Vietnam offers investment opportunities

MANILA, Philippines - Vietnam’s economic reforms have made it conducive for foreign investments, franchising included as Southeast Asia becomes a unified market by next year.

Vietnamese Ambassador Truong Trieu Duong said Vietnam’s GDP growth rate of 6.7 percent at $171.4 billion in 2013 makes it an attractive investment area. 

“The 1986 economic reforms created an environment conducive for foreign investors, with most industries open for foreign direct investments thereby enhancing competition and business growth,” Duong said in a trade and investment forum sponsored by the Cebu Chamber of Commerce recently.

Vietnamese World Trade in 2013 stood at $263.5 billion, of which exports totaled $132 billion and imports valued at $131 billion.

Annual bilateral trade between Vietnam and the Philippines amounted to $2.6 billion last year.

Since 2008, Vietnam’s annual export surplus to the Philippines has reached over $1 billion. The biggest share of exports is rice, and the export surplus is considered the highest in ASEAN.

Vietnamese Commercial officer Vu Viet Nga Couns said the franchising business in Vietnam is at an early stage of development but is an area where the Philippines could increase its trade with Vietnam.

The Pho 24 franchise, developed by Vietnamese entrepreneur Ly Quy Trung, was sold to David Thai’s Viet Thai International Company and was eventually co-owned by Filipino food service magnate Tony Tan Caktiong through his Jollibee Worldwide subsidiary.

Investor Relations Global Inc. (IRG) managing director Angel Bunag said population growth in Vietnam of 158 percent to 89.7 million in 2013 from 34.7 million in 1960 is a good indicator for the franchising business.

IRG supported the franchise businesses here and abroad of the Jollibee group, with our integrated services from branding to product and packaging development to marketing and advertising, retail environment/management and design and others.

“The apparent rise in consumerism in Vietnam with an eight to 12 million urban middle-class consumers and a young population of 15 years and under at 24.6 percent – present a dynamic market opportunity for franchisors and franchisees to develop and establish chains, expand and exponentially increase retail sales,” he said. “Any two-way trade business that is generated by this roadshow presentation of Ambassador Duong and company is a foretaste, a sampling of what is to come among ASEAN member countries.”

As of late February, the Philippines poured in $285 million into 65 investment projects in Vietnam, ranking 29th among 101 countries and territories investing in Vietnam.

Bilateral cooperation in education, culture, sports, tourism, defense and security have also achieved positive results. Especially, both countries are paying attention to boosting marine and ocean cooperation, one of the main pillars in bilateral relations.

VietNamNet, the first online newspaper in Vietnam, reported that Vietnam intends to raise its competitiveness by improving capacity, raising economic position and promoting institutional reform to capitalize on opportunities offered by the economic integration in the ASEAN region.

Last year, Vietnam took advantage of the reductions in tariffs by complying with the rule of origin. Its seafood businesses significantly benefited from the abolition of tariff barriers.

The online newspaper said that a high number of Made-in-Vietnam products are qualified for the rule of origin, which is also easily met by other countries.

Local businesses are taking advantage of the rule of origin maintain the competitiveness of its garment, footwear and electronics sectors.