The France, Taiwan Phone Companies Invest in Vietnam to Take Advantage of TPP?

The information that Vietnam has finished the TPP negotiation pushing many phone manufacturing companies like Archos (France), Compal (Taiwan) to promote their market expansion plan and investment in through setting up business in Vietnam.

The Archos phone company (France) and their distributor – Petrosetco (Vietnam) are recently launching 7 product lines in Vietnam market.

Mr. Frederic Balay – Senior Vice President and CEO in charge of North American of Archos has opined that Vietnam is large market which phone demand is constantly increasing every year. Along with that, while Vietnam is an official member of the TPP, the market will be extended to billions of people and 40% of global GDP, attractive offers on tariffs for intra-origin goods.

Mr. Frederic Balay also said that these product lines are designed by a team of engineers in France and factories in China of Archos are undertaking production. But he revealed that the company is making long-term plans in Vietnam market.

At the end of September, a major phone producer – Compal (Taiwan) also confirmed their decision to return to Vinh Phuc to continue investing in the plan to produce smart phone which was left unfinished at the end of 2007.

Mr. Vincent Lee, Deputy General Director of Compal factory in Vietnam said that in two recent months, Compal has urgently repaired factory system; installed equipment, machinery; worked with a number of localities inside and outside of the province for employment and preparing to welcome the world’s top customers to visit exploring opportunities for investment and cooperation in smart phone manufacturer in Vinh Phuc.

Vinh Phuc leader suggested that Compal should shorten the negotiation with partners, and soon to announce the list of products to be produced, as the basis from now until the end of 2015.  The province can adjust the investment certificate has signed and complete the procedures, mechanisms and policies to support the project in accordance with the law of Vietnam.

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Foreign Specialists Interested in Vietnam

Vietnam is attracting foreign specialists to visit, live and work as expatriates due to stable political, improved environment for doing business.

As such, Vietnam has becoming an attractive destination for setting up business and factory in comparison with other countries in the region due to the capability to attract managements and talents.

Vietnam topped the list as the country bringing high income for foreign professionals with 67% said that their income has increased and 68% of them have capable of increasing accumulation. The study was published by HSBC in the foreign expert research which was newly implemented.

Accordingly, foreign professionals living in Asia Pacific was the highest paid people in the world with an average annual income of 126,537 USD.

The report also shows that Asia Pacific is the workplace of 18% foreign experts with salary exceeding 200,000 USD a year, the highest rate in the region, followed by the Middle East with 16%.

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Benefits of Setting up Business in Hanoi

Benefits of Setting up Business in Da Nang

Benefits of Setting up Business in Ho Chi Minh City

Assistance in Setting up Business in Vietnam

M&A Services in Vietnam

Living in Vietnam: Earning more money and good accumulation

In Asia in general, Vietnam, China, Hong Kong, Malaysia and Singapore bring the highest accumulation to foreign experts, thus making their disposable incomes rise.

In particular, Vietnam topped the list with 67% of professionals working here saw their incomes rise and 68% have increasing accumulation. In particular, 16% of experts said that they potentially own more real estate by the rotation.

However, according to HSBC then Vietnam topped the area in terms of potential savings of foreign experts.

For younger professionals, a few Asian markets provide opportunities for better accommodation. More than half of professionals under 35 years old in Indonesia (55%) and India (52%) spend less on accommodation than when they stay in their own country.

The report also shows that Asia Pacific has the ability to create easiest financial base for professionals with high incomes, with 73% (of all income levels) said that they can establish easiest finance in New Zealand, followed by Singapore (63%) and Australia (56%).

Justin Bull from HSBC in Hong Kong said that Asia given the best opportunities for financing, allowing foreign experts to improve living standards and achieve desired lifestyle. The majority of the experts here are British and American. According to the survey, an important part of Asian experts changing local for income increasing like Australian experts working in China and Vietnam; Indian professionals working in Malaysia and Indonesia; Filipino professionals working in Malaysia and the Malaysian and Indonesian professionals working in Singapore.

There will be high-quality workforce shifting

When ASEAN is closer to the establishment of an economic community, the demand for skilled manpower will be increased to be able to enhance the competitiveness of the sector.

With the fact that ASEAN will increase 57 million new households belonging to the middle class to the global markets as of 2025, HSBC said that experts will continue to contribute in the field of telecommunication, technology, banking , education, hospitality, health, marketing and construction…

In addition, the new agreements on trade and investment, connecting economies with each other will unfreeze international vacancies between Asia and developing markets. This will be a potential world for skilled professionals and skilled labor.

The ability to save more, the higher disposable income or the ability to buy real estate is important factors for experts to consider switching to a new country.

Feel “Breathe easy” when living in Vietnam

Vietnam ranked 21st in the economic ranking, but ranked 5th when talking about the saving ability of foreign experts.

According to the survey from HSBC. Most of foreign experts believe that Vietnam had a more comfortable life with less spending on housing costs (62%), travel (73%), clothing (68%), goods and necessities (62%), essential services like electricity, water, telephone (70%) and bills (77%).

