Chinese exports with VN labels could impugn reputation: experts
VietNamNet Bridge - Economists, warning about increasingly high investments by Chinese in Vietnam, are concerned that Chinese products made in Vietnam and bearing Vietnam labels may bring a bad reputation to Vietnam’s products.


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Mrs Pham Chi Lan


A report from FIA (Foreign Investment  Agency) showed that China has surpassed Japan, the US and other countries to become the third biggest foreign investor in Vietnam, after South Korea and Singapore.


In the first three months of 2017, Chinese investors registered 58 investment projects and 177 capital contribution deals in Vietnam, worth $823 million in total.

Nguyen Duc Thanh, head of VEPR (Vietnam Institute for Economic and Policy Research), noted that FDI from China in the first three months of the year was equal half of the capital registered by investors from the country in the entire year of 2016.

Explaining the strong flow of FDI capital from China, Thanh said Chinese labor costs have been increasing rapidly, which has prompted foreign investors in China to leave the country and has encouraged Chinese businesses to make outward investments.

In principle, Chinese investors, like investors from other countries and territories, are treated equally. However, Vietnam has reasons to be cautious with investments from China because of its outdated technologies and the lack of transparency in doing business.

“It is not true that China doesn’t have high technologies,” said Truong Dinh Tuyen, former Minister of Trade. 

Economists, warning about increasingly high investments by Chinese in Vietnam, are concerned that Chinese products made in Vietnam and bearing Vietnam labels may bring a bad reputation to Vietnam’s products.
“What concerns Vietnam is that China, while striving to upgrade its economy, is attempting to relocate its old factories and transfer outdated technologies to neighboring countries,” he said.

Tuyen and many other economists fear that if Vietnam doesn’t change its thoughts, Vietnam would become the dumping ground for old Chinese machines and technologies.

Meanwhile, Pham Chi Lan, a renowned economist, and former deputy chair of VCCI, has expressed her concern about the fact that Chinese enterprises manufacture products in Vietnam and label the products as Vietnam’s products, which may bring a bad reputation to Vietnam’s real products.

According to Lan, China has a surplus in trade relations with most of the countries in the world. “If Chinese enterprises relocate production to Vietnam, their products would turn into ‘made-in-Vietnam’ products,” Lan said.

The US and Australia have raised doubts that some steel exports are not products of Vietnam. She said that not only Vietnam, but many other countries have concerns about investment capital flow from China.

“Some African countries also have concerns like ours about Chinese products made in Africa,” she said, commenting that if Vietnam continues receiving a lot of FDI from China, importing materials and components to assemble, it will become the country which exports products for China.
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