Vietnamese president confirms authorities are investigating the proposal after earlier talks stalled over ownership issues
26 September 2024 - 15:41
byKhanh Vu and Francesco Guarascio
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Elon Musk, Chief Executive Officer of SpaceX and Tesla. Picture: David Swanson
Hanoi — Elon Musk’s SpaceX plans to invest $1.5bn in Vietnam soon, the government said on Thursday, which could help resolve a stalemate over the launch of the Starlink satellite services there.
Months of talks on the offer of Starlink’s satellite internet connection and other communications services were put on hold at the end of 2023, sources familiar with the matter said earlier this year, though they resumed later.
“The Vietnamese government is considering the [investment] proposal of SpaceX,” a report on the government portal on Thursday quoted President To Lam as saying. Lam also asked the company to work closely on completing preparations for the investment.
The remarks came after Lam’s meeting in New York with SpaceX government affairs official Tim Hughes, who said the company planned to invest $15bn in Vietnam, a promising market for its satellite internet service, the report added.
The government did not clarify where SpaceX’s investment would be made, or when details could be agreed.
Neither US-based SpaceX nor Vietnam’s foreign ministry immediately responded to a request for comment.
With a population of 100-million, Vietnam is a big user base for US internet companies such as Meta’s Facebook and Alphabet, but its ageing equipment can disrupt operations of optic fibre undersea cables.
Swathes of mountains also make internet services less reliable in Vietnam, which could also use satellite internet for tasks such as tighter patrolling in the disputed South China Sea where it is often at odds with China.
Such a step may not go down well with Beijing, though.
Investing where?
Thursday’s news comes after a report this month on the government portal that cited Hughes as saying SpaceX aimed to provide Starlink services to the Southeast Asian nation, after the two sides had resumed talks.
At the time, Hughes, the company’s senior vice-president for global business and government affairs, said SpaceX’s deployment of internet services in Vietnam aimed mainly to benefit education and disaster prevention efforts, state media reported.
Last year’s talks were stymied by questions about the ownership of the company SpaceX would have to set up in Vietnam, which limits foreigners’ holdings in such firms to 50%, while SpaceX wanted at least a controlling stake, sources had said.
It is unclear whether that issue is still a hurdle.
Vietnam also requires data to be stored domestically, with strict controls on what is visible online.
Industry sources said SpaceX has suppliers in Vietnam, a major industrial hub home to large manufacturing operations of US firms and their contractors.
Apple, which has dozens of suppliers in the country, said in April it wanted to invest more by increasing spending on them.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Musk’s SpaceX plans $1.5bn Vietnam Starlink investment
Vietnamese president confirms authorities are investigating the proposal after earlier talks stalled over ownership issues
Hanoi — Elon Musk’s SpaceX plans to invest $1.5bn in Vietnam soon, the government said on Thursday, which could help resolve a stalemate over the launch of the Starlink satellite services there.
Months of talks on the offer of Starlink’s satellite internet connection and other communications services were put on hold at the end of 2023, sources familiar with the matter said earlier this year, though they resumed later.
“The Vietnamese government is considering the [investment] proposal of SpaceX,” a report on the government portal on Thursday quoted President To Lam as saying. Lam also asked the company to work closely on completing preparations for the investment.
The remarks came after Lam’s meeting in New York with SpaceX government affairs official Tim Hughes, who said the company planned to invest $15bn in Vietnam, a promising market for its satellite internet service, the report added.
The government did not clarify where SpaceX’s investment would be made, or when details could be agreed.
Neither US-based SpaceX nor Vietnam’s foreign ministry immediately responded to a request for comment.
With a population of 100-million, Vietnam is a big user base for US internet companies such as Meta’s Facebook and Alphabet, but its ageing equipment can disrupt operations of optic fibre undersea cables.
Swathes of mountains also make internet services less reliable in Vietnam, which could also use satellite internet for tasks such as tighter patrolling in the disputed South China Sea where it is often at odds with China.
Such a step may not go down well with Beijing, though.
Investing where?
Thursday’s news comes after a report this month on the government portal that cited Hughes as saying SpaceX aimed to provide Starlink services to the Southeast Asian nation, after the two sides had resumed talks.
At the time, Hughes, the company’s senior vice-president for global business and government affairs, said SpaceX’s deployment of internet services in Vietnam aimed mainly to benefit education and disaster prevention efforts, state media reported.
Last year’s talks were stymied by questions about the ownership of the company SpaceX would have to set up in Vietnam, which limits foreigners’ holdings in such firms to 50%, while SpaceX wanted at least a controlling stake, sources had said.
It is unclear whether that issue is still a hurdle.
Vietnam also requires data to be stored domestically, with strict controls on what is visible online.
Industry sources said SpaceX has suppliers in Vietnam, a major industrial hub home to large manufacturing operations of US firms and their contractors.
Apple, which has dozens of suppliers in the country, said in April it wanted to invest more by increasing spending on them.
Reuters
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.