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Agenda:
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• Vietnam’s 2013 Economy at a Glance
• Vietnam Economy Forecast
• Foreign Direct Investment and Investment
Opportunities in Vietnam
• Effects of TPP and EU - FTA Agreements to
Vietnam’s Economy
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Vietnam 2013 Economy at a glance
• GDP: US$170.4 billion
• GDP per capita: US$1,890
• GDP Growth: 5.42 %
• Inflation: 6.04%
• Population: About 90 million
• Labor force aged 15 and above:
51.69 million
• Total export and import
turnover: : US$ $264.26 billion
• Minimum wage: VND 2.7
million (US$ 128) per month
(Jan 2014)
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Vietnam’s Economy Forecast
• 2013 proved a quite positive year for Vietnam economy
• In 2014, Vietnam is expected with a brighter economic situation:
Macro economy and monetary policy will remain stably
The inflation will be under control, estimated rate of between 7-8 %
2014’s GDP is estimated to rise from 5.8 -6%
• Exports, especially FDI manufacturing companies, will push the growth
of Vietnam’s economy in 2014
• Stronger reform of institutional and administrative procedures to improve
investment environment
• IPO’s activities will be very active when the SOE equitization is speeded
up: Targeted to equitize 432 companies in 2014 -2015
• Foreign direct investment is likely to increase significantly in 2014,
especially after Vietnam conclude TPP and EU-FTA agreements
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Foreign Direct Investment in Vietnam
• FDI situation in 2013:
Total newly registered and added capital is nearly USD 22 billion, an
increase of 69 percent compared to USD 13.013 billion in 2012
Vietnam attracted more than 12,000 new FDI projects and nearly 500 projects
added its investment capital
• Will Vietnam Still be a FDI good destination?
Even with a sharply FDI drop in recent years and current cautious economy,
2013 FDI increase shows Vietnam’s attraction as a FDI good destination
Japanese investors keep coming to Vietnam and emerging wave of M&A
from ASEAN investors
The plant move of Japanese and Korean giant industrial firms into Vietnam:
Example of Samsung: In 2013, kicked off the construction of mobile
production plant with a total investment of USD 3.2 billion.
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Investment Opportunities in Vietnam
• Potential and huge opportunities of an emerging market: With the
population of about 90 millions , mostly in the working age and having income
more and more increased
• Rich natural resources and strategic geography location: Long coastline
with great geography to become an Indochina logistics hub, able to export to and
import from key markets
• Notably investment attractive industries: Real Estate and Properties;
Healthcare and Pharmaceuticals; Food and Beverage; Retail; Hospitality and
Leisure, etc…
The F&B industry is the most attractive industry in 2013 while the Health Care
and Pharmaceutical placed the No.1 position in 2013 according to this Grant
Thornton survey
• More investment opportunities after Vietnam conclude TPP and EU-FTA
agreements : More opportunities for the foreign investor to enter into and form
Vietnam as a manufacturing center to export to the big worldwide markets
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WTO ANALYSIS OF LIBERALIZATION
OF MARKET ACCESS
Vietnam ties in first place with Singapore
• *Typical restrictions: number of opened sectors, JV requirement,
limits on foreign-owned shares, permission requirement
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Country Limitation of
market access*
Country Limitation of
market access*
Malaysia medium Myanmar high
Indonesia medium Cambodia medium
Philippines medium Laos medium
Singapore low India high
Thailand medium China medium
Brunei high Vietnam low
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Investment Legislation Reform
• Vietnam is actively working to better its’ legal framework on
investment and business, especially simplifying
administrative procedures in the fields, in order to attract
more foreign investment in the coming time
• 2014 proves to be a crucial year as a long set of new laws will
be coming:
New Law on Enterprises is under drafting session which promises
solutions for many issues during the implementation of the current Law
Law on Investment is under review also and it may be in line with the Law
on Enterprises
New decree on PPP which would repeal the Prime Minister’s pilot decision
may be soon passed but the first draft was not really sophisticated and it
needs substantial revision
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Negotiation Process of TPP and EU - FTA
• EU-FTA negotiation process:
The EU - FTA was launched negotiation in June 2012
The most recent, sixth round negotiation was in Brussels from 13-17
January, 2014
Next negotiation round will be held in Hanoi from 17-21 March 2014
Vietnam and the EU appear set to conclude the FTA by as early as fall 2014
• TPP negotiation process:
TPP is one of the most ambitious FTAs between 12 countries
The TPP negotiation parties are the home of 40% of the world’s
population, produces nearly 60% of global GDP
The TPP has been under negotiation for five years.
Vietnam hopes to conclude TPP in first half of 2014
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Opportunities of Vietnam in TPP and EU -
FTA Agreements?
The EU, the US and Japan are the leading
economic, trade and investment partners
of Vietnam
TPP and FTA agreements will help
Vietnam’s businesses, boost their exports
and remove the current heavy taxation
barrier
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No. 2012 Partners Mio US$ %
World (all
countries)
255,273 100.0
1 China 54,029 21.2
2 EU 27 29,615 11.6
3 Japan 26,340 10.3
4 United States 25,318 9.9
5 South Korea 23,466 9.2
6 Singapore 13,895 5.4
7 Hong Kong 11,836 4.6
8 Thailand 10,376 4.1
9 Malaysia 9,239 3.6
10 India 5,961 2.3
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Opportunities of Vietnam in TPP and EU -
FTA Agreements?
• Reducing at least most of tariff lines on Vietnam's exports to zero per
cent, and increasing foreign investment capital sources for Vietnam
• The FTA signing will open up many new opportunities for Vietnamese
businesses to penetrate deeper into the EU market and force them to
move closer to international standards
• Many excellent opportunities for Viet Nam’s textiles and garments
industry to expand into TPP countries , especially the USA, the Japan and
EU’s member markets.
Currently, Viet Nam is the 5th largest textiles and garments exporter in
the world
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