Thus, experts are likely to save more (68%) while living in Vietnam.

More than half of the foreign experts (62%) said that in Vietnam they can afford to hire a maid and nanny, something that they cannot afford while living at home country, and can enjoy the luxury vacation (52%), compared with only 28% and 36% of global experts.

The survey from HSBC also showed that Vietnam ranked 22nd in the ranking on experience, but 2nd in the ability to make friends. More than half of the foreign experts (56%) find that they integrate quickly into life and culture of Vietnam, and the majority of foreign experts find it easy to make new friends in Vietnam (68%).

Stabilize the life in Vietnam is relatively easy, with 36% of the experts feel like home once or within six months after moving to Vietnam. Most of foreign experts also enjoy integrated into in Vietnam (61%), enjoy and cook Vietnamese foods (78%).

Vietnam ranked 31st in the ranking about family. Almost half of the foreign experts (43%) said that the cost of child care in Vietnam is less expensive than at home country, and most of foreign experts (74%) send their children to the international school.

Vietnam is developing very fast and owns a dynamic business environment. This is an attractive destination for entrepreneurs seeking start-up opportunity and new business projects.

As an emerging market, Vietnam brings foreign experts many challenges and chances to develop career. With significant attractions in terms of tourism, culture and people, Vietnam also brings foreign experts wonderful experiences along with ease of integration and stabilizes the life in Vietnam.

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Vietnam Prepares for Wave of Russian Tourist

Vietnam is preparing to welcome waves of Russian to enter Vietnam tourism market, set up tour operator company and also conduct M&A activity in tourism industry.

Currently, there were complicated situations occurred in the favorite destinations of Russian tourists such as Egypt, Turkey and Goa of India, the Russian Government recommend, forbid or even stop the tours and flights to these destinations. Vietnam, Cuba and China have been recommended as safe destinations for Russian citizens to travel.

The A321 of Kogalymavia Airlines (Russia) had an accident in the Sinai Peninsula (Egypt) on October 31st killed 224 people on the flight. The Security Agency of the Russian Federation determined that this is a terrorist attack after finding traces of explosives in the debris. Soon after, Russian President Vladimir Putin ordered the suspension of all flights from Russia to Egypt.

On November 11th, Russia officially banned all aircraft of the national airline of Egypt (Egypt Air) and advised their citizens should not come here. This led the Egyptian tourism industry hit hard. According to Al-Ahram newspaper in Arabic of Egypt, there were 72,000 Russian tourists have left this country after the tragedy. Egyptian Tourism Minister predicted that in the last 3 months of 2015, their tourism industry could suffer over 820 million USD losses.

Goa, a state in India is the favorite destination of Russians in the new year holiday continues to go to “blacklist” due to threats to local security problems as well as the increase in prices at tourist sites.

The crisis started in 2014 when the Ruble devaluation, the number of Russian tourists travel to Goa halved. The number of 2016 will continue to decline. The negative impacts caused Transaero Airlines, which often serving 50% of guests are Russians goes bankruptcy. According to statistics, Russian tourists accounted for nearly 50% of foreign visitors to Goa, with nearly 250,000 visitors in 2013.

According to the Wall Street Journal, the House of Russia published a list of the safe destinations, which encouraging its citizens to come after a series of favorite destinations are included in the “blacklist”. In the three alternative candidates, there was Vietnam.

At the Russia – Vietnam business forum occurred last November in Moscow, Russia suggested that Vietnam should prepare to welcome waves of tourist to come here after many difficulties in Egypt. Moreover, Vietnam should improve the mechanisms to support the Russian tour operators to enter the Vietnam tour market.

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Benefits of Setting up Business in Hanoi

Benefits of Setting up Business in Da Nang

Benefits of Setting up Business in Ho Chi Minh City

Assistance in Setting up Business in Vietnam

M&A Services in Vietnam

This is good sign for Vietnam’s tourism industry after the number of Russian tourists has reduced from the end of 2014 due to the Ruble devaluation causing them to tighten spending. According to the Vietnam National Administration of Tourism, as of November 2015, there are 297,384 Russian visitors come to Vietnam, reached only 90% compared to the same period last year. However, from October, the number of Russian arrivals to Vietnam has increased slightly.

The high season of Russian for traditional wintering lasts from October to the end of March next year. Therefore, it is time for Vietnam to attract the large number of tourists coming from Russia. Moreover, it is particularly advantageous in the context of many favorite destinations of the Russian are no longer safe and Vietnam is recommended by the Russian Government.

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TPP Will Create Breakthrough for Vietnam’s Commercial Real Estate Sector

On October 5th, the TPP agreement has finished negotiation. According to experts, the signing of TPP will expand the opportunity for Vietnam’s economy in general and real estate market in particular.

It seems that foreign real estate investors are more sensitive hearing than domestic investors in the anticipation of macroeconomic policy. The most recent example, funds from Japan and the United States are massively investing in the real estate market of Vietnam. These includes Creed Group (Japan) committed to invest 200 million USD into the An Gia Investment or the Global Emerging Market – GEM (US) has recently committed to pour 20 million USD into Hoang Quan real estate company.

