It isn't clear whether Vietnam is more of a crouching tiger or a hidden dragon, but it seems obvious that it is well on its way to becoming an offshore power.
On the heels of Intel's decision to invest $1 billion in a semiconductor testing and assembly plant in Ho Chi Minh City, Taiwan's Hon Hai Technology Group, which produces electronics for the likes of HP and Apple, has announced plans to pour $5 billion into Vietnam. Hon Hai has already built two factories in Vietnam and has plans for several more, reports the Seattle Post-Intelligencer.
The Intel and Hon Hai investments are part of a broader trend of electronics manufacturers outsourcing production to low-cost locales in Asia. Research firm In-Stat predicts the Asian electronics manufacturing market will be worth $281.8 billion in 2011, up from $121.5 billion in 2006.
With foreign investment projects worth more than $8 million already approved for this year, Vietnam is on a pace to beat last year's record-setting $10.2 billion level of foreign investment.
Microsoft Chairman Bill Gates talked up Vietnam's potential as a site for software development, call centers and other types of commonly outsourced skills in a visit to the country last year.
Recruitment firm Harvey Nash, which earlier this year paid $1.8 million for a recruitment business based in Ho Chi Minh City, believes Vietnam's popularity as an offshore destination could rival India and China within five years, according to a story on silicon.com. Working in its favor: More than half of its population of 84 million is under 25, and 83 percent of its university graduates earn science-based degrees.
Some experts are more conservative than Harvey Nash, noting that Vietnam's educational system, which produces some 80,000 IT graduates a year, has catching up to do to match India's and China's 2.5 million graduates a year.