Nokia plans to invest €200 million (US$276.3 million) in a new mobile phone manufacturing site near Hanoi in northern Vietnam along "with further, sizeable investments thereafter," the company said Wednesday.
Nokia chose Vietnam due to its location and developing infrastructure, the company said in a statement. In addition, the nation is a good market for Nokia mobile phones, which it started selling there in 1996.
"The new manufacturing site is being established to meet the growth in demand for these phones, as well as help Nokia to deliver a contemporary mobile experience to the next billion consumers all over the world," Nokia said.
The first factory in Vietnam will open in 2012, Nokia said. The company currently supports ten major facilities around the world, including in Brazil, Romania, India, China and the U.K.
The world's largest mobile phone vendor estimates that while 90 percent of the world's population lives within range of a mobile phone signal, 3.2 billion people still do not own a handset. Of the 3.7 billion people who do own a mobile phone, Nokia reckons that fewer than half of them use their handset to access the Internet. The trends provide Nokia with the opportunity to sell more handsets overall and more advanced phones that can connect to the Internet.
Vietnam has attracted more and more investment, particularly in the technology sector, over the past several years and in particular as labor and other costs in China rise. A number of companies, including chip giant Intel as well as Taiwanese manufacturers such as laptop maker Compal Electronics, have invested in Vietnam.
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