Reasons That Phu Quoc Island Attracts Major Investors

  Natural beauty of Phu Quoc, the policy mechanisms and long-term orientation are reasons why this island attracts many major investors.

2015 is considered to be a difficult year for the tourism industry as the number of tourists coming to Vietnam decreased compared to the previous year and also the first year that the number of tourists coming to Vietnam decreased since 2009. However, in the general context, there is an island in Vietnam goes upstream as seen in the number of tourists increased by 30%. That's Phu Quoc Island.

Every day, Phu Quoc has 50 coming and going flights. In the first 6 months of 2016, the number of tourists traveling to Phu Quoc has reached 1 million. Within 5 recent years, Phu Quoc Island has attracted large number of investors, in which among them there are almost all of the largest investors in Vietnam in the field of resort tourism.

Phu Quoc Island is known as the jewel in the southwestern sea areas of Vietnam. Phu Quoc Island has 27 large and small islands with the natural area of nearly 600km2, which is nearly equal to the natural area of Singapore. With this location, Phu Quoc is only 2 hours fly to capital cities of ASEAN countries, connecting by sea with the ASEAN countries that have sea, locating on the important maritime transportation and marine tourism axis, which is axis of Singapore - Thailand - Vietnam - Northeast Asian countries.

Phu Quoc Island has a coastline of 150km with beautiful and famous white sandy beaches. Phu Quoc Island has nearly 100 mountains and 36,000 hectares of forests with diverse ecosystems. Forest coverage accounts for over 60% of the area of Phu Quoc.

In particular, although Phu Quoc is island but there are abundant freshwater resources to ensure social and economic development of the island and a rich and unique marine ecosystem. In addition to the natural ecological tourism, Phu Quoc has unique features in terms of social and culture which are the famous pepper, fish sauce and pearl farming production.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Why do we have to undertake background check before recruitment?

  Recruitment is the process of screening and recruiting qualified people to meet a job in an organization in general and in particular business. Recruitment plays a very important role in business development. Effective recruitment will provide businesses with a team of skilled, active, creative employees and provide human resources in accordance with the business performance of the business. Only when doing well the recruitment stage can we do well in the next stages. Therefore, businesses need to recruit the right people right the first time as well as arrange them in an important position.

Most of the information that enterprise has is provided by the employee and there is no verification of the information. And if the enterprise only relies on the information provided by the employee, it is likely that the employee is dishonest, or causes mistakes and avoid responsibility. To recruit “right employee, right job”, enterprise needs to check the applicant’s background.

Checking employee's background is to create trust between enterprise and employee. The background check includes: Verify Identification; Verify at home; Verify qualifications and certificates; Verify employment history at old jobs; Verify criminal records in Vietnam.

Verification of the background helps to know personal information, origin, hometown, criminal status of the employee. Thereby, background check will minimize commercial risks; preventing fraud and internal theft better; increase security of data and documents in the enterprise. In particular, for important positions in the enterprise, the confidentiality of enterprise document information is extremely necessary.

Verifying employment history at past jobs is to understand working process and the reason for job termination; obtain an objective view of the necessary competencies, skills and work experience. From there, enterprise could save time in searching for suitable employees as well as saving labor training costs.

In addition, background check improves business efficiency, developes a team of integrity to meet the business requirements of the enterprise. Because recruiting well means finding out people to perform the job with the capabilities and qualities to complete the assigned work, then effective recruitment helps the enterprise perform well its business goal and improve profitability.

Currently, the situation of fraud, diploma trading, or dishonesty in recruitment, many enterprises cannot control and verify all the information that employees provide. Enterprises need to check applicant's background when recruiting to prevent fraud, internal theft; increasing security of data and documents in enterprises; decrease recruitment time and training costs. Besides, creating trust between businesses and employees; increase employee productivity and product quality as well as increase business profits.  It is suggested to consult with professional background check service company with proven track record in Vietnam to help with the local service.

Risk Management in Enterprise

  Risk and manage risk

Conceptually, risk is any uncertainty that may be harmful to the ability to successfully implement the business objectives of the enterprise. Businesses can identify potential risks to manage them. Fully understood, risk management is a process of a comprehensive review of the business operations to identify potential risks that may impact adversely to the operational aspects of the business. Based on that, the response solutions will be given corresponding to each risk. We can also understand that the risk management process is a process that is organized in a formal way and ongoing to determine, control and report the risks that can affect the achievement of the business objectives of the enterprise.

Requirements for operational risk management

To ensure that risk management activities are carried out as planned, the implementation must ensure the following requirements:

• Raising awareness about the risks as well as the ability to cope with risks appropriately throughout the enterprise;

• Formalize the process of risk management;

• Develop unified risk management processes in the enterprise;

• Transparency risks;

• Including risk management process as part of the internal control system;

In fact, well organized and efficient risk management activities will contribute to add value to the enterprise, specifically:

• Help improving operational efficiency and create competitive advantage;

• Contribute to the allocation and efficient use of corporate resources;

• Minimize errors in all aspects of business operations...

Recently, with the powerful impact of high inflation rate and economic recession caused by the global financial crisis to enterprises, people are concerning more about risk management activities. Many experts believe that well organized and effective operated risk management system will help businesses withstand and overcome fluctuations.

