The amazing story of Samsung’s achievements in Vietnam exclusively highlights the significant role and remarkable contributions of Shim Won Hwan, president of Samsung Electronics Vietnam Complex. He shared with VIR’s Nguyen Duc the story of his 10-year journey to raise Samsung Vietnam to a world-leading position in the corporation’s global system.

As the first president of Samsung Electronics Vietnam Complex, it is absolutely reasonable to honour you as one of the leaders paving the way for the corporation’s development over the past 10 years in this country. Looking back on Samsung’s path to success in Vietnam, are you satisfied with what you and the corporation have accomplished for the country so far?

Looking back at the beginning of the journey, in 2008 when Samsung started to invest heavily in Vietnam, we can confidently say that we have obtained numerous important achievements, despite a large number of difficulties. Considering the scale of investment capital, production value, turnover, export turnover or labour recruitment, statistics are have increased multiple times compared with the starting point.

The most noteworthy point, however, is probably that Samsung as a global business has invested heavily in Vietnam, reaped tremendous successes, and become an example of success for the whole world. Since then, a lot of foreign companies, including Korean enterprises, have followed in the corporation’s footsteps and poured millions of dollars into the Vietnamese market.

By increasing their investment in the country, Samsung and other foreign direct investment (FDI) enterprises have contributed significantly to socioeconomic development, particularly the growth of exports.

Last year, Vietnam’s export-import revenue exceeded $400 billion, with the value of exports surpassing $200 billion. Samsung, with an export turnover of $54.4 billion, has contributed a quarter of the total gains.

Accordingly, Vietnam’s foreign exchange reserves have been steadily increasing. Thus, the stability of the exchange rate could be effectively maintained. This might be considered a solid foundation for socioeconomic development and Samsung is proud to have contributed to the establishment of such important premises for development.

Samsung’s contributions to the socioeconomic development of Vietnam are undeniable. However, some still say that Samsung has been given too many incentives, while the corporation has not contributed adequately to overall growth. Does this upset you? In the past ten years, what has Samsung done to overcome these prejudices?

During the course of our investing and doing business in Vietnam, we have received a great deal of support from the government and the people of Vietnam. We highly appreciate this support, though I accept the fact that there are still a lot of negative comments about Samsung.

However, all of the preferential treatments lie within the Vietnamese legal framework. Samsung is investing heavily in the high-tech sector where the government of Vietnam is enthusiastically calling for more investment and thus we are able to enjoy the highest level of policy incentives.

Perhaps, the rapid development of Samsung Vietnam has made people mistakenly believe that we were granted more preferential treatment to achieve such tremendous progress. In fact, we receive no more, no less than any other businesses, including domestic enterprises that invest in the same fields.

A crucial factor is our Vietnamese employee base. For any business, the most precious resource is undoubtedly the workforce. For Samsung, they are not just wage earners, but also members of our extensive family. In the development path that we have been following, they have always been planning for a future in the next 10 - 20 years. To realise these goals, they actively contribute to the corporation and support us on the road to success.

The investment scale of Samsung Group in Vietnam

Another important factor is that Samsung has always kept pace with world trends and has always made prompt, strong, and timely moves to adapt to changes. When we first invested in Vietnam, basic mobile phones dominated the global mobile market, occupying nearly 90 per cent of the market. What lies behind the success of Samsung Vietnam?

Yet, after ten years, the situation has changed and now we are in the era of smart phones. We succeeded because we managed to actively ride that trend as well as the development of the global mobile device market.

In order to catch up with market trends, we have also accelerated the training of human resources. The Vietnamese labour force is very intelligent in general and they are fast learners. Additionally, we quickly proceeded to expand the scale of the plant. This has helped Samsung Vietnam achieve strong development in recent years and become Samsung's largest manufacturing base in the world.

Samsung is growing at an amazing pace, but what will happen in the next 10-20 years? Could you share Samsung’s upcoming investment plans in Vietnam?

As part of our company’s culture, we have always reminded employees to think about how our business might change in the next 10, 20 or even 30 years. However, it is in fact very difficult to predict the growth prospects for the next 10 years like how the plants will be organised or what products will be made. Still, a regular habit of planning for future directions ensures better preparation for the changes of the world.

