CONSULATE GENERAL OF THE SOCIALIST REPUBLIC OF VIET NAM IN MUMBAI, - - PowerPoint PPT Presentation

CONSULATE GENERAL OF THE SOCIALIST REPUBLIC OF VIET NAM IN MUMBAI, THE REPUBLIC OF INDIA

I.

VIETNAM-INDIA ECONOMIC RELATIONS

II.

NEW MOMENTUMS IN VIETNAMES ECONOMY

• III. TRANS-PACIFIC PARTNERSHIP (TPP)
• IV. MOST SUITABLE LOCATIONS FOR

INDIAN ENTERPRISES IN EXPORT- MANUFACTURE FROM VIETNAM TO TPP

V.

CONCLUSION

1.1 Political relations

• Traditional friendship cooperation
• Start of the period of deeper cooperation in

the spirit of strategic partnership

1.2 Economic relations

• Current performance

 India - 20/200 trade partners  Investment projects: India 250; VN: 27  Trade: 8 bn. USD.  Tourism: very small volume (0.3% as

Viet Nam has 7.8 million foreign visitors last year, but from India only 23,000 visitors).

• Planning

 Political: excellerating each side and both

sides.

 Economic: trade up to 15 bn. in 2015.

2.1 Structural reforms or “Renovation Two”

• 1. Achievements
• GDP: $185 bn. in 2014
• 1986 renovation “One”:
• Vietnam’s export: No 1 in black pepper, No 2 in rice

and café. Now exporting smart phones, computer.

1986 2015 200 2200

GDP per capita ($US)

1 245 320 1986 2014 2020

Trade (billion $US)

2.1 Structural reforms or “Renovation Two” (cont.)

• 1. Achievements (cont.)
• FDI: 1987-2014: attracted $255 bn. with 17,520

investment projects from more than 100 countries and territories. FDI brings 25% GDP and 70% export

• f Viet Nam.

Manufactu re 53% Others 26% Real Estate 21%

FDI Distribution

2.1 Structural reforms or “Renovation Two” (cont.)

• 1. Achievements (cont.)
• Trade: 2014 $245 bn. with surplus.

Bloomberg forecasted Vietnam is among 20 countries with surplus 3.5% GDP up in 2015.

Viet Nam (18/75) Russia (19/75) UAE (20/75 China (22/75) US (53/75)

2.1 Structural reforms or “Renovation Two” (cont.)

• 1. Achievements (cont.)
• Vietnam has enjoyed

leading position among ASEAN exporters to US. Exports from ASEAN counrties to US in 2014

Viet Nam, 22% Malaysia, 21.60% Thailand, 19.80% Others, 9.40% Indonesia, 14.70% Singapore, 12.50%

2.1 Structural reforms or “Renovation Two”

(cont.)

2.

Renovation Two

• Heavy effect of global financial crises
• Shifting of growth pattern

Restructuring the economy Reforming the basic laws

Real Estate Law:

1. First time allow foreigners buy houses 2. Limit only in quantity in

• ne community unit.

Corporate Law:

• 1. Freely doing

business in the sectors the Government doesn’t ban

• 2. State-owned

enterprise is 100% capital

• 3. FDI is when 51%

capital

• 4. Ratio of vote in

enterprise decisions downs from 75 to 65% and 65 to 51%.

2.1 Structural reforms or “Renovation Two”

(cont.)

2.

Renovation Two (cont.)

• Advantages VS. Challenges

Advantages i) Favourable location; ii) Good business environment; iii) Cheap production costs (land, electricity, labour).

Challenges

• 1. State-owned

enterprises;

• 2. Bad debts.

2.2 Joining a series of international free trade areas

• Joining 6 new FTAs, while being members of 8

FTAs Vietnam is a member of 8 Free Trade Agreements, including those with ASEAN, ASEAN+ (India, Australia and New Zealand, South Korea, Japan and China), Chile and Japan Viet Nam is under negotiations with 6 new FTAs: ASEAN Economic Community (AEC); EU; Korea; Customs Union with Russia, CERP , TPP

2.2 Joining a series of international free trade areas (cont.)

• Influence of FTAs: change the features and weight
• f Vietnamese economy toward more developed.

