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VIETNAM

BRIEF ABOUT THE COUNTRY

AND

OPPORTUNITIES IN DOING BUSINESS

Vietnam Embassy

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CONTENTS:

I. OVERVIEW OF ECONOMY IN VIETNAM

II. OVERVIEW OF FDI IN VIETNAM

III. PROCEDURES FOR INVESTMENT

IV. TIPS FOR DOING BUSINESS IN VIETNAM

Vietnam Embassy

I. ECONOMY OVERVIEW

A/ Brief about geography

- Southeast Asia, land border with China, Laos, Cambodia

- Area: 331,210 sq km, ranked 66th

- Extended 1,650 km from north to south with 3,444 km coastline

- Land use: 34.8% for agriculture, 45% forest and 20.2% for other

Key message: long coastline with deep water and many ports, easy access for goods,

considered as a gateway to ASEAN

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Vietnam Embassy

I. ECONOMY OVERVIEW

B/ Brief about people and society

- Population (2017): 95.5 millions ranked 14

- Age structure: 45% at 25-54 years; 17,2% at 15-24 years; 24% at 0-14 years

- High educated, hard working ethic, ambitious

- Major cities in population (millions): Ho Chi Minh with 8.4, Hanoi (capital) with

7.5, Haiphong with 1.9, Danang with 1.3

Key message: abundant workforce, cheap labor cost, high skilled allocated from the

North to the South through big cities will create opportunities and favor condition for

all kind of business

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Vietnam Embassy

I. ECONOMY OVERVIEW

C/ Brief about the economy

- GPD in 2016: 202.6 billions at exchange rate and 595 billions purchasing power

- GDP growth rate: 5.98% (2014), 6.68% (2015), 6.21% (2016)

- GDP per capital: 2,028 USD (2014); 2,109 USD (2015); 2,185 USD (2016)

- Inflation rate: 4.09% (2014), 0.63% (2015), 4.74% (2016)

- Unemployment rate: 2.08% (2014), 2.31% (2015), 2.3% (2016)

- Export value (billions USD): 162.1 (2015), 175.9 (2016) with main products including rice,

coffee, pepper, clothes, shoes, electronics, seafood, crude oil, wooden products, machinery

- Import value (billions USD): 165.6 (2014), 173.2 (2016) with main commodities like

machinery and equipment, petroleum products, steel products, automobiles

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Vietnam Embassy

I. ECONOMY OVERVIEW

Brief about the economy continued

Key notes for economy:

- Stable political, steady GDP growth rate

- Active member of 63 International Organizations, including: WTO, APEC,

ASEM, UNESCO, UN, IFM, WB, FAO, WHO…

- Partner of many Free Trade Agreements - FTA (including singed and negotiating):

ASEAN, ASEAN – Japan, ASEAN – South Korea, ASEAN – China, ASEAN – India,

ASEAN – Australia and New Zealand, RCEP, Vietnam – Chile, Vietnam – EU,

Vietnam – EFTA, Vietnam – EACU, Vietnam – South Korea, (CPTPP)

Key message: improved business environment to suit with FTA, huge potential

successful chances for foreign investors as free access(*) to all big market in the world

(*): comply with FTAs provision

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Vietnam Embassy

Vietnam

EAS

RCEP

Peru

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Vietnam Embassy

I. ECONOMY OVERVIEW

Vietnam and FTAs

II. FDI OVERVIEW IN VIETNAM

POTENTIAL TO ATTRACT FDI

- Political stability, social security

- Favorable geographical position in the center of Southeast Asia

- Abundant human resource, competitive investment cost

- Rapidly developing economy with potential consumption market

- Abundant natural resources

- Deep economic integration with countries in the region and worldwide

- Legal documents on investment, enterprises and environment are

increasingly completed

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Vietnam Embassy

Source: MPI Vietnam

II. FDI OVERVIEW IN VIETNAM

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As of September 2017, there are 23,972 of projects are in effect withregistered capital of over 308.6 billions USD

Vietnam Embassy

FDI IN VIETNAM BY SECTOR

No. SectorNumber of projects

Registered capital (billion USD)

1 Manufacturing and processing industry 12,217 182.59

2 Real Estate 619 51.2

3Production, Distribution of electricity, gas, water and air, conditioning 114 17.8

4 Construction 1, 448 10.76

5 Accommodation and Food service 598 11.9

6 Whole sale and retail trade; repair of vehicles 2,594 5.8

7 Information and telecommunication 1582 3.3

8 Agriculture, forestry and fishing 515 3.4

9 Transportation and storage 642 4.4

10 Art and entertainment 130 2.7

11 Mining and quarrying 106 4.9

12 Professional, scientific and technical activities 2,367 2.7

13 Health care 130 1.8

14 Water supply and waste management 60 1.5

15 Banking, Finance and Insurance 83 1.4

16 Education and Training 349 0.86

17 Other services 151 0.74

18 Administrative and support services 266 0.52

Total 23,972 308.59

10Source: MPI

Vietnam Embassy

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TOP TEN INVESTORS IN VIETNAM

