South Korean fibre giant Hyosung is to increase its investment in Vietnam for all of its core products, including textiles, as it looks to utilise the country as a global production base.
At a meeting with Vietnamese Prime Minister Nguyen Xuan Phuc in Hanoi last weekend, Hyosung chairman Cho Hyun-joon agreed to bolster business cooperation between the two countries.
Since Hyosung established its subsidiary in the Nhon Trach industrial complex near Ho Chi Minh City in 2007, the company has invested around US$1.5bn on manufacturing units to produce its core products, such as spandex, tyre cords, steel cords and motors. Last year it invested $1.3m in Ba Ria Vung Tau in the southern part of Vietnam, and is now carrying out the construction of a polypropylene plant here, the DeHydrogenation (DH) facilities for the plant and the LPG storage tank.
Hyosung says it plans to convert the plant, whose capacity was increased by 300,000 tons last year, into a plant for producing polypropylene for pipes, a high-value-added product, and dualize the new propylene plant by producing general products in an effort to secure cost competitiveness and profitability, and maximise synergies.
The new investment plan will see the start of a chemical and heavy industry business for Hyosung in the country, in addition to its textile business. The company is also considering constructing an additional production subsidiary in Quang Nam in the central part of Vietnam.
Once the project is complete, Hyosung Vietnam will have attained a production base for manufacturing the products in all of its business divisions, targeting the global market “both in name and reality”, the company says.
“Hyosung, exporting to more than 60 countries around the world, is the largest investor carrying out various businesses in the northern, central and southern regions of Vietnam, and Hyosung Vietnam will become our outpost for advancing further into the global market,” said chairman Cho at the meeting. “We are planning to expand our business not only in spandex and tire cords, our leading global products, but also in chemicals and heavy industry.”
Hyosung Vietnam has already implemented an integrated production system for spandex and tyre cords to maximise production efficiency in the country.
The company says that by increasing its investment in Vietnam, it will allow Hyosung to realise the export competitiveness of its domestic product bases.
Chairman Cho also discussed infrastructure projects in Vietnam with Prime Minister Phuc. Vietnam urgently needs new power, roads, ports and urban development, due to its rapid economic development.
Cho said he is confident Hyosung will be able to capitalise on its technology and know-how in power transmission and construction to successfully carry out infrastructure projects involving Vietnam infrastructure.