Vietnamese economy turns aroundFor Korean investors, the Vietnam Fund has been regarded as the fund of tears since the Vietnamese economy began to tumble in 2008.
Nevertheless, the Vietnam Worldwide Mix 1 fund showed first-quarter earnings of 23.72 percent at Korea Investment Management, the best performance of overseas mixed funds, as well as domestic and international equity funds.
The top seven funds by rate of return were all Vietnamese funds, with the seventh fund recording 18.49 percent.
Kim Young-il, chief investment officer of Korea Investment Management, said Samsung Electronics is changing Vietnam and that it is a market worthy of long-term investment.
Q. What do you mean Samsung is changing Vietnam?
A. In 2012, Samsung Electronics’ Vietnamese unit accounted for 11 percent of Vietnam’s total exports. Last month, it also began operating its second factory. When the first and second factories are operating at full capacity, half of Samsung’s smartphones will be produced in Vietnam.
LG Electronics is also building a home-appliance production plant in Vietnam. As the global production base moves from China to Vietnam, the country that had a trade deficit for the previous 20 years has posted trade surpluses in the past two years.
How has the situation changed from the late 2000s?
The Vietnamese government has embarked on financial reform. A case in point is the monopolization of gold trading in order to prevent inflation. As the currency’s value fell due to inflation, ordinary people started investing in gold and the value of the currency fell even more.
As the central bank monopolizes the gold trade, the currency is being stabilized. The economic structure, the fundamentals of the economy are improving.
Are you saying it is worth the investment?
It is an attractive market for long-term investment as its fundamentals are being improved.
BY JUNG SUN-EON [firstname.lastname@example.org]
with the Korea JoongAng Daily
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