Vietnam Special Entry Surpasses 3,000... Achievements in Factory Construction and Export Contracts

[Asia Economy Reporter Kim Hyewon] # Companies A and B are participating in the construction of a chemical plant worth 1 trillion KRW. Company A was responsible for the most basic electrical facilities for the construction progress, while Company B was in charge of a 500 billion KRW project, needing to hire local contractors and manage the project. Fortunately, project managers were able to enter Vietnam in a timely manner through special entry, allowing the basic stages to proceed.

# Small and medium-sized enterprise C, which produces and exports sportswear in Vietnam, had to deliver an order of 1 million pieces received at the beginning of the year. However, without local Korean management staff and with difficulties entering due to COVID-19, production management was at risk of disruption. Thanks to special entry into Vietnam, they were able to manage factory production and successfully complete the delivery, subsequently receiving an additional order of 5 million pieces (worth approximately 39 billion KRW). However, since they must return to Vietnam, employees are reluctant due to the long quarantine period, and they hope the quarantine duration will be shortened.

It has been investigated that businesspeople who entered Vietnam through special entry, where general entry has become difficult due to COVID-19, are achieving results such as factory construction and export contracts through business activities.

According to the 'Post-COVID-19 Vietnam Special Entry Status Survey' conducted by the Korea Chamber of Commerce and Industry (KCCI) targeting about 300 companies using Vietnam special entry, companies have achieved outcomes such as factory construction and operation, and signing new contracts. Company E secured a 30 billion KRW order contract through technology and equipment demonstrations, and construction company F succeeded in winning a 6 billion KRW contract through face-to-face consultations, citing difficulties in building trust via video conferences. Electronics parts manufacturer G, involved in a joint project among three companies, noted limitations of non-face-to-face meetings and was able to establish and initiate new business plans through face-to-face meetings.

Vietnam special entry is a procedure organized by KCCI to enter Vietnam, where foreign entry has been banned since March 22, via special charter flights. Businesspeople undergo COVID-19 testing in advance and can engage in business activities after 14 days of local quarantine. The total number of special entry users has surpassed 3,000, currently standing at 3,246. A total of 1,528 companies have used Vietnam special entry, including 2,793 businesspeople and 453 expatriate family members. Special entry has been conducted 13 times from the first visit on April 29 to November 5, with no COVID-19 positive cases among visitors.

54% Enter for Factory/Business Site Management... 67% of Businesspeople Satisfied with Special Entry but Hope for Shorter Quarantine

The purpose of special entry into Vietnam was reported by 53.8% of companies as 'factory/business site management.' This was followed by 'product installation and commissioning' (25.1%), 'buyer discovery and marketing' (6.6%), and 'new contract signing' (5.6%).

Among companies entering Vietnam, 67.3% responded that they are 'satisfied' with the special entry process. 'Neutral' and 'dissatisfied' responses were 20.1% and 12.6%, respectively.

Regarding improvements needed by the governments of both countries related to special entry, 60.6% of companies cited '14-day quarantine domestically and abroad.' This was followed by 'simplification of document procedures' (41.8%), 'expansion of flight options' (35.0%), and 'prompt departure support' (29.0%). Regarding improvements to the 14-day quarantine, 7 out of 10 companies (70.4%) selected 'shortening the quarantine period.'

A KCCI official stated, "Since companies are achieving tangible results through Vietnam special entry, we will review even small details again and strive to be helpful. Continuous efforts by both governments are needed to improve entry procedures, such as shortening the quarantine period, so that exchanges among businesspeople can be more active."

31% Have "No Measures" for Prolonged COVID-19... Biggest Export Difficulty is 'Movement Restrictions'

Regarding measures for local business in case of prolonged COVID-19, 'management improvement such as restructuring' was the most common response at 34.1%. This was followed by 'no measures' (30.5%), 'expansion of video consultations' (20.8%), 'local business reduction' (20.1%), 'domestic return' (9.3%), and 'business transformation' (8.6%).

Regarding non-face-to-face business such as video consultations, 52.1% of companies responded that it is 'partially replaceable,' while 41.6% said 'cannot replace offline meetings.' Since non-face-to-face business cannot completely replace offline meetings, it is interpreted that more companies intend to reduce local business in the long term to overcome the COVID-19 situation.

Regarding recent exports, companies cited the biggest difficulty as 'movement restrictions due to COVID-19' (62.4%). This was followed by 'business slowdown due to economic recession' (27.6%) and 'deterioration of trade environment due to protectionism' (7.2%).

Woo Taehee, Executive Vice Chairman of KCCI, said, "In the situation where the global value chain is being reorganized and the global management environment paradigm is shifting to untact due to COVID-19, our companies face the dual challenge of coping with this and overcoming the current COVID-19 crisis. It is time to ease regulations and for the public and private sectors to join forces to revitalize the economy and enhance corporate competitiveness, and I hope that special entry supporting businesspeople’s movement will be the starting point."

This content was produced with the assistance of AI translation services.