Deep C Brochure Electronic-draft

FUTURE TURNKEY

Ref: Electronics_Brochure_rev00_202005_EN

HAIPHONG OFFICE

5th floor, Harbour View Office Tower, 12 Tran PhuNgo Quyen, Haiphong

Tel: +84 225 3836 169Email: [email protected] – Website: www.deepc.vn

QUANG NINH OFFICE

No. 8-9 My Gia Street, Vinhomes Dragon BayHa Long residential area, Hong Gai ward,Ha Long city, Quang Ninh province

Tel: +84 2033 567 848

ELECTRONICSMANUFACTURINGCENTER IN VIETNAM

VIETNAMAN INTEGRATED ECONOMY WITHLOW COST AND LARGE LABOR FORCEVietnam’s economy driven by these macro-economic conditions

Competitive labor cost makes Vietnam an attractive alternative

A large young labor force

The third-largest population in ASEANwith 96.48 million people ranked 15thglobally.

Vietnam’s high and stable GDP growthrate per Capita (USD).

Rapid improvements in connectivity bymajor infrastructure projects.

Increasing middle and affluent class.

Vietnamese Government support.

Vietnam GDP per Capita (USD).

100

120

140

160

180

200

220

240

260

280

2010 2012 2014 2016 2018 2020

115.93

135.54

155.82

171.22

186.2193.24

205.28

223.78

245.21

255

Manufacturing labor cost per hour of China, Vietnam, Mexico from 2016 to 2020 (USD).

10% 8% 6% 4% 2% 2% 4% 6% 8% 10%0%

0-4 4.3 3.9

5-9 4.1 3.7

3.8

3.5

3.8

4.6

4.4

4.0

3.6

3.3 3.3

3.0 3.0

2.6 2.8

2.0 2.3

1.3

0.6

0.4

0.3

0.2

0.1

0.0

0.0 0.0

0.1

0.2

0.4

0.6

0.7

1.0

1.6

3.6

3.4

3.2

3.6

4.4

4.3

3.9

10-14

15-19

20-24

25-29

30-34

35-39

40-44

45-49

50-54

55-59

60-64

65-69

70-74

75-79

80-84

85-89

90-94

95-99

100+ Vietnam’s population (96,462,108) pyramid by age, 2019.

Male Female

0

2

4

6

8

China Mexico Vietnam

4.99

3.82

2.38

5.21

4.16

2.55

5.51

4.45

2.73

5.78

4.66

2.91

6.5

4.82

2.99

Co

sts

per

ho

ur in

U.S

. do

llars

.

2016 2017 2018 2019 2020

ELECTRONICS INDUSTRY IN VIETNAM

The electronics industry plays a crucial role in the vibrant Vietnam economy, accounting for 14 % of GDPin 2017, up from a mere 5.2% in 2010.

Vietnam Electronics Industry 2000-2016.

200500

1,000

1,500

400

600

800

2000 2005 2010 2015 2016

113256

613

1,1451,237

No.

com

pan

ies

1,00

0 p

eop

le

No. of companies Employment

1,237 companies

612,000 people

28.9 % of total Export

14% of GDP

Main Electronic clusters location in KEZs in Vietnam, 2015.

LANDSCAPE IN VIETNAMNORTHERN, SOUTHERN, AND CENTRAL INDUSTRIAL HUBThe Vietnamese government divides the country into three key economic zones (KEZs)

Main Electroniccluster locations

Vietnam Electronics FDI and Export

Vietnam Electronics key playersand export by category

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Vietnam Electronics FDI and Export value.

The supply of electronic components and supporting products start to be produced in Vietnamin recent years by FDI companies.

Global MNCs like Samsung, LG, and Intel are the industry drivers.

Vietnam ranks #2 globally in mobile phone exports.

Global Lead FirmsSamsung, LG, Canon, Panasonic

Contract ManufacturersFoxconn, Compal, Jabil Circuit

Platform leaders Intel

Domestic enterprises participation is very low.

FDI generates 95% of Vietnam electronics export turnover.

Communicationequipment50.14%

Electroniccomponents12.90%

Industrialassemblies0.22%

Industrialfinal products0.15%

Customerelectronics7.84%

Computerequipment10.38%

Subassemblies18.37%

Share of Vietnam Electronic categories export, 2016.

