Apple CEO Tim Cook announced Tuesday that the company will be expanding their investment in Vietnam. The previous day, Apple said that they would be spending on suppliers in the Southeast Asia manufacturing hub.
Apple started looking at moving their manufacturing to countries in this area after the COVID-19 pandemic disrupted supply chains in China, where the bulk of their manufacturing takes place. Vietnam and India are among the countries that Apple has expressed interest in doing business with. According to the state media outlet Voice of Vietnam, Cook’s recent comments were made during a visit by Vietnamese Prime Minister Pham Minh Chinh. Cook’s trip to Vietnam lasted two days, during which he met with the Prime Minister, students, programmers, and content creators. Apple also put out a press release on Monday that stated the company would increase its spending on suppliers.
In the press release, Cook said, “There is no place like Vietnam, a vibrant and beautiful country.” He added that Apple’s annual spending in the country had doubled since 2019. No further details were released about Apple’s plans.
Apple began doing business in Vietnam over a decade ago and has reportedly created 200,000 jobs there. The company had 26 suppliers with 28 factories in the country as of 2022. Most of these are located in the northern provinces and are directly connected to supply chains in Southern China, from which Apple is currently trying to distance itself. Northern Vietnam has long been seen as a hub for making electronics because of its wealth of skilled, cheap labor. The country is among the top five leading mobile game producers globally, which speaks to the leadership’s interest in technology.
Apple is one of several top tech companies that recently expressed interest in doing business in Vietnam. As an established hub of technological advancement, Vietnam presents an attractive alternative for companies trying to distance themselves from manufacturing in China. However, recent news from Vietnam has made some companies wary of investing.
A widespread and long-running anti-corruption campaign in Vietnam, referred to as the “Blazing Furnace” campaign, recently made its biggest arrest to date, which resulted in real estate tycoon Truong My Lan being sentenced to death. The highly publicized trial is the country’s biggest-ever fraud case and exposed a vast web of corruption involving many prolific members of society and major banking institutions. The enormous reach of the conspiracy left several companies wondering whether it was safe to do business in Vietnam.
Lan was convicted of fraud amounting to $12.5 billion, nearly 3% of the country’s GDP in 2022. According to state records, she was also found guilty of illegally controlling a significant bank and allowing loans that resulted in losses of $27 billion. Lan’s sentence, usually reserved for terrorists and murderers, indicates that the anti-corruption efforts have escalated. The campaign has been active since 2013 and championed by Communist Party General Secretary Nguyen Phu Trong. The case of Trihn Van Quyet, former chair of the real estate company FLC, which also owns Vietnam’s third-largest airline, will likely be tried next.
