IFC Investment to Boost Viet Nam’s Electrical and Electronics Industry, Creating Jobs and Strengthening Local Supply Chains

Hanoi, Viet Nam, September 24, 2025—To create better jobs and strengthen local supply chains, IFC is investing $200 million in LG Innotek Vietnam Hai Phong Co., Ltd. (LGITVH), a subsidiary of Korea-based LG Innotek Co., Ltd., a leading electronic components manufacturer. The loan aims to increase Viet Nam’s competitiveness in the global market by supporting the country in moving up the value chain and fostering higher-value exports.

LGITVH, operating two factories in Hai Phong with over 5,000 employees, is set to expand its production capacity for smartphone camera modules by building a third factory with IFC’s financing. This project will transform LGITVH’s operations into a comprehensive manufacturing complex, enhance collaboration with local suppliers to meet global standards, and boost domestic value addition while cultivating a highly skilled workforce. As Viet Nam’s electrical and electronics industry—accounting for 40 percent of exports and employing over 900,000 people—faces challenges like reliance on imported components, primarily for final assembly, and limited domestic value addition, this initiative will support efforts to diversify product mix, localize inputs, and adopt complex manufacturing processes, strengthening the industry’s resilience and competitiveness.

“IFC’s loan will help enhance LG Innotek’s global business competitiveness as well as improve LGITVH’s production capacity and quality,” said Ji-hwan Park, Chief Finance Officer and Senior Vice President of LG Innotek. “This partnership is expected to be a major step in advancing LG Innotek’s environmental, social and governance (ESG) management level. In particular, by leveraging IFC’s global network and expertise, we aim to expand ESG-compliant manufacturing capabilities and strengthen our position in the global market.”

The project is expected to create significant new direct and indirect employment opportunities across LGITVH’s value chain, including logistics, transportation, packaging, and other related sectors.

Structured as a sustainability-linked loan (SLL), this financing will incentivize LG Innotek to cut greenhouse gas emissions as outlined in its sustainability roadmap. IFC will also help LGITVH develop and implement its SLL framework. LG Innotek aims to achieve 100 percent renewable electricity across all its sites by 2030 and attain carbon neutrality by 2040. For Viet Nam, one of the countries most vulnerable to climate change, innovative financial tools such as SLLs are crucial for supporting sustainable development and climate goals.

"Backed by IFC, the expansion of a leading Korean high-tech electronics producer is poised to transform Viet Nam's manufacturing sector," said Carsten Mueller, IFC Regional Industry Director, Manufacturing, Agribusiness & Services, Asia and the Pacific. “This investment will fuel economic growth, create skilled jobs, and enhance value addition and production complexity in the E&E industry, boosting its global standing. Our sustainability-linked loan aims to have a catalytic effect, attracting more lenders and manufacturers, fostering greener supply chains, and cultivating a workforce uniquely equipped to position Viet Nam as a hub for sustainable, high-value production.

IFC remains committed to providing tailor-made solutions to support our Asian partners, including LG Innotek, in achieving sustainable growth in emerging markets.” 

IFC's partnership with LG Group began in the 1970s with an investment in LG Electronics Inc. (formerly known as Goldstar), when Korea was still an aid-recipient country. Since then, IFC has collaborated with various LG Group entities on projects across emerging markets.