(VEN) - In 2010, Vietnam and the US will celebrate the 15th anniversary of the normalization of bilateral relations. This important event will contribute to promoting Vietnam-US cooperation for sustainable development. US investors are becoming increasingly interested in the Southeast Asian region and pay special attention to Vietnam.
The US is the third largest trade partner and the biggest export market of Vietnam. Both sides have benefited from bilateral trade relations. In 2007, trade between Vietnam and the US totaled US$12.53 billion and that increased to more than US$14.50 billion in 2008. In 2009, of the 43 countries and territories investing in Vietnam, the US became the largest foreign investor in Vietnam with total registered investment capital of US$9.8 billion. The US takes the lead in terms of the disbursement rate of foreign investment in Vietnam, 47 percent (Chinese Taipei 39 percent, the Republic of Korea 36 percent, and Japan 28 percent). US investment in Vietnam concentrates on services, especially tourism and hotel services. Examples include the project of the Starbay Group in Hoi An and the five-star hotel project of the Good Choice Group in Ba Ria - Vung Tau. Coca Cola has also stated that it will invest an additional US$200 million in Vietnam for the next three years (in the past 15 years Coca Cola has invested US$200 million in three factories in Vietnam). In the near future, negotiations on Vietnam-US Bilateral Investment Agreement will begin and if they are successful, the agreement will attract more US investors to Vietnam.
The American Chamber of Commerce in Vietnam (AmCham) recently said that many US companies have a strategy called 'China plus one' or 'China and India plus one'. Many large companies of the US already have some factories in China and India and they want to have some more factories in countries that are members of the Association of South East Asian Nations (ASEAN), and Vietnam is considered to be the best choice for US investment in ASEAN. The American Chamber of Commerce in China (ACCC) carried out a survey by asking 266 US companies about their 2010 business plans in China. The survey results show that 79 percent of these companies delay or cancel their investment plans in China (in 2009 only 44 percent of the questioned companies gave this answer). US investors are becoming more interested in the Southeast Asian region. Playing the role of ASEAN president in 2010, Vietnam will become more attractive in the eyes of US investors.
Real estate, hotel and tourism are the key infrastructure areas catering to international trade and globalization. Therefore US investment in these fields is always long-term. Some US companies have investment projects in these fields in cooperation with large companies of Vietnam or other Asian countries. Many US companies are the world's leading hotel investors. Vietnam is an emerging market with big opportunities for growth. Foreign companies, especially those operating in the fields of electronic production or auto manufacturing, consider Vietnam as a potential place to build new factories when the world economy recovers.
However, Vietnam still shows some limitations that are of concern for US investors. Christopher Runckel, the chairman of the Runckel Associates, a US consulting company, said that the infrastructure in Vietnam remains poor, land prices in Hanoi and Ho Chi Minh City are expensive, the seaport systems in Vietnam are not as good as those in China or Thailand, supply lines are still limited, labor force circulation and possibilities to access advanced training also remain matters of concern.
The Vietnamese economy is recovering. A bright future with rapid economic growth is what US companies in particular and foreign investors in general are seeking in Vietnam. Vietnam is holding the presidency of ASEAN. The US highly appreciates the role of Vietnam in ASEAN and wishes that Vietnam will help the US strengthen its relations with ASEAN and resolve the pending problems to boost relations with Southeast Asian countries./.
By Mai Phuong
|