investor totalling some $15 billion.