However, how to organize a complete risk management system is the fact that not many businesses are well understood. The worrying thing is many businesses supposing that with the use of insurance services, their businesses are making adequate risk management. That is completely incorrect.

Risk management policies and implementation

To establish risk management systems, enterprises should start from the development of risk management policy. This policy will define the approaching and managing of risk. In addition, risk management policies will clearly defined responsibilities for risk management throughout the enterprise to Board of Directors; The subordinate units; Departments; Risk management department (if any); the internal audit department - internal control. The implementation of risk management activities should be tied to business strategy, annual budget plan and the business cycle in the enterprise.

Risk Management Process

Basically, risk management processes typically include basic steps such as: confirmation of the business objectives, identify risks, description and classification of risk, assessment and risk ratings, response planning development, reporting an update on implementation, monitoring the process of implementation, review and improvement of risk management processes. Details of some of the main steps in the risk management process are as follows:

Confirmation of business objectives

Risk management activities are organized and implemented towards ensuring the successful implementation of the enterprise objectives. Therefore, at the begining the risk management process, the first task that business leaders need to do is confirming the operational goals of the business. This will be the base to ensure that risk management activities are held in the right direction.

Identify Risks

There are many methods to identify risk. Each method has different advantages and disadvantages. However, the following methods are considered using to determine the risk:

• Organize risk assessment workshop;
• Organize "Brain Attack" meeting;
• Questionnaire;
• Audit and inspection;
• Based on industry norms;
• Situation analysis

In fact, the method of determining risk that are used most in organizations is organizing risk assessment workshop. Attending the workshop are the Board of Directors and leaders of all departments. Members at the workshop will exchange information to give a list of business risks. In many cases, the result of the risk identification process is a long list of potential risks. However, this should not be too worried, the implementation of the next steps of the risk management process will help identify clearly the risks that are really the great risk to enterprises.

Description and classification of risk

After identifying potential risks, the next step is to describe briefly but specifically about the origin, cause, consequence and impact of each risks to the enterprise.

Next, we will implement the risk classification. There are many different types of potential risks for enterprises. They can originate inside or outside the enterprise. Based on the nature of the risk, they are many way to classify risk. However, the most common way is to classify risk into 4 groups as follows:

• Financial risk: interest rate, exchange rate, credit source, cash flow and ability to pay...;
• Strategic risk: competition, customer changes, industry changes, risks for research and development activities, intellectual property...;
• Operational risk: the leaders, corporate culture, violation of management rules, financial control, information systems...;
• Dangerous risk: environmental risks, supplier, natural disaster, risks for assets, contracts, products and services...

The classification of risks as above will help enterprises to manage risk in a systematic way.

Assessment and risk rating

Enterprise resources are limited while the number of the risks is great. So, the next step is to organize, evaluate and ranking risks according to priority level of response. Enterprises will analyze, evaluate each risk according to two criteria: the possibility of risk and the extent of the risks affecting the business if happened. The risk that the businesses need to prioritize response and prevent is the risk with high likelihood and degree of influence.

Develop response plans

Develop response plans is an important stage in the process of risk management. At this stage, enterprise should given the preventive measures and specific control should be taken to prevent and minimize damage if the risk occurs. There are 3 contents that must be determined for each specific risk when developing response plans:

1. Measures that should be implemented to prevent risks;
2. The completion deadline for those measures;
3. The person that responsible for managing that risk.

Monitoring the implementation of measures

In the process of implementation of response measures, businesses need to build a system of reporting regularly to ensure strict control of the implementation process. Enterprises also need to ensure that all shortcomings in the implementation of risk control measures must be timely reporting to leaders.

At the same time, business leaders must also build a culture of risk management to every staffs in the enterprise. It is high time that the corporate governance should seriously view the role of risk management activities, consider setting up and maintaining a risk management system in business. Practical experience shows that, once the risks are forecasted, enterprises can fully develop and deploy effective response plans for sustainable development.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Why Binh Duong – Highlight of Attracting FDI

  Binh Duong is a potential destination in Vietnam for foreign corporation to set-up business and manufacturing facility.

According to the latest data of the Department of Planning and Investment of Binh Duong Province, in the first 11 months of 2015, this province has attracted 1.823 billion USD FDI capitals, reaching 182% of the annual plan, increase by 19% over the same period in 2014. With this result, Binh Duong occupies the 4^th position in the country in attracting FDI and continues to assert as a "hot address" in attracting investment in the Southern key economic zone.

Most recently, in November 2015, Binh Duong province has granted the investment registration certificate for the project Kocham Tower with a total investment of 2 million USD to build the office building, culture school, Korean cuisine restaurant... This project comes from the idea of Association of Korean businesses in Binh Duong in which they want to have working place near the company’s factory and the provincial government then they can proposed opinions to tackle the problem.

In the spirit of creating the most favorable conditions for business and investors, the provincial authorities have flexibility in approving the project. The project was granted an area of 1,500 m2 in Binh Duong New City and Korean businesses has also promised to quickly organize funds and complete the project in the shortest time.

In the period 2010 - 2015, FDI attraction of Binh Duong has developed rapidly, with an additional of 879 FDI projects with a total investment of over 8 billion USD. So far, in Binh Duong, there are 2567 FDI projects with total registered capital of 22.244 billion USD from 40 countries and territories. In particular, investment in industrial parks is 1,523 projects with a total investment of 13.972 billion USD, accounting for 62.8% of total FDI capital in the province.

