Before the global tech supply chain recently shifted its way, Vietnam’s Bac Giang province was one of the nation’s poorest regions, known for producing rice, lychees, and poultry dubbed “running chicken.” Now officials in the rural area north of Hanoi host representatives from Apple and Hon Hai Precision Industry Co.
The growth in foreign investment is almost doubling every year — even during the coronavirus pandemic — and the province forecasts the value of exports this year will reach $11 billion, a tenfold leap in six years. Residents have swapped loud, dirty motorbikes for new Honda two-wheelers while others drive Toyota SUVs and Mercedes sedans on freshly paved roads.
“Life is heaven now and it’s thanks to the factories,” said Nguyen Van Lanh, 64. His family, which once couldn’t afford to buy meat, runs boarding rooms for workers built with their factory salary savings. One relative with a loan business for plant employees drives a red Mercedes-Benz.
The boom in Bac Giang highlights how the shift in the world’s supply chains is touching regions previously left behind. Vietnam’s ability to attract more sophisticated manufacturing is accelerating with rising Chinese labor costs, the U.S.-China trade war and logistics vulnerabilities amid the epidemic… Its 2010 per capita income was $650, about half that of the nation overall, according to government statistics… Now the province is experiencing its first boom as per capita income is forecast at $3,000 this year.
MacDailyNews Take: Ah, the ripple effects of Apple’s move to seriously begin diversifying production are being felt in Vietnam and elsewhere.