Why should Shareholders invest in Electronics Manufacturing Services in Viet Nam and what are the Competitive Core Values that make Trung Nam EMS become the best choice?

Electronics Manufacturing Services (EMS) companies are those that design, manufacture, test, distribute, and assemble original or non-original electronic components.

Popular manufacturing activities include PCB/Cable Assembly, Test & Burn In, Prototyping, Box Build, and other services.

The range of this industry is primarily developing in China due to its significant potential of material sources for timely production and cost reduction.

Viet Nam, with its geographical location directly adjacent to the world’s largest supplier, has been designated as a vibrant and dynamic market for competitiveness in the electronics manufacturing industry and become the next destination that Foreign Investors are looking for.

Viet Nam – New Electronic Manufacturing Services Opportunities that Foreign Investors Must Seek

Investors frequently consider three factors when choosing an investment location: easy access to the world’s largest supply chain, labor costs, and taxes. Vietnam not only meets all of these criteria, but it also has the following outstanding features: 

• Southeast Asia’s third-largest market
• Stable political and complete legal systems
• Diversified, skilled, and talented workforce
• Easy access to large domestic and international markets
• Received the Information Technology Agreement (ITA) support regarding tax rates for electronics manufacturing services after joining WTO
• On the verge of completing new Free Trade Agreements such as TPP, EU-Vietnam FTA…

As a result, Vietnam has gradually become one of the top choices for developing Electronics Manufacturing Services businesses, as well as creating opportunities for Viet Nam and Foreign Shareholders to collaborate and associate.

Nowadays, businesses looking to locate their factories in Vietnam have numerous options. And, with our competitive core values, Trung Nam EMS is one of the most reliable options for investors to develop their jobs quickly and safely.

Trung Nam EMS – Competitive Core Values

1.     Developer: Trung Nam Group

Trung Nam Group – a developer and parent company of Trung Nam EMS has participated in many sectors including Energy, Infrastructure, Construction, Real Estate, and Information Technology – Electronics Industry.

As a strategic goal during this period, both Trung Nam EMS and Trung Nam Group are focussing on the Da Nang IT Park project to turn this area into one of the best IT, Electronic Manufacturing communities in Southeast Asia, following the Silicon Valley model of the United State.

With 341 ha of total space and up to 121 million USD of investment capital, Da Nang IT Park has been divided into 4 function areas in turn the Manufacturing, Service, Mix-used, and R&D area. Currently, in addition to electronic services, there are ready-built offices and factories for lease in Da Nang IT Park land.

2.     One-Stop Shop Service

Complex processes could be a big challenge for foreign investors who intend to build electronic service manufacturing factories/companies in Vietnam.

A brief overview of administrative procedures that the shareholders must go through when starting a business in Vietnam, investor certificate, information on investment policies, certificate of satisfactory funding, and investment registration, etc… The application can be processed from 15 days to a month or even more for contractors to complete, not to mention the risks and errors that may occur during the process.

Instead of going back and forth with these complex procedures, all that the investors need to do is just collaborate with Trung Nam EMS, this is the One-Stop-Shop service that we provide to help our customers achieve their goal as soon as possible.

During the pre-investment period, Trung Nam EMS will provide information, organize site inspections and support all the administrative procedures as a representative of the stakeholders. Finally, we will assist investors overcome arising issues to help electronic manufacturing enterprises quickly put into operation.

3.     Tax Incentives

To fully support FDI entering the electronic services industry in Vietnam, Da Nang has established several special incentives, including tax exemptions for companies in this field. Therefore, Electronic manufacturing companies become Trung Nam EMS stakeholders will take numerous benefits from duty reductions.

Aside from enjoying all prescribed policies, investors are exempt from paying Corporate Income Tax for the first four years. Furthermore, you only have to pay 5% of taxes for the next 9 years, and 10% for the remaining two years. After 15 years of the tax-free policy, Electronic Manufacturers begin to implement state-mandated tax rates of about 20-22% after making a profit.

Da Nang IT Park, in particular, has been exempted from import tax on machinery and materials that cannot be produced domestically and from preferential export tax for IT products and services.

4.     Human Resource

The strong development of electronic services has required a great deal in terms of quantity and quality of human resources. To maintain business activities, Trung Nam EMS annually organizes activities to build up a strong relationship with career introduction centers, vocational centers, colleges, and universities.

According to IPA Da Nang, currently, more than 589.583 workers are arriving Da Nang from other Central provinces. The tech workforce is steadily growing (low turnover rate, almost no strikes), with approximately 25.000 skilled graduates from 36 universities, colleges, and 70 vocational schools.

5.     Low-wage workers 

According to the research, Da Nang currently has an advantage of minimum wage for workers lower than Ho Chi Minh and Ha Noi because of its reasonable cost of living and abundant labour resources.

In Da Nang, living expenses such as accommodation, food, etc…are inexpensive and affordable for everyone. Therefore, workers here are mostly satisfied with their income and tend to have long-term commitments with their companies. Moreover, there are only a few electronic manufacturers in Da Nang while a large number of workers are seeking jobs.

Precisely for those reasons, businesses just need to spend reasonable labour costs on running their factories when investing in the Da Nang IT Park project.