Vietnam - Market Overview
Vietnam no longer fits the American stereotype. It is one of the most dynamic markets in the world. Envisioning Vietnam as a land full of conical hats, emerald green rice paddies, and women in ao dais biking along a dusty street is an antiquated image. Ho Chi Minh City, Hanoi, and Danang are burgeoning into cosmopolitan cites that are bustling with small businesses and tourists.
Vietnam presently offers a strong combination of rapid growth, social stability, and an excellent demographic profile that is fueling industrial production and consumer demand. The country is undergoing a remarkable transition from a planned economy to a market economy, following a similar path to China. Since the implementation of the Bilateral Trade Agreement in 2001, two-way trade has grown by a factor of ten.
After a 20-year break in diplomatic ties, President Clinton removed the trade embargo on Vietnam and normal diplomatic ties were established on July 11, 1995. In December 2001, the U.S.-Vietnam Bilateral Trade Agreement came into effect. Tariff reductions and removal of market barriers have created new opportunities for U.S. trade and investment. Currently, the U.S. is one of the top investors in Vietnam, whether it be direct or via a third-country. Moreover, the U.S. remains the main destination for Vietnamese exporters.
Despite the diplomatic hiatus and misperceptions created from the Vietnam War, Americans and American products and service providers are very well received in Vietnam. There is a large influx of U.S. tourists and more than one million Americans born in Vietnam. Consequently, Vietnamese are becoming more familiar with and welcoming to American culture and customs. The partnership between these two nations is easy and natural.
Vietnam - The Next Frontier!
Opportunities for trade within Vietnam are staggering! U.S. exporters can target a high number of consumers. Poverty reduction, the continual rise in per capita income, the large amount of domestic savings, and the flourishing number of small businesses are creating a strong domestic demand for imports. In addition, upcoming projects will make exporting to Vietnam that much easier, such as the construction of a major new international airport in Ho Chi Minh City (Saigon), a new deep water seaport near Vung Tau, and a planned express Customs’ line for qualified U.S. products.
Like China, the Communist Party is enacting open market reforms that include greater transparency of laws and regulations. Political leaders are permitting an entrepreneurial culture that is more responsive to the needs of private businesses. These reforms are fueling one of the fastest growing economies in the world, maintaining real GDP growth at around 8%.
Photo: a view of Saigon's Port
Furthermore, Vietnam is well endowed with natural resources, enterprising people, and a favorable geographic location- bordoring China and close to the main regional commercial hubs in Bangkok and Singapore. Venture capital is now beginning to flow into Vietnam, including funds specializing in high-tech enterprises. In February of this year, for example, Intel received a license to invest $600 million in a semiconductor assembly and test manufacturing facility in Ho Chi Minh City, choosing Vietnam over both India and China for its latest factory base. In fact, many foreign investors now see Vietnam as a cost-effective hedge to China.
Vietnam’s remarkable momentum in economic development will only continue with its accession to the WTO, which is expected to occur by the end of this year or early next year. WTO membership will pave the way for the establishment of permanent normal trade relations (PNTR) by the U.S. Congress and lay a solid foundation for increased bilateral trade and investment. Vietnam’s leadership has made it clear that they are fully committed to undertaking the necessary reforms required by WTO and to following international standards and norms.
2006 is the year for Vietnam to make a major splash on the world’s business stage. Apart from its anticipated WTO membership, Vietnam will host the annual APEC summit in Hanoi this November. This APEC summit will concentrate on "building a dynamic international community for sustainable development and prosperity." Vietnam will accommodate representatives from over 21 countries in the Asia Pacific region. APEC economies produce 57% of world output, 45% of world trade volume, and represent 44% of the global population. Vietnam’s willingness to host the summit is yet another example of its dedication to the regional economic cooperation and its established links to other Asian economies.
Within the next decade, Vietnam’s economy will double in size. Continuing economic development will increase the demand for American goods and services, making Vietnam an ideal environment for U.S. exporters and investors. Most importantly, exporting to Vietnam is not as difficult as one would think! If you have any questions, contact the U.S. Commercial Service in Vietnam.
For those who are comfortable conducting business over the Internet, U.S. Commercial Service Vietnam offers an “E-Counseling” Suite. These communication technologies allow clients to discuss business prospects live with our Commercial Specialists in Hanoi and Ho Chi Minh City. The suite includes email (with PDF attachments), Voice over Internet Protocol, and Webconferences at a moderate cost. See our website (www.buyusa.gov/vietnam) for more details about our “E-Counseling” services. Our commercial specialists can answer specific questions about market opportunities and help you bring your business plans to fruition.
Vietnam - Market of Opportunities
Best Prospects For American Exporters (Click on the sector for more information)
- Power Generation, Tranmission and Distribution
- Telecommunications Equipment and Services
- Oil and Gas Machinery and Services
- Computer Hardware and Software Services
- Airport and Ground Support Equipment
- Environmental Technologies –Pollution Control Equipment
- Packaging Equipment
- Medical Equipment
- Safety and Security Equipment
- Education and Training
- Franchising
Vietnam - Upcoming Events And Networking Opportunities
- Open the Banks: "Banking on Development 2006"
- International Dental Exhibition and Meeting
- Offshore Technology Conference
- U.S. Electric Power Trade Mission to Thailand, Vietnam and the Philippines
- International Franchise Expo
- Automotive Aftermarket Products Expo
- See all events >>
Vietnam - How We Help You Export
- Get Customized Export Solutions
- Obtain Market Intelligence
- Promote Your Products
- Develop Business Contacts
- Bid in Vietnam projects funded by multilateral donors
- Get assistance in trade dispute & other commercial disputes
- Advocate for U.S. firms