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Vietnam Country Analysis and Consultation Fact Sheet


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Vietnam Country Analysis and Consultation Fact Sheet

  1. 1. Country Consultation Fact Sheet Vietnam Population 92,477,857 people (July 2013 est.) (Tuoi Tre News, 2013) Trade Blocks Vietnam, Brunei, Cambodia, Indonesia, Lao, Malaysia, Myanmar, Philippines, Singapore, and Thailand (ASEAN). Asia-Pacific Economic Cooperation (APEC). Trade Partners Main trade partners are United States, Japan, China, Australia and Singapore. (Association of Southeast Asian Nations; AsiaPacific Economic Cooperation, 2013) (Trading Economics) FDI Policies Investment Law 2005 states that the legitimate investment capital and assets of foreign investors will not be nationalized nor confiscated by administrative measures (except in absolutely necessary cases for reasons of national defense, security and interests). Vietnam will also protect intellectual property rights of investor, after making all financial obligation to the host country, foreign investor may remit abroad their lawfully owned profit, capital fund and assets. The law also encourages the diversification of investment beside FDI to merger and acquisition, capital contribution for share purchase, business investment and development. (INVENCO Vietnam International Law Firm, 2013) Labor Rates $0.39 per hour, ranked fifth cheapest rate in the world. GDP (PPP) 141.67 billion US dollars in 2012. 1,595.81 USD per capita. (Richest People in the World, 2013) (World bank. Vietnam. Data, 2013) Channels of distribution The distribution network in Vietnam is comprised of state-owned import-export companies, state-owned wholesalers, private wholesalers, independent distributors, retail outlets, and street stalls. These distribution channels have legal constraints, which restrict participation to Vietnamese entities. If foreign investors are required to import goods for a project, they must import through a Vietnamese channel. Furthermore, due to a lack of developed infrastructure and cultural and economic differences across the country, it is difficult to establish one network for nationwide distribution. (International Business Publications, 2013)
  2. 2. Separate networks for the North, South, and Central regions would be required for nationwide distribution. Protected Industries High protection, high tariffs, and prohibition have been in place in Vietnam to protect domestic industries and to benefit State Owned Enterprises. In general, agricultural products are more protected than non-agricultural products. Since joining the WTO in 2007, Vietnam significantly reduced its tariff rates for preferred countries; however, agricultural products including fresh produce, fresh and frozen meats, and non-agricultural materials and machinery still face higher than average tariffs. In particular, shelled walnuts, ketchup and tomato sauces, salt, tobacco, eggs, and sugar face high tariffs and quantitative restrictions. Items prohibited from importation include cigarettes and cigars, books and movies, precious metals and stones, pharmaceutical products, processed and crude oil, rice, cane and beet sugar; trade and sales of these items are restricted to domestic enterprises and prohibited from Foreign Invested Enterprises. Communication Vietnam’s communication infrastructure is expanding, Infrastructure driven primarily by the growth of mobile telecommunications and the expansion of broadband infrastructure. Usage of fixed line telephones has declined, standing at 11.5 lines per 100 inhabitants in 2011. In contrast, the mobile and broadband internet market is growing rapidly: “In 2012, the country’s largest telecom companies formed partnerships with other regional companies in a US$450 million international project to lay a 10,000-kilometre undersea Internet cable, which aims to improve Internet access speed in the region”. Wireless and mobile infrastructure serves both rural and urban areas of the country, with coverage of 70% of the population in 2010 using 2G and 3G networks. 4G networks are scheduled to be licensed and available in 2015, with the goal of improving mobile coverage to 90% of the population in 2015 and 95% in 2020. In 2011 there were 127 million mobile phone subscriptions with a growth rate of 14.1%, but consumers in rural areas are still underserved. However, the digital divide is shrinking with the decline in prices of mobile devices and subscriptions, in addition to the availability of technology, service, and infrastructure across the country. As of 2013, Vietnam has 2.74 million mobile (U.S. Commercial Service, 2011) (World Trade Organization, 2012) (U.S. Commercial Service, 2011) (Country Watch, 2013) (Euromonitor, 2013) (Country Watch, 2013) (Euromonitor, 2013)