TPP brings two most important benefits 1.Low and no tariff; 2.No competition from China

3.1 What and why TPP?

• What is TPP?
• Trans-Pacific Partnership and US-led economic
• rganization

in the Pacific

• Scale: 35%
• f global GDP

and 40% global trade; GDP $28 trillion. US accounts for 57% of TPP .

• 12 countries
• Population: 750

million

• Economic Output:

US$ 28 trillion

3.1 What and why TPP? (cont.)

• What is TPP? (cont.)
• Form: a FTA for 21stcentury with huge

liberation and ease trade, investment, labour and public expenditure.

• 12 countries
• Population: 750

million

• Economic Output:

US$ 28 trillion

3.1 What and why TPP? (cont.)

• Why is TPP?

 Europe is aging, Euro-zone crises, while

Asia-Pacific is growing and dynamic

 The immerge of China and the US need

a separated economic block without China

Mr Michael Forman, US Trade Representative: “USA would like to help Vietnam to be a country

• f strong and prosperous economy and

comprehensively integrated to the world…. Based on some independent surveys, Vietnam is the country who get most benefits from TPP."

3.2 The meanings for Vietnam and Indo- Vietnamese economic collaboration

• The meanings for Vietnam

 The one of the bets ways for Vietnamese

• export. Open a huge market for Vietnam,

especially US market with low and no taxes (currently TPP enjoys 40% VN’s export) 11,000 types

• f taxations

From existing tariff (12%, 17%, 65%) To 0% or 5%

3.2 The meanings for Vietnam and Indo- Vietnamese economic collaboration (cont.)

• The meanings for Vietnam (cont.)

 Help Vietnam in attracting more FDI and

approaching new technology; help Vietnam in entering global value chain

 In general help Vietnam in achieving more

economic weigh.

GDP of Vietnam would increase 25% and trade 35%. Vietnam might join the top 20 largest economies by 2025.

3.2 The meanings for Vietnam and Indo- Vietnamese economic collaboration (cont.)

• The meanings for Vietnam (cont.)

Challenges The biggest challenge for VN is TPP requires all the production process must be inside TPP when VN imports 80% materials in which garment and textile material imported 70% from China. Anti-dumping sues Property rights More rights for FDI enterprises (can sue country’s government if the latter violate TPP terms and rules)

3.2 The meanings for Vietnam and Indo- Vietnamese economic collaboration (cont.)

• The benefits for India

TPP helps India approaching the Pacific Rim - a huge export market and most advanced and dynamic economic and technological area in the world. India could enjoy low and zero tariff by exporting from Vietnam to TPP countries (while ASEAN-India tariff is 8% from 2016)

3.3 What opportunities for enterprises from India?

Supplying materials to Viet Nam Set up Manufacture bases in Viet Nam for producing goods and exporting to TPP Sectors Indian enterprises could run in Viet Nam for TPP countries Sectors Indian enterprises could supply for Vietnamese domestic market under TPP

• Textile and

garment

• Foot wear
• Wood processing
• Agricultural

product processing

• Electronics
• Leather
• Oil refinery

products

• Polymer

3.3 What opportunities for enterprises from India? (cont.)

Supplying materials to Viet Nam Set up Manufacture bases in Viet Nam for producing goods and exporting to TPP Sectors Indian enterprises could run in Viet Nam for TPP countries Sectors Indian enterprises could supply for Vietnamese domestic market under TPP

• Garment
• Pharmacy
• Real Estate
• Tourism and

Hospitality

• Leather
• Steal
• Trade

3.3 What opportunities for enterprises from India? (cont.)

4.1 Ha Noi City and Ho Chi Minh City - booming development locations for all

 Overview of Ho Chi Minh City (HCMC)  Market shares and competition

4.2 East - West Economic Corridor and India

 Understanding and development of EWEC  Meanings of EWEC for India

4.2 East - West Economic Corridor and India

 Understanding and development of EWEC  Meanings of EWEC for India

4.3 “Exceptional” locations for Indian Enterprises

 Special locations and roles of Da Nang City and

Quang Binh Province

In the prospect of both Trans-Pacific and EWEC

(strategic locations)

4.3 “Exceptional” locations for Indian Enterprises

 Special locations and roles of Da Nang City and

Quang Binh Province

In the prospect of both Trans-Pacific and EWEC

(strategic locations)

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Special locations and roles of Da Nang City and

Quang Binh Province

In the area of the Indian past cultural influence

in South East Asia

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Da Nang City - a market “vacuum” for Indian

enterprises to make a service “base” in filling up in Vietnam

Economy: growth 7-8%; GDP pc: $3,000USD;

Trade: $2.2 bn.;

Rank: No 1 in the PCI (Provincial Competiveness

Index) for 2008, 2009, 2010 and 2013

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Da Nang City (cont.)

