VIETNAM
COUNTRY REPORT
BY GEORGIANA KATHRYN KNOX
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VIETNAM
COUNTRY TRAITS
Vietnam occupies the eastern coast of the Southeast Asian peninsula. It is bordered by China to the north, and Laos and Cambodia to the west. The country is spread over 127,1881 mi², which is equivalent to half the size of Texas. Vietnam’s terrain consists of tropical savanna lowlands in the south, humid subtropical high lands in the north and the Day Troung Son central mountains . This Physiography provides Vietnam with fertile land as well as an abundance of natural resources.
L A N G U A G E Vietnamese G O V E R N M E N T Communism P O P U L AT I O N 89.71 Million R E L I G I O N Confucianism C U R R E N C Y Dong C A P I TA L Hanoi C H E I F O F S TAT E Pres. Truong Tan Sang H E A D O F G O V E R N M E N T PM Nguyen Tan Dung L I T E R A C Y R AT E 93% T I M E Z O N E + 11 hours L I F E E X P E C TA N C Y 72.1 years M I N I M U M WA G E $0.29 USD
G D P P E R C A P I TA $957.40 G D P G R O W T H R AT E 7.4% I N F L AT I O N R AT E 5.1% IMPORTS
EXPORTS
Raw Cotton
Petroleum
Crude Oil
Tea
Grain
Machinery
Rice
Clothing
Steel
Fertilizer
Coffee
Shoes
Plastic
Cement
Rubber
Electronics
V I E T N A M ’ S N AT U R A L R E S O U R C E S
OIL
FORREST
NATURAL GAS
COAL
COUNTRY STABILITY
SOCIAL
Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social Vietnam culturallyhas always rich country whose distinct values, is anda education been considered as one history played a role in the development of thedesire modern of the best values that a person should to day state. Vietnamese practices of Confucianism and achieve. showing reverence towards ancestors are evidence of China’s historical influence on Vietnamese society. Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social values, and education has always been considered as one of the best values that a person should desire to achieve. Education in Vietnam is divided into five levels: preschool, primary school, secondary school, high school and higher education. Formal education consists of twelve years of basic education. According to PISA testing Vietnam ranks within the top 20 education systems in the world, with a 93% adult literacy rate, 92% of eligible children were enrolled in primary school.
40%
.......... 2002
15% 2014
...........
Living under $1.25 per day
Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social values, and education has always The Socialist Republic of Vietnam In economic terms Vietnam is a rapidly rising power. Since the beginning been considered as one of the best values is a single-party communist state. of this century, it has held 3rd place in average annual GDP growth, while that a person should desire to In 2011 Vietnam launched their per capita income rose from $220 in 1994 to $957.40 in 2015. achieve. new strategy to reform and improve 10.0 Socio-Economic climate. The goal 9.0 of this political and economic reform is to stabilize the economy, 8.0 build world-class infrastructure, 7.0 and create a skilled labor force. 6.0 Currently Vietnam is committed to fighting corruption in its 5.0 government to create political 4.0 stability while improving ties with countries around the world. 3.0
POLITICAL
Billion Dollars
ECONOMIC
2.0 1.0 2010
2011
2012
2013 = GDP
2014
2015
onfucian ethics has strongly influenced upon Vietnamese’s viewpoint of social values, and education has always been considered as one of the best values that a person chieve.
should desire to
COUNTRY STABILITY
E N V I R O N M E N TA L
Vietnam is working hard to produce less of an environmental footprint, but with the increase of production in the recent years and urban growth, has had an increase in carbon dioxide emissions and carbon fuel usage. The major international pacts and agreements that Vietnam is party to are:
E N V I R O N M E N TA L C O N C E R N S - Soil Depletion Due to Over Farming - Landslides During Monsoon Season -Droughts During Dry Season - Pollution From Production
Climate Change
TECHNOLOGICAL
Ozone Protection Hazardous Wastes
89.7
TOTAL POPULATION IN VITNAM m i l l i o n 69% Rural
31% Urban
INTERNET USERS E - C O M M E R C E M A R K E T $450 Million AV E . I N T E R N E T H O U R S 4 Hrs Per Day S M A R T P H O N E U S A G E 20% of Population M O B I L E B U Y I N G 60% of Smartphone Users 36,140,967
-Salinisation Reducing Soil Fertility Endangered Species
50 INTERNET USERS IN MILLIONS
Biodiversity
-Erosion of River Banks and Coastline
45 40 35 30 25 20 15 10 5 2010
2011
2012
2013
2014
= Internet Users
2015
Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social values, and education has always been considered as one of the best values that a person achieve.
should desire to
LEAD TIME ON PRODUCTION
N AT I O N A L H O L I D AY S
W E AT H E R R I S K S
February 19th- Vietnamese New Year’s Eve
Dry Season- January to September
February 20th- Vietnamese New Year April 28th- Kings’ Commemoration Day May 1st- International Labor Day September 2nd- Independence Day
Droughts Are Expected, as well as well as typhoons during July. Monsoon Season- October to December Landslides, Floods & Cyclones are typical During Monsoon
H I G H WAY S Y S T E M S
The road system consists of over 200,000 km network including over 10,000 bridges. However road conditions are not ideal, less than half of the national highways have two lanes or more. In addition, road congestion is increasing in major cities. In recent years, the Government has mobilized a significantly large amount of capital to upgrade the highway system with financial support from international lending agencies.