Regarding new investment plans, as you know, during the past ten years, we have focused on developing and manufacturing electronic products as well as accessories and spare parts in Vietnam.

We also committed to invest more than $17.3 billion in the country and so far have disbursed the majority of this. That is to say, we have kept our promises to the government of Vietnam. Most likely, it would be hard if not impossible to find any other enterprise that can proceed such a large disbursement in a very short time.

Given the scale of our investment at the moment, it is still a bit early to talk about another large-scale investment project because we need to enhance our credibility as well as maintain trust for the corporation. Later on, if more investment projects come up, we will keep our promises, as always.

As you have said, Samsung has achieved great successes and fulfilled its promises to Vietnam. However, what we are looking forward to is, perhaps, the corporation’s commitment to accompany and support Vietnamese businesses in the course of development. There have always been many opinions saying that the link between FDI and domestic enterprises is not tight enough. Do you have any plans in this direction?

It is true that there are opinions to this effect, but I believe that the connection between Samsung and Vietnamese enterprises is not loose, even though this is just the beginning.

We have been in Vietnam for ten years. However, the first five years were all about setting the foundations and establishing factory complexes. The period of development, hence, only started about 4 - 5 years ago. In 2014, SEVT came into operation and from 2015 onwards, we have kicked off several activities to connect with Vietnamese enterprises and help them become Samsung’s exclusive suppliers.

Each business needs at least three-four years to stabilise its operations a task which is definitely not easy to carry out, not to mention the responsibility of supporting other businesses. However, during the past 3 - 4 years, we have done everything, from stabilising production activities to supporting Vietnamese enterprises. To date, this is something that no other enterprises in Vietnam have accomplished.

Besides, to strengthen the connection between Vietnamese enterprises and Samsung, our partners also need time to transform themselves. So, we are still at the starting point. It is important to successfully connect the initiatives of Vietnamese enterprises, the support of the government, and the efforts of Samsung.

At present, in order to promote and generate more spill-over effects in supporting Vietnamese enterprises, starting from this year, we have been coordinating with Vietnamese government agencies to undertake training programmes for Vietnamese consultants to improve their skills and expertise.

The last question is a bit more personal. After your term of office from 2010 to 2014, you returned to South Korea to take on new duties. However, after only two years, you suddenly returned to Vietnam at the middle of last year to reassume your old position as the head of Samsung’s manufacturing complexes in the country. This is unprecedented in the history of Samsung. Can you share the reasons behind your return?

I was one of the people who have been with Samsung Electronics Vietnam Complex since the very beginning. That is why I have tremendous passion for Vietnam and Samsung Vietnam. I especially love my staff, to the point where I had to come to rural areas to recruit workers, bring them to the factory, train them as official employees, and witness their efforts on the road to success. Now, I feel very happy seeing them succeed.

I have taken care of every plant in the factory, each room in the dormitory, even every device in the cafeteria. When talking about Samsung Vietnam, there cannot be a greater love for them than mine. I really missed them when I went back to Korea.

At the meetings in Korea, probably because I talked too much about Vietnam and the factory, as well as my employees, the leaders said that if you loved Vietnam that much, you should return and continue the work. And I came back. I was very excited and touched on that day. I will, together with the management board of Samsung Vietnam, always try my best to contribute to the socioeconomic development of Vietnam and maintain the world-leading position of Samsung Vietnam on a global scale.

I also hope that Samsung will receive more love from the people of Vietnam, even to the point that when a person buys a Samsung product, he will be proud that this is a product of Vietnam and happily use it.

Shim Won Hwan was born in 1959 and has been working for over 34 years at Samsung Electronics since graduating from Kyungpook National University. He has undertaken a number of important positions at Samsung Electronics, particularly in the Human Resources and Management fields, including the position of general manager of the Gumi Plant (Korea) since 2015. He was president of Samsung Vietnam in 2010 - 2014, then returned to Korea before returning to Vietnam in June 2017 and reassuming his old position as president of Samsung Electronics Vietnam Complex.