Vietnamese government has made ceaseless efforts to open and integrate its economy into the global economy. After officially becoming a member of the World Trade Organization (WTO), Vietnam has participated in many international cooperative agreements including various free trade agreements (FTA) with many regional and global partners. Especially, Vietnam is actively negotiating the Trans-Pacific Partnership agreement (TPP) which promises to open up Vietnam’s market even further to investors.
As a result, Vietnam export turnover continued to increase with the growth rates averaging 23.12%/ year over the period of 2010-2013. Export turnover increased mainly in the foreign-invested sector for such products as electronic appliances, computers and components, telephones and accessories, textiles, footwear... Regarding markets, the European countries, the United States, ASEAN countries, Japan, South Korea and China are the largest export markets of Vietnam. Import turnover reached USD 131.3 billion in 2013, up 15.4% compared to 2012. The foreign-invested sector accounted for the biggest proportion of the total import turnover. China is the largest import market of Vietnam, followed by ASEAN countries, South Korea, Japan, the EU and the United States. Increasing import – export activities showed that Vietnam's economy had recovered from the recent global economic recession and companies felt confident to expand their operation and were willing to grasp new opportunities.
In 1986, Vietnamese government implemented a comprehensive reform program known as “Doi Moi” which forever abandoned the hard-reform-socialism approach and radically dismantled central planning, liberalizing trade, promoting private sectors, and constructing a socialist-oriented multi-component economy. Since then, Vietnamese government has remarkably improved its legal framework and institution to create a transparent and fair investment environment for investors. In 2015, a number of amended laws such as Law on Investment, Law on Enterprises, Law on Land, and Residential Law will take effect, assuring to help foreign investors to overcome bureaucratic bottlenecks and create an equal legal system to attract high-quality investment projects. Besides, Vietnamese government also strives to restructure its economy and reform economic growth model to promote innovation and strengthen the country’s competitiveness. According to the Global Competitiveness Report 2014-2015 by World Economic Forum (WEF), Vietnam ranked 68, up 2 ranks compared with 2013-2014.
Vietnam currently has a golden age structure with more than 50% of people of working age and more than one third of its population residing in urban areas. The average labor productivity for Vietnamese workers has risen steadily from 2005 – 2014, averaging 3.7%/year over that period, narrowing the gap between the country’s labor productivity and the top performers’ in the region. The rapidly rising demand for trained labor to meet up with economic development tendencies has motivated Vietnam to renovate its labor force and increase the share of skilled labors. Vietnam now thrives on its workforce’s dexterousness, diligence, strict discipline, a can-do attitude, and strong work ethics. Vietnamese labor force offers a winning combination of the abundance of low-cost general labors and the wide availability of highly competent talented individuals who master the knowledge of Western/Asian business culture and are eager to join the global force.
High-quality infrastructure is the most important factor enabling efficient business operation and reducing transactional costs. Vietnam’s infrastructure has been persistently upgraded to provide the best condition to businesses to invest in the country.
+ Global and domestic connectivity
The transportation infrastructure system in Vietnam consists of roads and highways, railways, ports, harbors and airports. At present, Vietnam has 21 commercial airports and 10 of them are international airports with modern facilities and equipment, connecting Vietnam with 41 destinations around the world including ASEAN countries, China, Japan, South Korean, the United States, France, Germany, and Australia. To travel to other countries in the region such as China, Cambodia, Laos and so on, business travelers can easily choose other means of transportation such as cars, buses and trains. The national road system is completed and advanced making it possible to travel to everywhere in the country. In big cities, public transportation, taxis, and “xe om” (motorbike-taxi) are widely available and reasonably priced, catering to the needs of all local people, tourists, and business travelers.
With its deep-water seaports and a commercial history, Vietnam has also long been an international logistics and shipping hub. In 2014, the total cargo throughputs handled by Saigon Port reached 109 million tons, while that number for Hai Phong Port was over 55 million tons.
+ State-of-art communications
The system of post and telecommunication in Vietnam is of international standard, providing fast, reliable and high quality services such as ADSL, rapid data transfer, wide broadband MAN. The Internet service in Vietnam is also among the cheapest in the world.
+ Rapidly increasing industrial zones, economic zones and hi-tech parks
Vietnam has around 256 industrial parks and 20 economic zones across all the cities and provinces, and 03 hi-tech parks in Hanoi, Ho Chi Minh City and Danang City. When investing in the industrial zones and export processing zones, businesses can benefit from various incentives policy such as lower tax rates and other investment supporting services.
Reader Comments