Overview Vietnam

Overview Vietnam

Vietnam is a destination pulling attention of both the horticultural industry and tourism.

Introduction

Read the characteristics of Vietnam below, and you’ll understand why this emerging market pulls attention in horticulture & floriculture:

  • Tropical climate
  • Stability, both political and economical. Annual growth 7%. Inflation rate 3%.
  • Liberal economy (for a communistic country). Open and export oriented economy. Fast growing emerging market.
  • 97 million inhabitants. 3rd largest population in the Asia Pacific region, with large domestic demand.
  • Large geographic area (330.000 km2, 8x The Netherlands)
  • Large working population. 60% of population is between 15 and 55 years of age. Average age of population is 32 years (2018). 76% of population lives in rural regions. Unemployment rate 2%.
  • Low labour wages. Average salary $200/month.
  • GDP $240 billion. Agriculture accounts for 20% of GDP.
  • Main import partner: China.
  • Main export partner: USA.
  • Member of WTO (since 2007) and ASEAN (since 1995)
  • NEW! EU – Vietnam Trade Agreement (since June 2019)
Time zone: +6 hrs NL winter time / +5 hrs NL summer time
Main languages: Vietnamese, English (limited skills, in touristic areas only)
Currency: 1 EUR = 25 Dong (₫)

Politics

The Social Republic of Vietnam, bordering China on the south, is governed by a communistic party with liberal views on international trade.

Geography

From north to south Vietnam stretches 1600 km. The country can be divided in 3 parts:

  • the high mountain region (2500 m) and plateaus in the north,
  • a narrow coastal region in the middle and
  • a hilly region with large, fertile river delta in the south.

Weather and Climate

Vietnam has a tropical climate with daily temperatures reaching 30-35°C al year. However, in the northern and central part temperatures in winter are substantially cooler (15-25°C).

During the long rain season flooding occurs frequently.

Population

Vietnam is inhabited by nearly 100 million people, ranking 15th position in world’s list of most populated counties.

Most people are employed in outdoor agriculture. Main food crops include: rice, peanut, cereals and beans.

8% of population lives below the poverty line (UN). In 2018 around 44% of employees worked overtime for an average of 28 hours/month to make ends meet (Vietnam Briefing).

Life expectancy at birth: 77 years.
Expected years of schooling: 13 years (literacy 95%).

Economy

Vietnam has shown an impressive and steady annual growth of around 7% since 1990. This ranks Vietnam among the highest in Asia (Worldbank).
Continued economic growth is expected due to increase of both export and increase of domestic demand.

Vietnam has major industries in agricultural processing, machine construction, chemical fertilisers, glass etc.

It has large resources of oil, gas and other minerals.

The country is self-supporting in energy production.

Sustainability

In 2016 Vietnam ranked 4th position in the global Sustainable Economic Development Assessment (Boston Consulting Group). It is praised for converting the country’s wealth into well-being for its population. Middle and upper class will double in size between 2014 and 2020 (BCG).

Vietnam exploits 4 sources of sustainable energy: hydroelectricity, wind power, solar power and biomass. In 2018 hydropower plants contributed 40% to the total national electricity capacity; solar power another 8%. Windpower capacity will double in 2019. (Wikipedia)

International Trade Agreements

Following political and economical reforms since 1986, Vietnam entered the World Trade Organization (WTO) in 2007.

On Jun 30th 2019 a EU – Vietnam Trade Agreement and investment protection agreement was signed, downsizing administration for import and export, simplifying handling of goods, and deleting nearly all customs duties. It’s expected this development will boost international trade. Read more about Benefits of EU – Vietnam trade and investment agreement for agriculture.
Note: For some major Vietnamese crops, such as rice and sugar, Vietnamese export is still limited to quota, to prevent flooding the EU market.

A bilateral trade agreement with The Netherlands is still in progress (2019).

Dutch – Vietnamese Business

The Netherlands and Vietnam have a long mutual history in cooperation and trade.

The Netherlands is EU’s largest investor in Vietnam.

Export of fruit & vegetables showed an increase of 26% per year over the period 2009 – 2018, rising to $4 billion.
Vietnam has potential to become a major global player as a flower exporter.

For Vietnam The Netherlands is its second largest trading partner in the EU. (Import from The Netherlands €1,1 billion, export to The Netherlands € 5,0 billion.)

On the ‘Ease of Doing Business Index’ (2019) Vietnam receives a score of 69 by the Dutch RVO .
(For comparisson: scores of Germany, Belgium, Kenia and South Africa are 24, 45, 61, 82 respectively.)

Vietnam counts 3 international airports: in Hanoi (airport Nội Bài), Đà Nẵng(airport Đà Nẵng) and Ho Chi Minh City (airport Tân Sơn Nhất). In addition the country has 14 local airports.

Dutch business travellers require a visa. You are advised to apply for a business visa and not for a tourist visa. For Dutch passport holders an additional e-visa is obligatory. You can apply for it at CIBIT. It is valid for 30 or 90 days and cannot be extended. On date of application your passport must be valid for at least 6 months.

Tips:

  • Book a qualified agricultural translator in advance, since English is not yet spoken widely on a professional level in Vietnam.
  • Do call Vietnamese people by their first name. Keep in mind though that in writing first and latter name are in reverse order!
  • Download brochure Doing Business in Vietnam (.PDF 0,7MB).
  • Consult Landenkompas Vietnam for practical, up-to-date and country specific advice when travelling abroad. For instance about health issues (vaccinations), language, price levels, customs.
  • Consider membership of the Dutch Business Association Vietnam (DBAV), to visit their thematic or networking events.

Tourism

Vietnam is becoming increasingly popular as a touristic destination for its beautiful landscape, hospitable people and tasty food.

The beach at the east is popular for its beautiful sandy beaches and clearblue water.

The best time to discover Vietnam is from January to December. This period you will avoid the long rain season, with regular flooding.

Dutch tourists require a tourist visa. For Dutch passport holders an additional e-visa is obligatory. You can apply for it at CIBIT. It is valid for 30 or 90 days and cannot be extended. On date of application your passport must be valid for at least 6 months.

Tips:

  • Using tap water for consumption is disrecommended.
  • An international driving license is not valid in Vietnam.
  • Make use of a translation device. For instance Google Translate (free).

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