Currently, there is a capital inflow from Japan landing in Vietnam. Many Japanese firms have invested in clean agriculture in Japan and some areas in the Northern of Vietnam to grow fresh vegetables and then export back to Japan. The Japanese are very closely following the TPP negotiation process so they also have investment plans in advance.

After the TPP was signed then what people expect the most is the commercial real estate market will develop better, which include industrial park, office, retail space…as a result of the shift of investment capital flows.

In order to leverage the special tax incentives and cheap labor cost in Vietnam, a lot of businesses in Japan, US had planned about moving factories from China to Vietnam and exported to Japan, US… The main industries that are shifting include textiles, phone manufacturers, automobile manufacturers…. The capital flow shifting will push up demand for commercial real estate.

When the foreign enterprises arrived in Vietnam, they will have to build factories, warehouses. On the other hand, they would create jobs, generate demand for ancillary and service industries. Thus, the system of services like hotels, trade centers, office rental and other services will develop as a result.

Thus, we can also expect M&A in the field of hotel, office, retail, including resort real estate will thrive in the future. Moreover, after the success of TPP, it will push up the industrial real estate market to develop.

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Vietnam is Increasingly Attracting Capital from the US

Vietnam is taking every opportunity to grow its economy and improve the living standard. This is not a vain dream since Vietnam has young and plentiful work force. That is why multinational companies wish to come and set up company in Vietnam.

• Japan Increases Investment in Vietnam in Finance and Services
• Why Japan Investors Invest in Vietnam

The year 2015 marked the 40 years since the war end and the 20 years of normalized the relationship between Vietnam and the US. Vietnam began the process of innovation since 1986 but not until 1995, foreign investment in Vietnam began to flow in when the Government established formal diplomatic relations with the United States and joined the National Association of the South East Asia (ASEAN).

In recent years, foreign investment in Vietnam has accelerated. The Korean company is particularly excited with this market. Samsung Electronics is operating and building three plants at three locations – Ho Chi Minh City, Thai Nguyen and Bac Ninh. In total, this giant electronic corporation has poured more than USD 10 billion in Vietnam.

Vietnam is also expected soon to welcome a “wave” of investment from the US. The Procter & Gamble (P&G) – a consumer goods manufacturer is building a factory in Binh Duong with the cost of 100 million USD. The plant will produce Gillette razors.

Since starting operations in Vietnam in 2008, Intel is also pouring money into this market. This semiconductor giant is planning to manufacture in Vietnam the most of advanced processor for personal computers in the future.

Moreover, other big names come from the US that are expanding operations in Vietnam are Starbucks and McDonald’s. They opened their first store here in December 2013 and February 2014.

There are a number of factors that make foreign investment in Vietnam explode. One of the most important reasons is the low labor cost. Labor cost hikes in China are the reason why many multinational manufacturers turned their attention to Vietnam where the cost is 50% cheaper. Besides, the purchasing power of Vietnam consumer is increasing, inflation has been curbed and many easing regulations to boost growth are also the reason why continuous investments are poured tin..

However, the biggest attraction for most foreign investors is the Trans-Pacific Partnership agreement (TPP) about free trade in which Vietnam is one of 12 countries that participate in negotiations. In mid of this year, General Secretary of Vietnam, Mr. Nguyen Phu Trong will visit the United States. TPP agreement will be the main topic of the conversation with the US officials. If the two countries can reach an agreement, the US will become even more important partner of Vietnam’s economy in the future.

In a press conference in HCM city in January 2015, US Ambassador in Vietnam – Mr. Ted Osius was upbeat about the impact of the TPP to Vietnam economy and the US investment here. TPP agreement “will allow the US to become the number one investor and trading partner of Vietnam” he said.

In about 4.5 million Vietnamese living overseas, about 2 million are living in the US. In particular, many people have made a name in the business world. They are Mr. Henry Nguyen – who brought McDonald’s to Vietnam and Mr. David Thai – founder of Highlands coffee chain.

According to the Ministry of Foreign Affairs of Vietnam, approximately 180,000 companies in the United States are owned by Vietnamese, achieved a total revenue of 20 billion USD. Strengthening ties between the two countries could stimulate greater cash flow stream across the Pacific.

The Ministry of Planning and Investment of Vietnam is estimated to spend 500 billion USD in over 10 years to develop the infrastructure necessary for sustainable growth. However, Vietnam can only able to meet 40% of the above figure, through the Government budget, ODA and private capitals.

That is why the Government wants to attract FDI. The Vietnam Government has set a target to create an industrial economy by 2020. Six priority areas are agriculture, forestry and fisheries processing, agricultural machinery, electronics, shipbuilding, environmental and energy saving, automobile production.

The transition from growth based on FDI into industrial-based growth can be rather difficult. However, Vietnam has shown it is serious and is still on track.

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