In recent years, Binh Duong province has actively building programs, promotion, investment attraction; timely solution to remove difficulties and obstacles in the process of implementing the project has created confidence for investors; focusing resources on promoting the construction of infrastructure, especially transport infrastructure; improve the investment environment, implementation of administrative reform to enhance the competitiveness of the province.

Binh Duong has 2 billion-USD-project, all of them are in the field of real estate. About attracting FDI, Binh Duong encourages investment in fields as high-tech, supporting industry, attracting large-scale projects, joining the global production chain.

Immediately before and after the TPP was signed, there was a wave of FDI enterprises coming to Binh Duong seeking investment opportunities and quickly making decisions.

According to information from leaders of Polytex Far Eastern VN (Taiwan), this enterprise is licensed for their 274 million USD project at Bau Bang Industrial Zone in 2015. They admitted to set-up factory in Vietnam to catch the opportunities from TPP and implement the trend to move factories from China, Taiwan to Vietnam.

The Vietnam market is very potential, especially the opportunities after joining the TPP. Therefore, in the future, many foreign enterprises will continue to expand their scale.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Foreign Capital Poured Strongly into Ho Chi Minh City

  It has been reported the foreign direct investment (FDI) is strong up to the end of August 2015.  The trend of foreign investors relocating manufacturing site to Vietnam, build factory, and make direct investment through setting up company or business venture has been progressively realized thanks to Vietnam's policy welcoming FDI and the uncertainties of China.

There are 249 newly registered projects in the form of 100% foreign investment capital, reaching USD 744 million; 78 joint venture projects reaching USD 1,573.6 million.

In terms of investment sector, Vietnam real estate sector topped in the capital pouring in Ho Chi Minh City of Vietnam with 5 projects and the capital reached USD 1,428.4 million, accounting for 61.6% of total newly registered capital, 41 industrial projects with USD 585.7 million (25.3%).  In the third place is the financial and service sector with 90 projects and USD 116 million investment capital (5%); education and training with 8 projects at USD 71.3 million investment capital (3.1%); 53 information and communication projects at 20 million USD investment capital; 17 transport and warehouse projects...

The demographic of investors are diverse.  There are 35 countries and territories having investment projects in Ho Chi Minh City. In particular, United Kingdom following the recent visit of British Prime Minister has 5 projects with investment capital of USD 1,201.4 million (accounting for 51.8% of total investment in Ho Chi Minh City); British Virgin Islands have 7 projects, at USD 306.5 million investment capital (13.2%); South Korea with 71 projects, at USD 232.8 million investment capital (10%); Singapore has 52 projects with USD 107.6 million investment capital (4.6%); Japan has 57 projects, investment capital of 29.9 million USD; Hong Kong has 13 projects, investment capital of 47.8 million USD (2.1%).

We, ANT Consulting company, support you with the service of set up a company in Vietnam, Risk management in Vietnam, Employee background check in Vietnam... to help you shorten the implementation time.

WSJ: “Made in Vietnam” Goods will Soon Popular Globally

  Numerous foreign investors relocating factorties to Long An (Vietnam) to set up business and take advantage of young and low cost workforce.

This province has a dozen industrial zones. As of May 2015, they have attracted 3.67 billion USD foreign investments, 40% of which is poured into textiles sector.

The economists said that this process could accelerate if the Trans-Pacific Partnership agreement (TPP) is agreed. This agreement will reduce import tariffs on many goods exchanged between member states, mainly to benefit the developing country like Vietnam or Malaysia - countries where growth rate depends heavily on exports.

Wages soared and labor shortages in China are making Vietnam become more attractive. Last year, FDI into Vietnam have reached 12.4 billion USD, increase by nearly 25% compared to 2009. One of the largest investors as Samsung Electronics of South Korea whom have plan to double investment in electronics manufacturing in Vietnam.

If TPP takes effect, Vietnam economy will be the biggest beneficiaries because this country has more opportunities to access the large consumer market. TPP will give member countries privileged access to the US and Japan.

The Government of Vietnam is estimated that TPP could bring the economy 33.5 billion USD over the next decade, equivalent to a fifth of current GDP. The export turnover of the main industries, such as textiles and footwear, will increase by 46% to 165 billion USD in 2025 due to tax-free imports into other countries.

In Long An, the 3-storey factory of Avery Dennison is preparing for the influx of orders on clothing labels and price tags. Dozens of concrete houses for workers are also being built - a signal that many other manufacturers are also coming here.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Vietnam Prepares for Wave of Russian Tourist

  Vietnam is preparing to welcome waves of Russian to enter Vietnam tourism market, set up tour operator company and also conduct M&A activity in tourism industry.

Currently, there were complicated situations occurred in the favorite destinations of Russian tourists such as Egypt, Turkey and Goa of India, the Russian Government recommend, forbid or even stop the tours and flights to these destinations. Vietnam, Cuba and China have been recommended as safe destinations for Russian citizens to travel.

The A321 of Kogalymavia Airlines (Russia) had an accident in the Sinai Peninsula (Egypt) on October 31^st killed 224 people on the flight. The Security Agency of the Russian Federation determined that this is a terrorist attack after finding traces of explosives in the debris. Soon after, Russian President Vladimir Putin ordered the suspension of all flights from Russia to Egypt.

