Thai newspaper calls for investment in Vietnam

In its article “Don’t turn your back on Vietnam” the news wire said that foreign investment in Vietnam dropped by about a third since September 2011, with some blaming a weakening economy, inflation, high debt, and the fallout from a property market crash.

However, Thai businesses are still interested in investing in Vietnam, a market of approximately 90 consumers, and they believe they will continue to focus on their long-term strategies and creating real value there.

The news wire confirmed that Vietnam will bounce back from its recent difficulties, and more quickly than people think.

There are four key areas that businesses should consider when deciding to invest in this market, according to Bangkok Post.

First, Vietnam is changing:  In the past, corrupt loans to inefficient state- and privately owned companies resulted in a rise in non-performing loans and pressure on the wider economy.  The Vietnamese Government is now taking steps to remedy these problems in the banking sector. 

Second, growth is stable: The current growth rate of around 4 percent is predicted to average out at around 5 percent over the next two years.  This is a sustainable level of growth, and will keep excessive inflation at bay, while also helping Vietnam prepare for the economic integration prompted by the ASEAN Economic Community.

Third, Vietnam is a springboard to opportunity lying just beyond its borders:  Laos and Cambodia are dynamos of growth and Vietnam can provide a gateway for Thai investors wishing to access these markets, directly or through Vietnam subsidiaries.

Last but not least, cost savings: With a glut of overextended Vietnamese companies looking to divest or offload assets, there are bound to be bargains for savvy Thai entrepreneurs looking to expand their operations.  Furthermore, labor costs in Vietnam are significantly lower than in many countries in ASEAN, helping to reduce startup costs.

According to the Thai Consulate in Ho Chi Minh City, Thailand is the 11th largest investor in Vietnam and the third largest among ASEAN members, with total investment value of US$5.9 billion.