The German Supply Chains Act and the EU's CSDDD: Catalyst or Brake?
by
Marina von Borstel,
Florian C. Feyerabend
An analysis of the implementation and impact of the LkSG and the CSDDD on the Vietnamese economy
Since the beginning of the “China+1” policy, Vietnam has played a key role in the ASEAN region. Vietnam, which has enjoyed unparalleled economic growth of an average of 6-8% for three decades, is particularly interesting for foreign direct investment. German companies want to invest in the with the objective of diversification. Since January 2023 at the latest, with the introduction of the German Supply Chain Due Diligence Act (LkSG) and now the most recent EU Corporate Sustainability Due Diligence Directive (CSDDD), it is no longer just the economic attractiveness of a country that matters. Rather, binding commitments to compliance with human rights, social standards and environmental protection play a central role for companies. Can the Vietnamese economy meet these requirements?