On November 11^th, Russia officially banned all aircraft of the national airline of Egypt (Egypt Air) and advised their citizens should not come here. This led the Egyptian tourism industry hit hard. According to Al-Ahram newspaper in Arabic of Egypt, there were 72,000 Russian tourists have left this country after the tragedy. Egyptian Tourism Minister predicted that in the last 3 months of 2015, their tourism industry could suffer over 820 million USD losses.

Goa, a state in India is the favorite destination of Russians in the new year holiday continues to go to "blacklist" due to threats to local security problems as well as the increase in prices at tourist sites.

The crisis started in 2014 when the Ruble devaluation, the number of Russian tourists travel to Goa halved. The number of 2016 will continue to decline. The negative impacts caused Transaero Airlines, which often serving 50% of guests are Russians goes bankruptcy. According to statistics, Russian tourists accounted for nearly 50% of foreign visitors to Goa, with nearly 250,000 visitors in 2013.

According to the Wall Street Journal, the House of Russia published a list of the safe destinations, which encouraging its citizens to come after a series of favorite destinations are included in the "blacklist". In the three alternative candidates, there was Vietnam.

At the Russia – Vietnam business forum occurred last November in Moscow, Russia suggested that Vietnam should prepare to welcome waves of tourist to come here after many difficulties in Egypt. Moreover, Vietnam should improve the mechanisms to support the Russian tour operators to enter the Vietnam tour market.

This is good sign for Vietnam's tourism industry after the number of Russian tourists has reduced from the end of 2014 due to the Ruble devaluation causing them to tighten spending. According to the Vietnam National Administration of Tourism, as of November 2015, there are 297,384 Russian visitors come to Vietnam, reached only 90% compared to the same period last year. However, from October, the number of Russian arrivals to Vietnam has increased slightly.

The high season of Russian for traditional wintering lasts from October to the end of March next year. Therefore, it is time for Vietnam to attract the large number of tourists coming from Russia. Moreover, it is particularly advantageous in the context of many favorite destinations of the Russian are no longer safe and Vietnam is recommended by the Russian Government.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

FDI Capital Pouring to Binh Duong Province

  Binh Duong province of Vietnam has marked early success in attracting investment with large projects licensed in setting up business, mainly in manufacturing.

On October 23^rd, 2015 the Provincial People's Committee of Binh Duong has just granted the investment certificate phase 3 of 2015 for 38 enterprises with foreign direct investment (FDI). Total capital reaches nearly 532 million USD, bringing the total FDI capital into this province in 10 months to 1.63 billion USD, increase by 40% compared to the same period in 2014.

Also at the ceremony, the Provincial People's Committee of Binh Duong has witnessed the signing of the lease 80 hectares of land in Bau Bang Industrial Zone to deploy factories specialized in manufacturing bicycles of Active International VN Company (Taiwan).

This is a large-scale projects, concentrating 45-60 enterprises specialized in manufacturing bicycles with total investment of 200-250 million USD, which is expecting to create more than 8,000 jobs.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Numerous Furniture Companies Moved from Indonesia to Vietnam

  Since early 2015, there were 6 foreign furniture companies moved their factories from Indonesia to Vietnam.

There is a large furniture company invested by Taiwan in Sidoarjo - East Java has decided to move their factory to Vietnam. This company was started dismantling and will move in early 2016.

Companies from Taiwan have been operating for 3 years in Indonesia then want to switch to manufacturing in Vietnam because of the labor cost and the minimum wage. The minimum wage in Vietnam has increased by 150% in the past 3 years. After considering the costs, they decided to move to Vietnam to operate more efficiently. Moreover, manufacturing in Vietnam is 35% more efficient than in Indonesia.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Signing of TPP in 2016 Will Promote FDI into Vietnam

  The investment flow will be strong into Vietnam for setting up company, factory once the commitments in the TPP agreement takes effect.

The Trans-Pacific Partnership (TPP) agreement will be signed on February 4^th 2016 in New Zealand. In order to capture the opportunities that it will bring, many foreign companies have invested in Vietnam.

The parties have also agreed to a term of 2 years for national parliaments to ratify the agreement. Thus, the TPP can be effective in 2018.

12 members of TPP include: US, Japan, Vietnam, Australia, Brunei, Chile, Malaysia, Mexico, New Zealand, Canada, Peru and Singapore. The current country members of TPP accounted for 40% of the world GDP and 26% of global trade merchandise. The agreement will not be effective without the participation of both the US and Japan.

To this point, it is probably not debatable about the opportunities that the TPP brings to Vietnam, especially in trade development and investment attraction. When the trade is opened thanks to the commitment to eliminate tariff barriers between the 12 country members, it will impact to investment, not only in internal, but also from other investment markets.

Manufacturing Companies Set-up Business in Vietnam

HanesBrands (NYSE: HBI), US’s leading textile corporation has recently announced raising total investment in Vietnam market to nearly 55 million USD, increase by more than 11 million USD compared to 2014. After 8 years of operation in Vietnam, they have 3 factories located in Hung Yen and Hue.

HanesBrands is not the only business that can see these opportunities in Vietnam when the TPP was signed. Many large enterprises of textile industry have decided to expand investment in Vietnam to capture the opportunities brought by the TPP.

