Vietnam has a population of over 92 million people and its main trade partners are the United States, Japan, China, Australia and Singapore. It has a GDP of $141.67 billion and labor rates that are among the cheapest in the world at $0.39 per hour. The distribution network in Vietnam is comprised of state-owned, private, and independent entities but it is difficult to establish nationwide distribution due to a lack of infrastructure and cultural/economic differences across regions. The communication infrastructure is also expanding, especially mobile networks, but rural areas still lack access.

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. 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. 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. 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.
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