R A I LWAY
The rail network consists of about 2,600 km of single track line covering several routes. There are about 260 stations in the network. The longest and most important route is the Hanoi Ho Chi Minh City line, which stretches for 1,730 km. This line is now serviced by an express train, which makes the journey in approximately 29.5 hours. The lines connecting Vietnam to China were re-opened a few years ago.
WAT E R WAY
Vietnam has eleven major seaports. Ho Chi Minh City serves most of the South and now boasts modern container loading facilities. Just a few hours’ drive from Hanoi, Hai Phong serves much of the North. Given the rapid rise in trade volume, increasing port capacity is a national priority.
BUSINESS CONDUCT
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Vietnam business etiquette is very formal. Meetings are often planned in advance and follow a very strict schedule. Keep in mind that Confucianism has flavored Vietnamese society. Confucianism stresses the relationships that people have with each other. Each of these relationships dictates a Vietnamese person’s actions. Remember that Vietnamese business people also emphasize relationships.
Appointments are required and should be made several weeks in advance. The Vietnamese are punctual and expect others to be so to0. Dress conservatively. Handshakes are used upon meeting and departing. Handshakes only take place between members of the same sex. Always wait for a woman to extend her hand. If she does not, bow your head slightly. The spoken word is very important. Never make promises that you can not keep to as this will lead to a loss of face.
Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social Do not touch someone’s head. values, and education has always been considered as one Do not point with your finger - use your hand. of the best values that a person should desire to Do not stand with your hands on your hips. achieve.
BODY
LANGUAGE
Do not cross your arms on your chest. Do not pass anything over some. Pass items with both hands.
E M A I L ETIQUETTE KEEP IT SIMPLE
Make your emails short & avoid using slang.
SEARCHABLE EMAIL
Use key words to make your emails easier to find later on.
SUBJECT LINE
Consolidate your email and attachments in the subject line.
KEEP IT ORGANIZED
Keep your emails within one reply strand.
R E P LY T O A L L
So everyone is clear with what is being discussed.
Confucian ethics has strongly influenced upon Vietnamese’s viewpoint of social Vietnam a strong player in the global textile values,has andbecome education has always been considered as one market. The that a textileperson and apparel playsdesire a major of the best values industry should to role in the country’s recent prosperity. The Vietnamese achieve. textile industry has over 3,800 companies and is one of the leading exports. The country ranks fifth worldwide in textile and apparel exports and has a labor force of over 2 million people, with 1.3 million people working directly in the industry. State-owned enterprises make up just 0.5% of Vietnam’s businesses; however, 75% of all businesses are joint stock or limited companies. The Vietnamese textile and apparel industry has an ambitious target plan, with investment capital estimated to total approximately $25 billion in 2020 The Vietnamese textile and apparel industry’s customers include some of the top labels worldwide. Including Levi Strauss Co., Nike Inc., Gap Inc., Liz Claiborne, and Target Brands Inc.
A P PA R E L A N D T E X T I L E
STRENGTHS
TEXTILE INDUSTRY
$48.7 BILLION INDIA 2015
•Dominant exporting capability and highly potential domestic market. •Low costs, skillful labor force. • Renovated and modernized equipment. •Stable political environment •Incentive policies.
W E E K N E S S E S • Most enterprises are medium and small size.
• 50% of raw materials are imported. • Production management is still weak and inefficient. • Marketing strategy is not paid serious attention.
OPPORTUNITIES
•Shifting trend from China to Association of Southeast Asian Nations . •Attracting investors from potential markets such as Russia and Korea. •Expanding market share in United States, European Union and Japan. •Large population: 86 million people.
T H R E AT S
•Strong competition from rivals including China, India and Indonesia; • Bargains of technology, hygiene, social responsibilities.
$35.5 BILLION
C O M PA R I N G THE TEXTILE INDUSTRY
VIETNAM 2015
SWOT
analysis
TRADING IN VIETNAM
CURRENCY CONVERSION
1 VND = 0.00005 USD
TRADE AGREEMENTS B TA - U . S . - V i e t n a m B i l a t e r a l Tr a d e A g r e e m e n t
The BTA is the most comprehensive trade agreement Vietnam has signed to date. This document covers trade in goods, protection of intellectual property rights, trade in services, investment protection, business facilitation and transparency. This agreement means Vietnam’s products are now have a much lower tariffs, dropping the average from 40% to 3% when products enter the US. Vietnam has committed to reform its trade to provide a much more level playing field for U.S. companies and products in Vietnam.