And it is not only the textile industry, there are a lot of examples to prove that foreign investors are looking at Vietnam as a tremendous opportunity to invest in. The appearance of high-tech giants such as Samsung, LG, Microsoft, Jabil... with investment capital of up to tens of billions USD, of which only the capital of Samsung has reached over 14 billion USD is the clearest evidence. The presence and moreover the expansion of the foreign retail giants such as Aeon, Auchan, Metro Cash & Carry, Big C, Lotte... are also the typical examples. More than 290 billion USD of FDI capital has been committed to pour into Vietnam during the past years.

According to Nikkei news agency, Pou Chen Company, which is the world’s largest footwear manufacturer, specializing in providing goods for two famous brands that are Nike, Adidas and many other major brands, are planning to move their factories to Vietnam to take advantage of TPP.

By the end of September 2015, the number of footwear manufacturing by Pou Chen in Vietnam accounted for 42%, increase by 39% compared to the same period in 2014. The total annual production of Pou Chen (headquartered in Taiwan) is more than 300 million pairs of footwear, sales from footwear and garment accounted for 75% of total revenues of the company.

According to the representative of Pou Chen, the company has gradually shifted production bases to Vietnam since 2012 as the labor costs in China are rising rapidly in recent years. They see the long-term stability in Vietnam in both economic and politics.

Pou Chen is not the only company that moving production bases to Vietnam. Currently, many Taiwanese companies are actively investing in Vietnam, including competitor of Pou Chen that is Feng Tay (over 50% of Feng Tay’s production is concentrated in Vietnam).

Besides, Far Eastern New Century Company (FENC) has also planned to pour 307 million USD to a new factory in Vietnam in June 2015 and is expected to start production in the second half of 2016.

It is clear that footwear suppliers are actively moving their factories to Vietnam to capture the opportunities that the TPP will bring. Once the TPP is approved, the goods from the members in TPP export to the US market will enjoy preferential tariffs. As a result, the famous international brands like Nike and Adidas will prefer Vietnam as the location of their factory.

In this context, the TPP would be a "catalyst" for this capital flow to flow stronger. The catalyst is not just come from the opportunity of an open trade market, but also from the commitments of the TPP members relating to investment.

According to Mr. Hoang Manh Phuong, Deputy Director of Legal Affairs (Ministry of Planning and Investment) - the one who participating in the TPP’s negotiating session related to investment - said that there are a lot of commitments bringing big advantages for foreign investors in Vietnam. TPP allows investors to invest and do business in all sectors, except the one that is still in the reserved category.

Lotte Wants to Open 60 Supermarkets in Vietnam

  Vietnam's retail market has the highest growth rate in the region, therefore Lotte expects to grow further through setting up more retail business or M&A activity in Vietnam.

South Korea is the largest investor in Vietnam with over 4,000 enterprises, total investment in Vietnam as of July 2015 is 32.8 billion USD.

Among South Korean firms investing in Vietnam, Lotte Mart is one of the corporations with the most powerful investment force and they are leading in a number of areas with the models of retail, hotel, cinema...

Mr. Hong Won Sik, CEO of Lotte Mart Vietnam said that Vietnam's retail market has the highest growth rate in the region, therefore Lotte wants to invest more. The target is to open 60 supermarkets till 2020 and now they have opened 11 supermarkets in Vietnam.

Some of the current Lotte shopping centers have made a big impression on Vietnam consumers and the investment from Lottle makes it to be one of the biggest players on the retail landscape in Vietnam.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Vietnamese Restaurant Chain Attracts Foreign Funds

  To meet the demand of growing of young consumer, the food and beverage services in Vietnam have been attracting investment in setting up business, M&A activity.

The Vietnam business community recently is not out of surprise when a series of Vietnamese restaurant chains are invested by famous overseas funds with millions of USD.

The start-up project with the restaurant chain named “Kafe Group” by Chi Anh Dao, a female chef and businesswoman born in 1984 has just got the attention by receiving an investment amount of 5.5 million USD (over 120 billion VND) from Cassia Investments - an investment fund from Hong Kong (China).

Previously at the end of 2014, the chain of 100 restaurants named “Mon Hue” (Hue Dishes) of Huy Vietnam Food Processing Co., Ltd has been invested by Franklin Templeton fund, a fund managed by billionaire Mark Mobius with 11 million USD investment capitals.

According to the owner of “Mon Hue” restaurant, this food chain also receives investment capital from 4 other investors from Singapore, Hong Kong (China)... Currently, this chain includes 3 brands: Mon Hue, Rice Express and Mr. Hung Noodles.

Before KAfe Group and Huy Vietnam, Golden Gate – including such brands as Kichi Kichi, Sumo BBQ, Ashima, Vuvuzela... received the investment flow with 2.6 million USD from Mekong Capital Fund in 2009. Next, Standard Chartered Private Equity Fund from Standard Chartered Bank has spent 35 million USD to repurchase these shares.

Besides buying shares of Vietnam companies, the culinary market has continuously welcome many foreign brands opening restaurant in Vietnam such as Tokyo Deli, Coca Suki, Sakura, Oshima...

