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Investment in Vietnam

In: Business and Management

Submitted By sinhvienhue
Words 3767
Pages 16
Recently, Vietnam is attracting increasing interest from international investors as a promising emerging market. Some of the largest U.S. corporations such as Intel, IBM, Wells Fargo, Citigroup, to name a few, started to set foot in the country with confidence.

However, investing in Vietnam still constitutes a conundrum for outsiders and horror stories have been told by former entrepreneurs who lost their fortunes and even almost lost their lives dealing with the Vietnamese Communist Party. Case in point: Trinh Vinh Binh, a Vietnamese Dutch investor who escaped from Vietnam and later sued the Vietnamese government for breach of contract and for confiscating his assets in Vietnam. The case was eventually settled for an undisclosed amount of award in 2007. The initial claim was $150 million (UNCTAD, 2007).

The crucial question remains: “under the current market conditions, is it worth to invest in Vietnam?”

S.W.O.T analysis

Strengths.

1. A fairly large customer base of more than 86 million and growing at a rate of 1% annually. 60% of the population are young, born after 1975 and aspire to become a consumer society with higher standards of life. Wages in Vietnam are among the least expensive in all Asia. Vietnam has a high rate of literacy. 90.3% of the population aged 15 years and older are literate (CIA World Factbook, 2009).

2. Significant reserves of energy and mineral resources such as oil (Vietnam is ranked 33 worldwide among oil producing countries), bauxite, estimated at 8 billion tons and the 3rd largest in the world virtually untouched. Abundant deposits of high quality of silica sand, a vital material for the microprocessor industry, exist along the coast of Center Vietnam (Import export & sourcing, 2009).
Gold and gems stones are spotted all around the country (Business-in-Asia, 2009).

An interesting point to note is that because of

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