  3. 3. phone users and 3.5 million internet users. (Country Watch, 2013) Transportation System Financing and implementation of roads is governed by multiple agencies and most improvement is driven by new construction rather than maintenance. 84% of the national roads are paved while only 45% of all roads are in good condition. Traffic is mainly concentrated on national roads and around major urban centers where the motorbike is the primary mode of transport followed by the bicycle. The bus is the cheapest and most convenient form of transportation fallowed by the railway system which compromises of 281 stations in connection with China. Managed by local governments and port authorities, inland waterways are 17% commercialized and good for high weight low value transportation. Driving a car is challenging and uncommon and only 3 out of 50 airports are international. (Vietnam Online, 2011) Healthcare The government is currently working to develop a universal healthcare system. The system is currently supported by a minimal percentage of the GDP and does (Truong, 2010) not require all citizens to be covered. The system faces disparities in access; sufficient healthcare is not readily available in rural areas. Local practices are not up to modern standards and lack quality. The average life expectancy is 72 and the child mortality rate has (InterNations, 2013). decreased significantly. Typhoid fever, dengue fever, and malaria are common. Education 97% of the population ages 15-24 is literate. Net (IRED, 2013) enrolment rates for primary education stand at 98% while completion rate for primary education stands at 93%. Lower secondary schools are available in every district where primary schools are not. Private language centers are in high demand because public school systems are underfunded. English as a second language is taught to students of all age groups while the number of schools and teachers has beensteadily increasing. Natural Environment Industrial sources and hazardous wastes are the main source of air and water pollution. Rapid population growth and intense agricultural development are a direct threat to biodiversity. Climate-related disasters and pressure from international organizations have increased the utilization of renewable energy and reduced the (NERN, 2010)
  4. 4. effects of green house gases. The mining industry has caused a reliance on the extraction of natural resources and made the economy more vulnerable fluctuations of the global economy. The industry created short-term jobs for poor unskilled migrant workers, causing market price to increase. Works Cited Asia-Pacific Economic Cooperation. Accessed Oct 24, 2013 Association of Southeast Asian Nations. ASEAN Member States. Accessed October 28, 2013. Expatriate Community for Expats worldwide | "Healthcare in Vietnam |" Accessed October 28, 2013. INVENCO Vietnam International Law Firm. Accessed October 23, 2013. Ministry of Natural Resources and Environment Vietnam(NERN). "The social impact of mining activities." Last modified 2010. BJPP129087. Organization for Economic Co-operation and Development. Accessed October 24, 2013. Richest People in the World. Countries with the Cheapest Labor. Accessed October 23, 2013. Trading Economics. Vietnam exports. Accessed Oct 24, 2013 "Technology, Communications and Media: Vietnam." Global Market Research and Analysis for Industries, Countries, and Consumers. Accessed October 30, 2013. The social impact of mining activities. Accessed October 24, 2013. BJPP129087
  5. 5. Truong, Kimberly. "Vietnam’s Socialist Healthcare System · Vietnam Talking Points." Vietnam Talking Points. Last modified October 10, 2010. Tuoi Tre News. Vietnam society. Access October 24, 2013 ViệnNghiênCứuPhátTriểnGiáoDục (IRED). "Overview on Vietnam's Education System Education In Vietnam." Accessed October 24, 2013. Vietnam. Data. Accessed October 23, 2013. Vietnam: doing business and investing in Vietnam guide. 8th ed. Washington, D.C.: International Business Publications, USA.Accessed October 23, 2013. Vietnam National Report 2013. United Nations, 2013. Accessed October 24, 2013. Vietnam Online - Promoting Vietnam tourism, trade and investment since 1997. "Vietnam Transportation - Vietnam Public Transport." Last modified 2011. Vietnam Travel & Living Guide - Promoting Vietnam tourism, trade and investment since 1997. "Vietnam Transportation - Vietnam Public Transport." Last modified 2011. World Trade Organization. (2012). Tariffs and imports: Summary and duty ranges [Data file]. Accessed October 30, 2013 WTO. World Trade Organization.Accessed October 23, 2013.