According to experts, investing in culinary market is the trend of modern business model. In particular, food chains seem to be less affected by the economic downturn as they meet the indispensable needs of life. Therefore, this food and beverage service sector in Vietnam is always attractive to funds.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

M&A in Vietnam: Strong Flow from Thailand

  It is expected to have a strong capital flow from Thailand to Vietnam in the coming time to through M&A activities.

According to a research, the main trend of the M&A market Vietnam in the period of 2015 - 2016 and subsequent years have been focusing on some key sectors: retail, consumer goods, real estate, finance - banking. Notably, in the coming time, investors from Thailand will become "dual key" in its role as the acquisition of the project, and incorporation in Vietnam.

Not until now, it has been realized that Thai is serious rival in the M&A market. From the period of 2010 - 2011 till now, the Thai people through their corporations like Charoen Pokphand, TCC Group, PTT, Siam Cement (SCG), BJC, Central Group... by the way of M&A or direct investment have quietly entered in  Vietnam’s retailing, building materials, gas sectors.

M&A Trend from Thai Investors in Vietnam

In 2012, SCG has spent 240 million USD to acquire 85% stake in Prime Group. Currently, SCG has nearly 20 subsidiaries and associated companies in Vietnam. As of June 30^th 2015, the total asset value of SCG in Vietnam reached approximately 716 million USD... In the next 5 years, SCG will spend 6-8 billion USD for countries in the region, in which a large part will be poured into Vietnam.

At the end of 2014, Berli Jucker Pcl (BJC) announced to spend 879 million USD to acquire Metro Cash & Carry Vietnam. Earlier, in 2013, BJC has acquired 60 stores of Family Mart and buy 65% ​​stake in Thai An Group, who owns a network of 200 distributors, 2,500 wholesalers and thousands of retailers in traditional markets.

In 2014, F&N Dairy Investments Pte Ltd (F&N), a subsidiary of BJC bought shares of Vinamilk, raising the percentage of ownership in Vinamilk to 11.04%, reaching a value of about 591 million USD. The owner of BJC also offered to hold 40% stake in Sabeco and pricing SABECO at approximately 2.4 billion USD.

In addition, the Central Group through its subsidiaries - Power Buy bought 49% stake in NKT technology development and new solution JSC – the owner of Nguyen Kim Trading Company, which was priced at 200 million USD.

According to a statistics from HSBC Thailand, the Thai companies were involved in at least 377 projects in Vietnam with a total registered capital of 6.7 billion USD, becoming the 10^th largest investors in Vietnam market and their ranking are improved quickly. In particular, Vietnam and Thailand have set a target of raising bilateral trade to 15 billion USD by 2020.

The M&A trend of Thai corporations are clearly showed in 2014 - 2015 with the typical deals of PowerBuy - Nguyen Kim and BJC - Metro. Through M&A activities in the retail sector, Thai investors want to reach and grasp the distribution market of Vietnam.

M&A in Retail, Consumer Goods, and Distribution Services in Vietnam

The areas interested by Thai investors from 2011 to now are the retail and consumer goods sectors. The reason is Vietnam is a vast potential market for the retail sector and consumers goods. According to the research from Statista (Germany), Vietnam's retail market sales could reach 100 billion USD/year in 2016.

The wave of M&A from Thai investors to acquire retail and consumer goods sector are to capture the opportunities when Vietnam participated in the agreements of free trade, as well as the formation of the ASEAN Economic Community (AEC) at the end of 2015.

Thai investors are increasingly buying supermarket chains, making every effort to catch the opportunities brought by AEC when Thailand goods imported into Vietnam with the tax rate equal 0%.

According to CEO of HSBC in Vietnam, in the next 5 years, major corporations of Thailand will turn Vietnam into a production center for re-export of Thai products to other countries because Vietnam has a cheap and skilled labor force.

It can be seen that Vietnam has welcomed a strong capital flow coming from large corporations of Thailand with fast and powerful acquisition speed. Thai investors show no sign of stopage. In addition to the retail and consumer goods sectors, some other sectors are also getting the attention of investors from Thailand as oil and gas, infrastructure, transportation, agriculture...

These signals indicate that Vietnam is still an attractive destination for the capital inflow from Thailand. In the short term, M&A market will continue to witness the M&A activities that Thai investors continued to act as the purchaser.  M&A due diligence assessment on Vietnam targets will be needed to ensure the success post-merger intergration.

U.S Company Plan to Invest in Vietnam’s Railway Infrastructure

  At the meeting with the Vietnam Railway Corporation on September 21^st, the National Standard Finance - NFS has proposed investment plans to create large-scale infrastructure assets with investment value of up to 2 billion USD/transaction. The investment models could be: PPP, DBFOT, DBOT or BOT...

Two important tasks that must be performed by the Vietnam Railway Corporation from now until 2020 are to modernize the existing railway lines, along with construction and investment the new railway lines. The Corporation is mobilizing resources for investment in railways. Therefore, the potential of NSF is highly appreciated and hope that the two sides could promote the exchange of specific information on the project to guide plans for cooperation and forms of investment to modernize and develop the railway of Vietnam.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

TPP Helps Vietnam Become an Important Base in The World Production Chain

  Vietnam is considered to be the biggest beneficiary country of the 12 countries participating in the TPP.

