TheLEADER talks with David Nardone, group executive – industrial and international of WHA Industrial Development Plc about WHA Vietnam's development journey as well as its expansion plans for the upcoming time.
As a leader of an FDI enterprise investing in Vietnam, how do you view Vietnam's changes over the past four years?
David Nardone: Since 2017, Vietnam’s economy has seen robust growth driven by strong fundamentals. Specifically, for potential international investors, Vietnam offers a unique combination of key strengths.
Firstly, with its overall proximity, Vietnam’s location is strategic as it offers a gateway to major markets, thanks to well-developed transportation infrastructures.
Secondly, Vietnamese workforce is a strong asset of the country as it is large, young, and skillful.
Thirdly, after more than 35 years of reforming and integrating with the world economy, Vietnam has become one of the most open economies among the developing countries.
Seventeen free trade agreements (FTAs) have been signed, such as the most recent and impactful Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Free Trade Agreement between Vietnam and the European Union (EVFTA). Recently, Vietnam also signed two new FTAs, including the Regional Comprehensive Economic Partnership (RCEP) and the Vietnam - UK Free Trade Agreement (UKVFTA).
Last but not least, the country has been one of the most dynamic economies in the world with high GDP growth, large FDI inflows, and high export growth.
We believe Vietnam will see increasing integration of manufacturing supply chains in the chemical and metal sectors, as well as growing investments for the production of higher-value products such as consumer electronics. Environmental care is also increasingly becoming a priority for both the public and private sectors.
Along with those changes, how has WHA Vietnam changed?
David Nardone: WHA selected Nghe An Province to develop our first international industrial zone project. Questions were raised over our decision on the province while other places were more developed in terms of infrastructure.
We considered that the project offers a strong cost advantage to potential investors with competitive lease rates, attractive tax and non-tax incentives. Nghe An province has the 4th largest labor pool in Vietnam; however, young and talented people had to find jobs in big cities as they found low chances to find suitable jobs in their hometown.
Also, with continued government infrastructure investments, Nghe An province can offer fast-improving connectivity and logistics.
WHA has leveraged 30 years of experience in Thailand to develop an international standard industrial zone equipped with the highest quality infrastructure, utilities, and environmental care.
In line with the WHA Smart Eco concept, WHA projects provide unique features including a waste-water natural treatment solution, online air quality monitoring, and a centralized control room. Phase 1A, covering a gross area of 145 hectares, is completed and 52 per cent of the sellable land has been leased to customers in food processing, building materials, and apparel, with a large investment in the electronics sector.
2020 was a year of turmoil, especially due to Covid-19. As a foreign businessman, how do you view the "Vietnamese story" in 2020 in general? Did WHA experience a crisis in the past year?
David Nardone: Vietnam has largely been seen as one of the bright spots, due to its handling of the Covid-19 crisis and compares favorably against most countries in the world. While growth in FDI inflows has slowed, investment values remain large. Vietnam’s 2020 exports grew double-digit year-on-year.
In line with our WHA Group policy and prudent Risk Management, WHA teams have taken necessary actions and precautions to ensure no disruption in our customers’ operations.
WHA’s crisis response plan includes the implementation of a crisis management team, responsible for assessing new developments and resulting risks on a daily basis, developing adequate risk mitigation actions, and coordinating remedial actions.
Specifically, a Business Operation Continuity Plan was developed to ensure our customers face no disruption in their operations and provisions of required utilities or other critical products and services. Such action plan includes multiple back-up sites and rotating operations teams, IT equipment to enable remote working, access to necessary data and software, use of collaboration and other video and voice communication tools, workforce and health protection measures in line with best practices.
Do you think that industrial real estates still have many opportunities in Vietnam in the past year despite being placed in the context of the Covid-19 pandemic?
David Nardone: Vietnam has been one of the preferred destinations of international investors. It is also one of the major beneficiaries of supply chain relocations, partly driven by US-China trade tensions.
How has WHA captured this opportunity?
David Nardone: As we are seeing increasing customer demand for industrial land, WHA is accelerating its expansion in Nghe An Province to develop the remaining phases 1B, 2, and 3. Phases 1B to 3 will add another 1,050 hectares upon completion over the next 2 to 6 years.
WHA is also expanding in Thanh Hoa province and signed a Memorandum of Understanding last December with Thanh Hoa Provincial People’s Committee for the development of another two industrial zones representing a total gross area of nearly 1,050 hectares, marking a new major milestone in WHA Group’s international expansion. Thanh Hoa province is well-positioned with its population, location, and upstream industry in place at Nghi Son Economic Zone.
As a Group, WHA is also expanding in Vietnam with increased investments in both tap and industrial water through its Group affiliate WHA Utilities and Power PLC.
Further plans for expansion are being explored for other parts of WHA Group such as the Power sector, in line with increasing demand for renewable energies, as well as in Logistics properties development, driven by strong domestic consumption and e-commerce trade growth.
Vietnam is a key strategic area of expansion for WHA and takes a very prominent part in WHA 2021 - 2026 strategic plan.
Thank you very much!