Why More Goods Will Be Labeled ‘Made in Vietnam’

October 20, 2015.

In Long An, Vietnam, a large rural span south of Ho Chi Minh City, huge factories have been planted and have started manufacturing goods for Western companies like sportswear maker Nike Inc. Companies like this are taking advantage of the young workforce and extremely cheap wages in Vietnam, which are about half the amount of the wages in China. Long An, which is a largely agricultural place with a spread of pineapple fields and mango trees, now has more than 12 industrial parks and is increasingly becoming the home to foreign manufacturing. Earlier this past May, the forecast for foreign investment reached $3.67 billion, with about 40% of it for the garment and textile industry. Global trade is shifting and Vietnam will be manufacturing a lot more goods in the new future. We will start to see a lot more products labeled ‘Made in Vietnam,’ maybe more than we’re used to.

Louie Nguyen, CFA is the CIO of San Diego-based Soledad Investment Management. Soledad invests qualified clients’ assets in markets around the world, including Vietnam.