The fact that countries which have large markets like the US, Japan and Canada reducing import tax to 0% for Vietnam goods will create tremendous boost to export of Vietnam. Particularly the textile industry, turnover could increase significantly.

The textile and footwear industries, the agricultural, forestry and fishery goods of Vietnam will have the opportunity to increase export significantly.

Joining TPP will also help Vietnam and other countries to have new opportunities from new supply chain, which will be formed after TPP takes effect. TPP countries currently account for 40% of global GDP and 30% of global trade. Moreover, it includes major markets such as USA, Japan which will certainly open up many opportunities when the new supply chain formed.

Accordingly, a number of corporations and large companies in the world have considered investing in Vietnam with the goal of making Vietnam become one of the important bases in their production chain. Joining TPP will help this trend grow stronger, which is an important condition for Vietnam to step on stage to develop new industries with higher technological contents.

The commitments in TPP in service and investment are also expected to have a positive effect in improving the investment environment, contribute to attracting foreign investment. Many studies confirm that foreign investment will increase as TPP takes effect.

The Ministry of Industry and Trade said that Vietnam enterprises will also can join into the public procurement market in the United States, Japan, Canada... According to the data from the US, the market for public procurement of this country is about 10-12 billion USD each year. This is an attractive distribution channel for export goods from Vietnam.

The completion and strengthening the protection of intellectual property rights will open opportunities to attract investment in sectors with high knowledge content, such as pharmaceutical manufacturing, including bio-medicine and especially vaccine.

TPP will create condition for enhancing growth, creating job and increasing income, contributing to poverty alleviation, improving the quality of human resources and health care for the community.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

FDI Wave from the UK into Ho Chi Minh City

  UK businesses are gradually becoming the largest investors in Vietnam.

The southern key industrial zone (SKEZ) including Ho Chi Minh City (HCMC) and neighboring provinces such as Binh Duong, Dong Nai, Long An and Ba Ria - Vung Tau.

SKEZ include 106 active industrial zones with a total area of 33,500ha. Those industrial parks have the advantage that lie near the highway, intercity road, seaport and international airport.

HCMC is the economic center of SKEZ, therefore this is the area that always receives the largest amount of FDI projects.

According to Savills Vietnam, in the first half of 2015, UK businesses have invested the most in HCMC, accounted for 59% of total FDI capitals, followed by investors from the British Virgin Islands (15%) and South Korea ranks 3^rd (10%).

HCMC has 16 active industrial parks, operating with 2,300ha leased land, attracted 425 million USD from FDI, increase by 50% compared with 2014.

Currently, HCMC has announced plans to open 7 new industrial parks, with a total area of around 2,000 ha to welcome FDI inflows in the textile, service and food processing industries.

Moreover, in recent years, HCMC has adopted preferential tax policies to encourage new businesses operating in the high-tech industry and related scientific disciplines.

Especially in infrastructure development, in order to welcome foreign investors, infrastructure of the city has been growing rapidly with many underway projects, such as the HCMC - Long Thanh highway, the metro 1 and the belt roads of the city.

In early 2016, two key roads will begin construction includes the belt road no.3 connecting Nhon Trach District, Dong Nai and Ben Luc - Long Thanh highway.

We, ANT Consulting company, support you with the service of set up a company in Vietnam, Risk management in Vietnam, Employee background check in Vietnam... to help you shorten the implementation time.

Vietnam: The Potential Destination for Venture Capitals

  If we see the business, the attention of Venture Capitals (VCs) and foreign investors are the indication then Vietnam is emerging as a potential environment for the startup operation.

Besides the investment funds that have been presented in Vietnam as IDG Ventures Vietnam, a number of new VCs have joined the Vietnam entrepreneurship ecosystem and are very optimistic about the ahead opportunities.

On August 2015, the Captii Ventures owned by Captii Corporation has invested a sum of 6 numbers to the startup OnOnPay phone recharge. This represents the first venture investment of Captii in Vietnam.

Factors attracting investors here are the demographic advantages and business models that can be replicated. According to Techlist.asia, the startup figure in Vietnam has risen to 1,400, bringing this country becomes the 3^rd largest startup ecosystem in Southeast Asia after Singapore and Indonesia.

With a population of 90 million people who are in the process of economic growth, young population structure, emerging middle class and the rate of Internet user is increasing rapidly, especially mobile phone, Vietnam is in the beginning phase of a very exciting cycle.

Moreover, Vietnam is a large, young and growing rapidly economy, the technology index such as the ratio of using the Internet and smart phone are in large-scale, the leading founder generation have achieved success and demonstrate the potential of the talent and market of Vietnam.

Compared to other Southeast Asian countries (Indonesia, Thailand, Malaysia, Singapore, Philippines and Vietnam), Vietnam has strong advantages in the available technique human resources, energy, resources and potential growth the market.

Moreover, the new policy on foreign investment has entered into force on July 1^st 2015 with more freedom for foreigners to own real estate in Vietnam and simpler procedures for projects or portfolios.

In the 3 areas that Captii Ventures is focusing on that are market, digital media and apps for business, they will participate more actively in at least two areas that are market and apps for business.

Not only with the VCs, Vietnam startup is also attractive to other foreign companies such as Yello Mobile from South Korea, the company has invested in CleverAds advertising company and Websosanh - the price comparison site.
Garena, a Singapore’s internet company has invested Series B for Foody, startup locations that in the same month continued to receive Series C investment from Tiger Global Management - US venture capital fund.