In the South, the main location is the Saigon High Tech Parkin HCMC that hosts Intel, Samsung, Nidec, and Jabil,followed by Binh Duong province.The southern region only accounts for 10 of the 75largest projects.

The Northern Key Economic Zone

The Central Key Economic Zone

The Southern Key Economic Zone

Hoang SaParacels

Truong SaParacels

Thai Nguyen Province

Bac Ninh Province

Haiphong

Hung Yen Province

Vinh Phuc Province

Ha Noi

Binh Duong ProvinceHo Chi Minh City

Northern provinces(Hai Phong, Thai Nguyen and Bac Ninh) have receivedthe largest investment capital (Samsung and LG).They are the center of the cluster with over 137 companies(each project is larger than US$ 1 million).

Logistics

Incentiveprograms

Investmentcost

Supportiveindustry

Powersupply

Labor force

Governmentalsupport

Environmental

Each region of Vietnam has its own competitive advantages which are based on the differencesin the trading nature and available land bank.

0

2

4

6

8

10

North

South

Center

Geographic distribution of the Electronics value chain

Hoang SaParacels

Truong SaParacels

Cao Bang

Ha Giang

Lao CaiLai Chau

Dien Bien

Son La

Hoa Binh

Ha Nam Thai Binh

Nam DinhNinh Binh

Thanh Hoa

Nghe An

Ha Tinh

Quang Binh

Quang Tri

Thua Thien Hue

Quang Nam

Quang Ngai

Kon Tum

Binh Dinh

Gia Lai

Dak Lak

Khanh Hoa

Ninh ThuanLam Dong

Dak Nong

Binh Thuan

Binh Phuoc

Dong Nai

Ba RiaVung Tau

Ho Chi MinhLong An

Dong ThapAn Giang

Kien Giang

Can ThoVinh Long

Tra Vinh

Ben Tre

Soc Trang

Hau Giang

Bac Lieu

Ca Mau

Tien Giang

Tay Ninh

Binh Duong

Phu Yen

DaNang

HaiDuong

HaiPhong

HungYen

Ha Noi

BacNinh

Yen Bai

Phu ThoVinhPhuc

TuyenQuang

Bac Kan

Lang Son

Thai Nguyen

Bac Giang

Quang Ninh

LQ Final Product

LQ EE Components

Top 10 Electronic firms(income)

10,000,000

100,000,000

1.1 - 2.02.1 - 5.05.1 - 10.010.1 - 15.0

1.4 - 2.02.1 - 5.05.1 - 10.010.1 - 16.5

LQ: Location Quotient

Top 10 Electronic firms by income (USD/year).Detailed Rating 0-10 (10 best score) of Key Economic Zonesin Vietnam.

Electronics sector is highly concentratedin the northern provinces.

Among the ten biggestcompanies in terms of revenue,most are located in the North.

Location Quotient (LQ) reflects theeconomic concentration of electronicsindustry in each region.

A region with LQ >1 indicates the electronicsvalue-chain has a greater concentration thanaverage of national level.

NORTHERNINFRASTRUCTURE

Haiphong - Quang Ninh - Chinaborder Expressway

HANOIQUANG NINH

HAIPHONGCoastal Expressway

Cai Lan Port

Cat BiInt’l Airport

Lach HuyenDeep Sea Port

DEEP CHaiphong

Van DonInt’l Airport

Hanoi - HaiphongExpressway

Lach Huyen Deep Sea Port 100,000DWT

Draft: -14m

# Cargos: 419,351 TEUs (2019)

# Cargos: est. 120 mil. tons (2030)

Operational: May 2018 (first 2 berths)

Haiphong Port 20,000DWT

Draft: -8.4m ~ -9m

# Cargos: 130 mil. tons (2019)

Cai Lan Port 40,000DWT

Draft: -10m

# Cargos: 74.3 mil. tons (2018)

Hanoi Noi Bai Int’l Airport

# Passengers: ~3.2 mil./year

Planned expansion: ~13 mil. passengers/year & 250,000 tons cargos/year

Quang Ninh Van Don Int’l Airport

Hanoi - Haiphong Expressway

105 km

Max speed: 120 km/hour

Haiphong - Quang Ninh - China border Expressway

25km from Haiphong to Ha Long with Bach Dang bridge

54km from Ha Long to Van Don completed

80km from Van Don to Mong Cai (border to China) to be completed in 2021

12 hours trucking Haiphong – Shenzhen (China) by 2021

Coastal Highway

550 km

Connecting 6 coastal provinces Quang Ninh - Thanh Hoa

Haiphong Cat Bi Int’l Aiport

# Passengers: est. 2.5 mil./year

# Cargos: est. 10,000 tons/year

New terminal, new runways

# Passengers: ~21 mil./year

# Cargos: 203,000 tons/year

Possibility of expansion: ~50 mil. passengers/year (2030)

