Companies settled in Kaicheng Industrial Park invest and build factories in Vietnam

According to a Yonhap News Agency report on July 25, according to the Kaesong Industrial Park Enterprise Association, companies settled in the Kaesong Industrial Park have gone to Vietnam to invest and build factories since the industrial park closed in February 2016. A total of 123 companies were initially settled, and currently about 30 have invested in Vietnam. Vietnam’s wage system is divided into levels 1-4 according to urban and rural areas, and has increased by 6.5% in the past two years. Younginner, an underwear manufacturer, set up its first factory in Ho Chi Minh City, Vietnam, three months after it withdrew from the Taicheng Industrial Park. It is currently building a second factory in the suburbs of Ho Chi Minh City, a three-hour drive away, and is expected to start construction in May next year. According to a representative of Younginner, as a labor-intensive production company, it has to choose a place with relatively easy employment conditions; the area where the second factory is located falls within the level 3 wage range, and the per capita monthly salary is only US$270, which is US$1,600 when meeting the minimum wage conditions in South Korea. Much cheaper than that. In addition, if the Kaicheng Industrial Park reopens and the material costs are included in labor costs, the per capita monthly salary will also reach US$500, which is a smaller cost advantage compared to Vietnam. The advantage of Kaicheng Industrial Park is that it belongs to Made in Korea (Made in South Korea) and is relatively close, so logistics and communication costs are low. (Title: Companies settled in Kaicheng Industrial Park invest and build factories in Vietnam)