With an average GDP growth of nearly 6% over past five years, it’s clear that Vietnam is one of the most promising economies in Asia. This year, the spotlight is on this country as several key business events targeted Vietnam, including the Economist’s Vietnam Summit and the upcoming Bloomberg ASEAN Summit.
Even though Vero has operated in Ho Chi Minh city since 2008, it’s always great to get new perspectives – so we didn’t miss the chance to meet with other business people and government officers in Vietnam at the Economist Summit last week. And here are some observations and findings from the summit.
1. ECONOMIC REFORM IS THE BIGGEST HEADLINE AND TOPIC
Many of the topics discussed at the Vietnam Summit touched on this subject and the privatization of state owned-enterprises in particular. And if you pick any newspapers in Vietnam, you’d see at least one article relating to this initiative.
The Vietnam government has set a clear vision for its five-year national economy restructuring plan toward 2020. It’s to integrate the country into higher value of global supply chain. This means the country will encourage investments in high technology manufacturing, R&D and innovation. The plan is that the country will no longer need to rely on low labor costs, but instead productivity. Along with this goal, the government aims to reduce employment in the agricultural sector from 70 percent to 40 percent, according to Pham Binh Minh, Deputy Prime Minister and Minister of Foreign Affairs.
To support this initiative, the government has signed 55 FTAs so far to improve its competitiveness in global trade.
2. HUMAN CAPITAL IS ONE OF THE KEY CHALLENGES
To achieve its economic goals as stated in the five-year plan, of course, human resources are crucial. However, many delegates and some of speakers at the Vietnam Summit admitted that finding and retaining talents are challenging. They would like the government to provide skillful employees to business sectors. And this isn’t only about English language but also knowledge and skill in new technologies, science and mathematics.
Speaking from my perspective as a PR person, as of today, Vietnamese is the language you have to deploy when you want to engage with Vietnamese both private and government sectors because policy makers and many of Vietnamese business leaders are more comfortable to communicate in Vietnamese. This practice is similar to other ASEAN countries who have strong preference for their own language e.g. Thailand, Laos, Cambodia and Myanmar.
3. START-UP COMMUNITY IS GROWING
As an estimated 95 to 98 percent of businesses in Vietnam are SMEs, you’ll see every kind of business in Vietnam. Everyone seems to be an entrepreneur. From ladies with small portable charcoal stoves selling spring rolls and other local foods to a man running around to sell raincoats to people on the day it suddenly rains in Ho Chi Minh.
Vietnamese have an entrepreneurial spirit of their own. That’s why the company known as 500 Startups and Vietnam’s very own Silicon Valley are gaining more and more young members.
During the Vietnam Summit, we met with a number of young startups taking advantage of today’s mobile internet technology. Even though their products and services are similar with other e-commerce or on-demand grocery shopping services, they’ve been doing well so far because they know their customers and they speak the same language.
4. VIETNAMESE ARE KEEN TO LEARN NEW THINGS
According to Tiki, the fourth largest e-commerce business in Vietnam, the best seller product category on their website is books. Meanwhile a lot of newly graduates are willing to gain real working experience from internship. This reflects enthusiasm to learn new things and gain knowledge and experience to pursue a better future. What’s more, Vietnam’s students are topping the charts on standardized tests. The Vietnam Program for International Student Assessment (PISA) scores, which studies 15-year-old school pupils’ scholastic performance on mathematics, science, and reading shows that Vietnamese students are scoring higher than US students in all three categories.
5. COFFEE CULTURE SOCIETY
Vietnam is obviously a coffee culture. They grow coffee, produce and sell coffee products and have café on every corner. You will see young Vietnamese people working on their laptop or hanging out with friends at nicely decorated cafés almost around the clock. Vietnamese people drink strong coffee and they prefer their coffee to be aromatic. Sometimes they roast corn together with coffee. As an observer, this reflects that Vietnamese people are energetic, know exactly how to enjoy their lives and reward themselves after working tirelessly. One of evidence to confirm that Vietnamese know how to reward themselves are increasing number of international flights from Vietnam