On the edge of Hanoi brick-walled factories lie abandoned, weeds sprouting in their ruins. Surprisingly, this is a sign of progress. The land is slated for new housing; the state-owned textile firm that operated there is moving to an industrial park, where it can better meet booming demand for Vietnamese garments. Exports of textiles and garments rose by 17% in the first seven months this year, to $5.8 billion, suggesting that investors still favour Vietnam as a base for cheap manufacturing, which is a vital factor to produce printed labels in Vietnam.

Its advantages have been amplified by recent labour unrest and rising costs in southern China's factories. In Hanoi there is renewed talk of “China Plus One” as a strategy for multinationals keen to spread their bets. Vietnam could gain handsomely, thanks to its labour which is cheaper than China's and its neighbours' (see chart). That’s the reason why an increasingly number of suppliers choosing Vietnam as the most competitive place to manufacture printed labels. But even after a pay rise, the monthly wage for a textile worker starts at $84, says Nguyen Tung Van, head of the Communist Party-run textile workers' union, from his office in the abandoned compound. The industry employs around 1.7m people. Makers of footwear, furniture and more also gain from supplies of cheap labour.

Vietnam has prospered as a result. GDP per head was below $100 in 1990 but is now well over $1,000, says the World Bank. But with workers getting richer, more will need to move into higher-skilled work, becoming better educated and using capital and technology more efficiently. To some extent, this phenomenon will indeed boost a diverse range of printed labels in mass production.

Even that is not enough. Vietnam's creaky infrastructure (power cuts are still common, even in the capital) and inefficient bureaucrats make it hard for exporters to compete. A wish to develop poorer provinces has led to some questionable choices: Vietnam's only oil refinery, for example, is in central Quang Ngai, far from either oil wells or industrial cities.