DEEP CQuang Ninh

Noi Bai Int’l Airport

DEEP C Haiphong I541 ha

DEEP C Haiphong II645 ha

DEEP C Haiphong III520 ha

DEEP C Quang Ninh I487 ha

DEEP C Quang Ninh II

Ready-built workshop/warehouse/offices

1193 ha

DEEP CINDUSTRIAL ZONESSTRATEGIC LOCATIONAt the centre of North Vietnam’sinfrastructure developments

DEEP C Industrial Zones was first established in 1997 in Haiphong City with the development of Dinh Vu Industrial Zone (DVIZ/DEEP C Haiphong I), a collaboration between the Belgian group Rent-A-Port and Vietnamese local authority. Since then, we have evolved to be one of the largest industrial zone developers in Vietnam with a total of 5 industrial zones and +3,500ha of land for lease in Haiphong city & Quang Ninh province, supported by general infrastructures and reliable utilities.

Lach HuyenDeep Sea Port

Dinh Vu Port

Cat BiInt’l Airport

Hanoi - HaiphongExpressway

Haiphong - Quang Ninh - Chinaborder Expressway

12 trucking hours to Shenzhen

HaiphongCity Centre

R

R

R

R

Coastal Expressway

INDUSTRIAL LAND FOR LEASE

READY-BUILT WORKSHOP/ WAREHOUSE/ OFFICES

5,400m2 | 4,050m2 | 2,700m2 | 1,350m2Size of

2.5T/m2Floor loading capacity

+9mFree height

Built-to-suit options available

5,400m2 | 4,050m2 | 2,700m2 | 1,350m2Size of

2.5T/m2Floor loading capacity

+9mFree height

Built-to-suit options available

5,400m2 | 4,050m2 | 2,700m2 | 1,350m2Size of

2.5T/m2Floor loading capacity

+9mFree height

Built-to-suit options available

0% 5% 10% 20%

SUPPORTING SERVICES›

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Dedicated customer service team.

Support for Investment Registration Certificate and Business Registration Certificate applications.

Post-licensing services.

@ DEEP C HAIPHONG

ECONOMIC ZONE TAX INCENTIVE

4.35% Corporate Income Tax on average for the first 15 years.

Applied from the first commercial invoice.

Maximum delay of 3 years in case of no profit.

Normal Corporate Income Tax rate: 20%.

First 4 years 9 years 2 years Y16th onwards

Case 1: Making profit from 1st year of establishment

No Profit 0% 5% 20%3 years 4 years 8 years

10%1 year Y17th onwards

Case 2: Making profit from 4th year of establishment

RELIABLEUTILITIES AND SERVICES

TelecommunicationNetwork

Fire-fighting System

Water & Waste Water

Power

Park Management

Reliable incoming source (national grid & regional grid as backup).

Underground distribution.

Redundant network design.

Ongoing development of renewable energy.

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Redundant treated water supply.

Demineralized water and steam.

Central waste water. treatment plant certified with ISO 9001 & 14001.

Underground loop system.

Waste Collection Service

Redundant distribution networks. Flexibility to choose between different suppliers.

Energy Hub

Easy access to fuels and chemicals supply from tenants in DEEP C Hai Phong I’s Petrochemical Park.

Drainage

OUR LONG-TERM PARTNERS+120 investors from a wide variety of industries and nationalities.

Mr. Vu Anh Tuan

Supply Chain ManagerChevron Lubricants Vietnam Co., Ltd.

As the very first client coming to DEEP C, over 20 years we have witnessed the growth of DEEP C as well as the continuous improvement they have put in place, from reliable power supply to upgraded liquids jetty condition. This has contributed to our own growth, so we could start exporting in 2013 and expand our operation twice.

Mr. Akira Yamamoto

General DirectorNakashima Vietnam Co., Ltd.

We were operating in another industrial zone before, but we decided in 2008 to be the first Japanese runner in DEEP C because of three main reasons: location, expectation of the infrastructure development, and the tax incentives.