The Hand of Friendship, a Word of Caution: Koreans Settling in Vietnam
Vietnam’s role in South Korea’s history is certainly not as deep as those of the ROK’s immediate neighbors (including, of course, its veritable fifth neighbor, the US). Nevertheless, Vietnam has become an alternative destination for those enterprising Koreans who wish to inject their entrepreneurial spirits into a new land. Yet as one columnist warns, while Vietnam has become a prime substitute for Koreans who no longer wish to call China their home away from home, both policymakers and intrepid settlers must not forget how quickly relations with ostensible partners can turn sour.
[First Impressions] Korea Rising in Vietnam: Time to Remember the Lesson from China
The very first thing people see when they arrive at the international airport in Ho Chi Minh City, Vietnam’s economic capital, are signs for the Hyosung Corporation and Shinhan bank. Leaving the airport, signs advertising Samsung’s Galaxy Z Flip4 line the road. The fact that one can smell Korea even after stepping off the plane is proof that Korean companies and people have begun to leave their mark on Vietnam.
In the Bến Thành area of Ho Chi Minh City, in which Vietnam’s tallest building, the 81-story “Landmark 81” is located, a new Koreatown is taking shape. There are an increasing number of signs representing Korean companies in this upmarket area of the city. In addition to Tous les Jours, which ranks first in Vietnam’s bakery market, there are already over 200 GS25 convenience stores, as well as signs for Woori Bank, which has been a top performer since gaining legal status in Vietnam in 2017. Aside from K-Mart, which seems to have bought stores as they are, there are rows of Korean-language signs advertising eateries serving Korean food standing side-bysode, along with some signs in Vietnamese. At the GS25 selling instant tteokbokki, there are more Vietnamese than Koreans enjoying themselves.
The more you go about this brand-new Koreatown in Ho Chi Minh City, the more one sees how the atmosphere is the polar opposite of that of Beijing’s declining Koreatown. The vibe in Beijing’s Koreatown, called “Wangjing”, changed rapidly during the controversy over THAAD in 2017 as anti-Korean sentiment grew. At one point being the home of 120,000 Koreans, “Wangjing” has completely lost its Korean flavor after going through the fallout from THAAD as well as the “zero-Covid” policy. Signs have come down from “Korean Castle”, a building that hosted several Korean restaurants, and Korean companies have been leaving China one after the other, while the Korean faces that were once seen on the streets have been replaced with Chinese faces. Korean restaurant owners have been leaving Wangjing and settling in Vietnam.
A mere look at trade indices shows how much South Korea’s relations with Vietnam and China have changed. Last year, Vietnam became South Korea’s largest trade surplus partner for the first time last year. In 2022, South Korea’s trade surplus with Vietnam was USD 34.2 billion. In contrast, trade with China, which was once South Korea’s biggest trade surplus partner, has now become its biggest trade deficit. This state of affairs has held ever since recording a trade deficit with China last October.
Korean companies who have come to realize the difficulties of continuing to operate in China are turning their gaze toward Vietnam. Half of Samsung’s smartphones are produced in Vietnam, and the country recently built the largest R&D complex in Southeast Asia. Samsung Electronics has made a large-scale investment of KRW one trillion and from this year and will operate a factory manufacturing parts for semiconductors. 20% of Vietnam’s exports are Samsung products.
In order to earn the title of “the workshop of the world”, China made a “love call” to foreign companies, including those from Korea, but once they had achieved their goal, they did an about-face, making Vietnam a decent exit point for those wishing to leave China. A “young country” with half of its population under 35 years of age, wages are also lower, making it the ideal alternative to China, with its aging population, as the “workshop of the world.”
Nevertheless, South Korea needs to be cautious about a Vietnam where Korean influence is spreading quickly. We cannot lose sight of the fact that the situation could change at any time. Former Vietnamese leader Nguyễn Xuân Phúc, who has been friendly toward Korea, has resigned, and the rise of Nguyễn Phú Trọng, the pro-China secretary-general of the Communist Party of Vietnam, is something that Korea will need to watch. We fully bought into the idea of China as our closest neighbor, but now the bilateral relationship cannot be mentioned without the word “retaliation”, so now is the time for us to ponder this lesson.
Original article by Park Sun-mi. Translated by Anthony V. Rinna.
 Source: [First Impressions] Korea Rising in Vietnam: Time to Remember the Lesson from China [초동시각]베트남에 스며든 한국…중국의 아픈 교훈 새길 때, The Asia Business Daily, February 3, 2023 https://www.asiae.co.kr/article/2023020211103267598