VietNamNet Bridge – Vietnamese may have to buy houses in Vietnam from Chinese, while Chinese may live in Vietnamese houses. Will this happen in Vietnam, as experts warn, amid the Chinese wave of investment in the real estate sector?
Dr. Dang Dinh Dao, former Head of Hanoi Economics University's Economics and Development Research Institute, has warned that Vietnam needs to be cautious with the recent large Chinese investments in real estate projects here.
Dien Dan Dau Tu has quoted its sources as reporting that a Taiwanese group is planning to pour capital into an eco-tourism project in Hoang Tan Island in Quang Ninh Province. The project is expected to cover an area of 516 hectares and have the investment capital of over $1 billion.
A Hong Kong-based group, Texhong, has also injected its money into a project in Quang Ninh Province after getting the investment license for the first phase of the Hai Ha Industrial Zone development project in Hai Ha District.
Prior to that, local newspapers reported that Chinese Foshan Sanshui Jialida, Hong Kong’s Luenthai and Vietnamese Vinatex have announced plans to develop the Rang Dong Textile and Garment Industrial Zone in Nam Dinh Province, to be capitalized at $400 million.
A report of the Foreign Investment Agency showed that Chinese capital flow to Vietnam in the real estate and textile & garment sectors has increased sharply. The investment capital registered by Chinese in 2013 was seven times higher than that of 2012 ($2.3 billion vs. $345 million).
A lot of merger & acquisition deals in the real estate sectors have been reported by local newspapers recently, in which Chinese are the buyers.
While Vietnamese real estate developers rush to sell their projects in the context of the gloomy market, Chinese have been flocking to Vietnam to take over the projects.
Worries have been raised that Chinese may be doing this on purpose, as a part of a scheme to gradually control the Vietnamese real estate market.
Dao, in an interview given to the local press, said Vietnam should learn a lesson from all the drubbings it has taken when doing business with Chinese in many business fields. And Vietnam needs to be “more cautious” and “of sound mind” when dealing with Chinese in real estate projects.
Once Chinese jump into the Vietnamese market, Vietnamese investors may suffer setbacks right on their home market. When Chinese start buying real estate projects here and become owners, Vietnamese will have to buy houses from them.
Bui Kien Thanh, a well-known economist, also thinks that Vietnam should not be too eager for Chinese investments in the real estate sector.
“It is important to determine if the Chinese harbor non-economic motives when trying to buy real estate projects in Vietnam,” Thanh said.
Thanh, in an interview given to Dat Viet, pointed out that Chinese are leasing hundreds of thousands of hectares of land in the northern mountainous areas of Vietnam. They have also been present in many other localities in Vietnam, where they lease large land plots for 50-70 years and then build walls around them.
Compiled by K. Chi
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