Industry: footwear, garment & textile, building

material, IT , fine arts

Service: seaport logistics, tourism and

hospitality, finance, education, insurance.

Agriculture: fishing, forestry, farming

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Da Nang City (cont.)

Export: garment, electronics, electrical, toy,

seafood, furniture, rubber

FDI: US$3.3 bn. with around 300 projects from

34 counties and territories

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Da Nang City (cont.)

Advantages:

i.

Strategic location;

• ii. Tourism infrastructure and hospitality;
• iii. Technical infrastructure;
• iv. Skilled human resources;
• v. Friendly business environment.

i)

Tourism;

ii)

Hi-Tech;

iii) IT and software iv) Healthcare; v)

Banking and finance;

vi) Education and training; vii) Seaport and airport

logistics;

viii) Freight forwarding and

transportation;

ix) High rise housing; x)

Nation-wide pharmacy centre.

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Da Nang City (cont.)

Vision towards 2020: City of Tourism, Service

and Environment

Sectors calling for investment:

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province - the ideal destination for

Indian manufacture “base” in Vietnam for exporting to TPP

Economy: growth 2006-2010: 12%; 2013-2-14:

7.4%.

Investment: 320 domestic projects with

committed capital of US$4 bn.; FDI: 11 projects with cc of US$107 mm.

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province (cont.)

Advantages:

• i. Huge untapped potentials for development;
• ii. Eco-tourism (biggest system of caves in Asia,

largest single cave in the world);

iii.At convenience in transportation; iv.Forestry, farming and mining;

• v. Technical infrastructure for industry

development;

vi.Cheapest labour cost in Vietnam.

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province (cont.)

 Advantages: Biggest cave system in Asia for tourism

development.

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province (cont.)

 Advantages: Son Doong Cave –

the world’s largest cave since 2010 (visitors’ tickets are sold already for 3rd quarter of 2015)

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province (cont.)

Vision towards 2020:

• i. Technical infrastructure;
• ii. Marine economy and border economy;

iii.Development key products; iv.Development human resources and planning.

i.Textile and dye (planned

to be the nation-wide textile & dye centre);

ii.Tourism (world cave

resort, etc.);

iii.Wood processing; iv.Agricultural product

processing;

v.Cotton farming; vi.Thermal power plant; vii.Sea port; viii.Beverage

manufacturing plant;

ix.Chemistry; x.Leather processing; xi.Foot wear; xii.Machinery manufacture.

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 Quang Binh Province (cont.)

Sectors calling for investment:

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 The need of creating an Indian economic

(business) base for exploration of Vietnam’s TPP membership status in non-tariff exporting to USA, Japan, Korea, etc. (possible develop a special economic zone for India there).

4.3 “Exceptional” locations for Indian Enterprises (cont.)

 The need of creating an Indian economic

(business) base for exploration of Vietnam’s TPP membership status in non-tariff exporting to USA, Japan, Korea, etc. (possible develop a special economic zone for India there).

4.4 Mechanism and contact for collaboration

 Creating a mechanism

 The Consulate General could collaborate in

• rganizing study tours to Vietnam and the two

locals as well as further steps towards setting up business there.

4.4 Mechanism and contact for collaboration (cont.)

 Initial contact:

Economic Division, Vietnam Consulate General in

Mumbai

Addr. 805 Powai Plaza, Hiranandani Gardens,

Powai, Mumbai 400076

Tel.: +91 2225702033; Fax: 2225702034 Email: tlsq.mumbai@mofa.gov.vn,

cc: sonthuy20@gmail.com

B2B companies in Vietnam

Tel.: Email: sontrapacific@gmail.com

TPP shall create new and big

• pportunities for Indian enterprises in

Vietnam The need of creating an Indian business base in Vietnam for exporting to TPP Da Nang City and Quang Binh Province - the ideal places for creating the Service & Manufacture Base of India in Vietnam to get huge benefits being brought by TPP and EWEC.