T P P - Tr a n s - P a c i f i c P a r t n e r s h i p
The Trans-Pacific Partnership is a proposed agreement by President Barack Obama that will permit trade between Asian pacific countries and eliminate tariffs and other barriers on goods, and create new opportunities for our workers and businesses and benefit our consumers. The twelve countries involved in the agreement are looking to increase international trade, and promote economic growth and higher living standards.
MAIN PORTS IN VIETNAM SAIGON PORT
Ho Chi Minh City 3 Nguyen Tat Thanh street www.csg.com.vn
PORT OF HO CHI MINH CITY
Ho Chi Minh City Saigon Newport Company
DA NANG PORT
Da Nang Vietnam National Shipping Lines www.danangportvn.com
DENIM
N I E N H S I N G G A R M E N T C O . LT D .
A P PA R E L SUPPLIERS
WEBSITE- www.nhjeans.com CONTACT- Ryan Chen, Tran Thi Dung, Phuc Khanh Industrial Park, Thai Binh, Vietnam
S P E C I A L I Z E S I N : Denim, Cotton Tops and Bottoms, Khakis N O TA B L E C L I E N T S : The Gap, Kohl’s Department Stores, Old Navy, and American Eagle
S A I D O N 3 G A R M E N T J O I N T- S T O C K C O M PA N Y
WEBSITE- www.saigon3.com.vn CONTACT- +84 88225255 Trousers; Jeans, Khakis, and Sportswear Bottoms
SPECIALIZES IN: N O TA B L E C L I E N T S : Uniqlo, Levi Strauss & Co Mexico, USA and Canada.
A P L N O L V I E T N A M LT D .
www.nhjeans.com CONTACT- 17 Ba Huyen Thanh Quan Dist 3 Hcm Vietnam Apl Logistics Shipper
S P E C I A L I Z E S I N : Denim Pants, Woven Bottoms, Spandex Bottoms N O TA B L E C L I E N T S : Nike, Under Armour, The Gap, Levi Strauss, and Pacsun
S C AV I H U E C O M PA N Y
LINGERIE
WEBSITE- www.scavi.com.vn CONTACT- +84 543751751, info@scavi.com.vn
S P E C I A L I Z E S I N : Bras, Mens and Womens Underwear, and Nylon Spandex N O TA B L E C L I E N T S : Hsnes Brand, Union Underwear, and Fruit of the Loom
KNITT TOPS E S Q U E L G A R M E N T M A N U FA C T U R I N G C O LT D WEBSITE- www.saigon3.com.vn CONTACT- +84 88225255
S P E C I A L I Z E S I N : Cotton Shirts, Polos, and Cotton Knitts N O TA B L E C L I E N T S : Hugo Boss, Polo Ralph Lauren, Patagonia, and Nautica
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S H I P P I N G C O M PA N I E S A N D C O S T
Z I M I N T E G R AT E D S H I P P I N G S E R V I C E S LT D . D E PA R T U R E : Ho Chi Minh City Terminal, Vietnam A R R I VA L S AVA N N A H , G A : 41 Days; $7,200 USD L O S A N G E L O S , C A : 21 Days; $4,800 USD N E W Y O R K C I T Y, N Y 45 Days; $6,100 USD
L O G W I N T R A N S P O R AT I O N I N V I E T N A M D E PA R T U R E : Da Nang Port, Vietnam A R R I VA L
S AVA N N A H , G A : 33 Days; $3,800 USD L O S A N G E L O S , C A : 25 Days; $4,000 USD N E W Y O R K C I T Y, N Y 45 Days; $4,000 USD
HO CHI MINH
VIETNAM
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S AVA N N A H , G A : 43 Days; $5,800 USD L O S A N G E L O S , C A : 23 Days; $4,600 USD N E W Y O R K C I T Y, N Y 48 Days; $5,800 USD
VIETNAM .......................
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V I E T N A M O C E A N S H I P P I N G C O M PA N Y ( V O S C O ) D E PA R T U R E : Saignon Port, Vietnam A R R I VA L
DA NANG PORT
SAIGNON PORT
VIETNAM
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T R A S P O R TAT I O N AND SHIPPING
PROS & CONS
PROS
+ + + + + + + +
2nd Fastest Growing Economy US-Vietnam Bilateral Trade Agreement Large Labor Force of 46,480,000 Workers Strong Work Ethic 93% Literacy Rate Average Wage is $0.49/hour Booming Exports Market Stabilization of Dong Exchange Rate
CONS
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National Law Does not Support Labor Standards Underdeveloped Apparel Industry Primarily Outsourced Fabric Lack of Federal Trade Agreement with the West Unstable Infrastructure Primarily Agriculture Oriented Lower Quality Sewing Long Transportation Time
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