Source: MPI

No. Partners Projects

Registered investment

capital (billion USD)

1 Korea 6,251 55.6

2 Japan 3,495 45.9

3 Singapore 1,917 41.3

4 Chinese Taipei 2,531 30.7

5 British Virgin Islands 718 22.1

6 Hong Kong 1,239 17.5

7 Malaysia 561 12.1

8 United States 835 9.3

9 China 1,727 11.9

10 Thailand 471 8.4

Vietnam Embassy

FDI IN VIETNAM BY PROVINCE

FDI projects locate in all provinces and cities of Viet Nam; Ho Chi Minh city attracts FDI project mostly, second is Ba Ria – VungTau

Source: MPI

15.7%

12.5%

11.8%

9.2%8.3%

42.5%

Ho Chi Minh Ba Ria-Vung Tau

Ha noi Dong nai

Binh duong Others

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Vietnam Embassy

FDI FROM UNITED KINGDOM

44.5%

25.7%

20.4%

3.9%

1.1%4.4%

Manufacturing Mining

Real estate Finance

Agriculture Others

25.6%

Dong Nai

Oil and gas

Ho chi minh

Ba Ria-Vung Tau

Long An

Others

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As of September 2017, the United Kingdom has 302 valid projects with a total registered

investment capital of over 3.27 billion USD. United Kingdom ranked 15th out of 122

countries and territories investing in Vietnam

By sector By geographical area

Vietnam Embassy

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1. Registration for Investment Certificate (15 days)

• Project with investment capital below 300 billion.

• Not in the conditional investment industries.

2. Evaluation for investment certificate(45 days)

• Projects with capital ≥ 300 billion and not in the conditional

investment industries

• Projects in the conditional investment industries

Vietnam Embassy

InvestorManagement

Agency

(DPI, BOM)

Submitting Investment documents

for registration

Making decision for

Investment Certificate

(15 days)

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2

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Vietnam Embassy

Investors

DPI

(Division of

accepting

records–

Management

Board)

Supplement

records

Requested

supplement

Submitting

8 sets of records

Certificate

granting (5 days)

Provincial

People’s

Committee

(Board of

Management)

Departments,

Ministries /

Branches

3 days

15 days

Prime Minister

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2

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Vietnam Embassy

1. Broadcasting and television;

2. Production, publishing and distribution of cultural products;

3. Exploration and exploitation of minerals;

4. Establishment of infrastructure for telecommunications network, transmission and provision of internet and telecommunications services;

5. Establishment of public postal network and provision of postal services and express services;

6. Construction and operation of river ports, sea ports, terminal and airports;

7. Transportation of goods and passengers by railway, airway, roadway and sea and land waterways;

8. Catching of aquaculture;

9. Production of tobacco;

10. Real estate business;

11. Import, export and distribution business;

12. Education and training;

13. Hospitals and clinics;

14. Other investment sectors in international treaties of which Vietnam is a member and which restrict the opening of the market to foreign investors.

Investment conditions applicable to foreign investors with investment projects in the sectorsstipulated in this list must conform with the provisions in the international treaties of which Vietnamis a member.

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Vietnam Embassy

IV. TIPS FOR DOING BUSINESS IN VIETNAM

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Each country has an unique way for living, setting up and running a

business. Doing business in Vietnam, there are few top tips foreign

investor may take into consideration:

1/ Find a reliable partner

A trustworthy Vietnamese partner or assistant can help you in dealing

with most issue, from finding suppliers to estate matter.

How to find a reliable partner: through British Embassy in Vietnam or

recommendation from Vietnam Embassy in the UK

Vietnam Embassy

IV. TIPS FOR DOING BUSINESS IN VIETNAM

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2/ The language

Learn the language create chance of becoming an insider rather than an

outsider and make Vietnamese people feel you more locally.

3/ Build relationships, keep networking

This is important factor not only in Vietnam but when you are there,

you can see that most of the time your issue may be resolved by some

one you know.

Vietnam Embassy

IV. TIPS FOR DOING BUSINESS IN VIETNAM

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4/ Know “Who” and get the right person

In Vietnam, in whatever matter there is always some one who makes

decision. If you can get the right person, the job can be done with

significant reduced time (such as from 5 days waiting time to 3 days).

5/ Offline payment methods

Online is not new in Vietnam but people still prefer to pay when they get

the goods/service or pay in cash rather than online payment. Between

two companies, one has only online payment, other provides offline then

most customers tend to use the second.

Vietnam Embassy

IV. TIPS FOR DOING BUSINESS IN VIETNAM

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6/ Be ready to face with difficulties

When foreigner investors come to Vietnam they may feel there are too

many complicated and difficulties from the beginning such as:

Construction Permits (if build a new facility), Getting Electricity (if

there is not any existing), Paying Taxes (about 32 corporate tax

payments to be made annually, cost around 872 hours to complete

forms and procedures)

However, when you are in the country and blend into the flow you can

see that there are many ways to solve the issue. Many successful British

companies doing business in Vietnam now such as Harvey Nash,

Prudential, Standard Chartered etc…

Vietnam Embassy

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Thank you !

Vietnam Embassy