Another country feeling the economic brunt of a political maelstrom is Vietnam. Thousands of Vietnamese went on the rampage last week, setting fire to foreign factories and causing damage to industrial zones in Binh Duong and Dong Nai provinces near Ho Chi Minh City.
They were protesting after a Chinese state-owned oil company placed a giant oil rig in part of the South China Sea also claimed by Vietnam.
One of the biggest victims of the violence was Formosa Plastics Group, Taiwan's biggest investor in Vietnam, which is building a giant steel plant in the Ha Tinh industrial park, one of the facilities which are central to the country's €101 billion economy.
The country has 190 registered industrial parks and they employ about 2.1 million people. About one-third of Vietnam's export revenues come from these industrial parks.
Economic impact
The Formosa Plastics plant was set on fire after fighting between its Vietnamese and Chinese workers, in which one Chinese worker was killed and 90 others injured. When it is finished in 2017, the plant is expected to be south-east Asia’s largest steel-making facility.
The whole Ha Tinh industrial park is estimated to cost more nearly €15 billion and it is more than half complete. When finished in 2020, it will have a port, a 2,100-megawatt power plant and six furnaces.
It was the economic impact the Chinese focused on in reacting to news of the violence.
"Companies and investment projects from the Chinese mainland, Taiwan and other Asian countries and regions have been affected. It was reported that Taiwan investors suffered the greatest loss," ran an editorial in the Global Times newspaper, which is part of the group published by the Communist Party mouthpiece the People's Daily.
“This is the most serious riot since Vietnam reunited, and the most stunning attack and looting foreign businesses in East Asia in recent years. Street politics in some Asian countries in recent years have caused havoc for social order and business, but few were like that in Vietnam, which deliberately targeted industrial parks and factories. Workers even ransacked their own factories,” it said.
“The rising turmoil in Vietnam has jeopardised the interests of foreign investors. Vietnam is probably no longer a rich land for investment and business, but a pariah in the eyes of these investors, especially East Asian investors. Vietnam is making a fool of itself, showing how uncertain its market is,” it said.