Transcosmos, a software manufacturing company based in Tokyo, had previously acquired a 30% stake in Hotdeal e-commerce platform in a deal signed on August 2015.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

TPP Will Create Breakthrough for Vietnam’s Commercial Real Estate Sector

  On October 5^th, the TPP agreement has finished negotiation. According to experts, the signing of TPP will expand the opportunity for Vietnam's economy in general and real estate market in particular.

It seems that foreign real estate investors are more sensitive hearing than domestic investors in the anticipation of macroeconomic policy. The most recent example, funds from Japan and the United States are massively investing in the real estate market of Vietnam. These includes Creed Group (Japan) committed to invest 200 million USD into the An Gia Investment or the Global Emerging Market - GEM (US) has recently committed to pour 20 million USD into Hoang Quan real estate company.

Currently, there is a capital inflow from Japan landing in Vietnam. Many Japanese firms have invested in clean agriculture in Japan and some areas in the Northern of Vietnam to grow fresh vegetables and then export back to Japan. The Japanese are very closely following the TPP negotiation process so they also have investment plans in advance.

After the TPP was signed then what people expect the most is the commercial real estate market will develop better, which include industrial park, office, retail space...as a result of the shift of investment capital flows.

In order to leverage the special tax incentives and cheap labor cost in Vietnam, a lot of businesses in Japan, US had planned about moving factories from China to Vietnam and exported to Japan, US... The main industries that are shifting include textiles, phone manufacturers, automobile manufacturers.... The capital flow shifting will push up demand for commercial real estate.

When the foreign enterprises arrived in Vietnam, they will have to build factories, warehouses. On the other hand, they would create jobs, generate demand for ancillary and service industries. Thus, the system of services like hotels, trade centers, office rental and other services will develop as a result.

Thus, we can also expect M&A in the field of hotel, office, retail, including resort real estate will thrive in the future. Moreover, after the success of TPP, it will push up the industrial real estate market to develop.

We, ANT Consulting company, support you with the service of set up a company in Vietnam, Risk management in Vietnam, Employee background check in Vietnam... to help you shorten the implementation time.

Will Vietnam Become The Silicon Valley of South East Asia?

  15 years ago, it was hard to find an information technology (IT) company in Vietnam, but now there are nearly 14,000 IT enterprises that produce and develop hardware, software and digital. The Government of Vietnam considered high-tech industry as one of the pillars to promote economic growth of the country. Vietnam has invested heavily in the construction of infrastructure and adopts economic policies to encourage both domestic and foreign enterprises to invest and do business in Vietnam.

Besides, Vietnam has more than 90 million in population with average age of over 30 years old, in which the number of programmers, engineers, young entrepreneurs and students are increasing, that will be the effort to promote economic growth and technological innovation in the country.

More than 20 years ago, the leading technology corporation IBM has opened an office in Da Nang in 1992 and then opened in Hanoi, Ho Chi Minh City in 1994. Also in 2012, Da Nang was recognized by IBM as one of 33 most dynamic cities in the world and was awarded by the company with 50 million USD under the program to support the improvement of infrastructure in three years time.

Many hi-tech parks are established under the IT projects of Vietnam in 2020 that has been responsive to the growing demand for infrastructure for hardware manufacturing, companies producing software and international information technology... This is giving the central city of Vietnam strength to become a center of high-tech boom.

Moreover, three largest IT universities in Vietnam (that are located in Hanoi, Da Nang and Ho Chi Minh City) are the main workforce for the high-tech zone with hundreds of IT students graduating each year. Many young engineers were recruited immediately to famous companies such as Cisco, Fujitsu, HP, IBM, Intel, LG, Samsung, Sony and Toshiba.

In October 2015, the Vietnam IT Conference will be held in Ho Chi Minh City with the attendance of representatives from 150 multinational IT companies, along with more than 200 IT companies from Vietnam and 20 universities. There will be speeches from Gartner, KPMG, HP, LogiGear, Microsoft, Samsung. This is the chance for Vietnam IT industry to present to the world and everyone will witness the boom of the Vietnam IT industry.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Can Vietnam Become a New Production Center of The World?

  Vietnam now is a machining and production center, just behind Singapore on the total investment amount of China.

China is following the model of the Japanese economy and then has higher production costs. Therefore, Chinese enterprises are now diverting into neighboring countries to find the location for new manufacturing facilities.

With great potential for growth, young population structure and lower wage costs, Vietnam will benefit from the development of infrastructure associated with competition for positions in regional influence between China and other major economies.

This is an opportunity for Vietnam to improve its position in the value chain by becoming a global center of production of low-value commodities.

To enhance accessing to investment capitals, becoming a center of manufacturing, global outsourcing and enhancing the position in the value chain, in the long term, Vietnam will actively screening the list of projects FDI under the strategy and development-oriented by the Government.

Vietnam needs to invest in education and training to develop workforce skills. In addition, Vietnam also needs to focus more on investment in environmental infrastructure, especially in transportation and services.

Along with the continuous integration in ASEAN and by the importance of this region for the 4 largest economies in the world, Vietnam has many advantages to attract multinational companies to invest in order to take use existing opportunities of Southeast Asia area.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.