[The Editors' Verdict] Post-China Vietnam: Reality or Wishful Thinking?

Vietnam in the Global Spotlight with Many Options
What Vietnam Needs to Become the Land of Opportunity Instead of China
Long-term Strategy Needed, Not Just Vague Expectations

When South Korea faced Brazil in the Qatar World Cup, which country did the Vietnamese people support? If you thought of the Korean Wave effect, you would be mistaken. The fact that Samsung Electronics accounts for 20% of Vietnam's exports, making it important to them, does not lead to the correct answer either. Vietnamese social media is flooded with posts mocking South Korea for their 1-4 defeat.

There was a recent report that Vietnam has become our largest trade surplus country. Its importance as a production base replacing China was once again emphasized. The experience of relying on China for 97.7% of urea solution and then being blindsided, which made the need for 'diversification' clear, was also recalled. It is certain that Vietnam will become the 'post-China,' and there is analysis that we have secured a favorable position by actively engaging in trade and exchanges over the 30 years since establishing diplomatic relations.

But why did the Vietnamese people not support Park Hang-seo's country? Summarizing the words of a businessman who entered Hanoi, it goes roughly like this: The Vietnamese Communist Party early on set South Korea as a competitor that must be caught up with. This policy stance is ingrained in a significant portion of the Vietnamese population. Unintentionally, we had become Vietnam's rival.

The image Vietnam has of South Korea changed significantly due to COVID-19. Vietnam maintained high growth even during the COVID-19 period. An 8% growth rate was expected last year, and over 6% this year. From Vietnam's perspective, surpassing South Korea, which has fallen into a low-growth trap, is just a matter of time and an easily reachable target.

What fueled this confidence was the news of Foxconn's factory relocation, which manufactures Apple iPhones. Geopolitical risks are leading global companies to decide to leave China. Now, Apple's core products will be produced in Vietnam as early as May. Not only companies but also the United States, Japan, and China are sending love calls to Vietnam at the national level. If we recognized their strategic value, other countries did as well. The US, Japan, and China even have significant diplomatic and security levers that we do not possess.

In a situation where the eyes of many advanced countries and global companies are focused on Vietnam, we need to calmly reconsider whether we have fallen into the misconception that Vietnam will welcome us eagerly if we just want it. Does our government even intend to manage the anti-Vietnam sentiment within Korea and the opposition atmosphere locally?

A sober analysis is also needed on whether Vietnam will truly develop into the 'world's factory' replacing China. According to Sujan, head of the World Politics Research Center at the China Foreign Affairs University, who spoke to the domestic specialized media China Lab, unlike China, which had a solid heavy chemical industry base, Vietnam only has favorable conditions in trade terms such as tariffs. Therefore, Vietnam may not reach the position of replacing China but may only play a role in complementing the Chinese market. Vu Dinh Anh, dean of the Fulbright University Vietnam, also recently told the Korea Economic Daily in an interview that Vietnam is trying to be selective about foreign direct investment.

Vietnam, which wants to be incorporated into the global supply chain, has many options besides Korea or Samsung. The illusion that Korea is Vietnam's best partner may be our own hope. We must promptly initiate the establishment of multifaceted strategies such as long-term diplomatic strategies, diversification strategies that avoid repeating failures of putting all eggs in one basket with a specific country, and managing public sentiment. The road ahead is long, and the reality is clear that we are not standing at a very advantageous starting line.