The Socialist Republic of Vietnam is a Southeast Asian country in the Indochina Peninsula. It is the world's 14th most populous country, with an estimated 96.9 million people. Vietnam borders China to the north, Cambodia to the Southwest, Laos to the Northeast, and the South China Sea. Vietnam's development for the last three decades has been remarkable. Political and economic reforms launched in 1986 have played a crucial role in the country's rapid socio-economic development and growth, transforming Vietnam from a developing country into a prosperous nation. In today's article, we will tell you why we choose Vietnam to incorporate. Read on!
Vietnam: Gateway to Southeast Asia
Vietnam is the gateway to Southeast Asia, a country with stable economic growth, massive infrastructure investment, and growing gross-domestic-product (GDP), making it one of the most prosperous countries in Southeast Asia that offer dynamic markets. The country has streamlined exports that match its GDP in value terms. Vietnam was the first country to join ASEAN and offered support to end the confrontation between ASEAN and the Indochinese bloc. The government has also played a crucial role in partnering ASEAN with non-regional players, including European Union, China, India, and Russia.
The country has made substantial efforts within ASEAN to maintain regional security. That's why it has an important strategic position in Southeast Asia, allowing foreigners to visit the country and invest in various businesses. Vietnam's real GDP expanded 2.6% in the third quarter of 2020, making it the only country in the Southeast region to prosper amid the Covid-19 pandemic. According to the International Monetary Fund (IMF), Vietnam has seen significant economic growth during the Covid-19 pandemic and achieved the fourth position in nominal GDP in 2020, passing Malaysia, Singapore, and gaining on the Philippines. The country reported no more than 1,300 Covid-19 cases in 2020, minimizing the economic impact of the outbreak. Unlike other countries in the region, Vietnam imposed a mass lockdown for three weeks and resumed regular manufacturing activity faster. Because there are limited job losses due to Covid-19, consumer spending accounts for 70% of the country's GDP, leading to improved overall growth. That's the reason Vietnam is an ideal country for investors and businesses, especially in tourism, hospitality, real estate, and high-tech industries.
Vietnam has a unique geography with an area of 330363 square kilometers. The country's coastline is along the South China Sea, the Gulf of Tonkin, and the Gulf of Thailand, measuring 3,444 kilometers. It is a country of hills, tropical lowlands, and densely forested highlands, with level land covering 20% of the area. The Red River Delta and highlands in the north, central mountains, also known as Giai Truong Son, the Mekong River Delta in the south, and the coastal lowlands divide the country. Fan Si Pan is the highest point in the country, at 3,143 meters above sea level.
Vietnam has a monsoonal and tropical climate, with an average of 84% humidity levels throughout the year. The annual rainfall is between 1,200 and 3,000 millimeters, and temperatures vary between five degrees Celsius and 37 degrees Celsius. The country's primary natural resources are copper, coal, gold, iron, crude oil, manganese, zinc, and silver.
People and Culture
Vietnam's inhabitants are a mix of historical backgrounds, cultures, and languages. People are friendly, calm, and love to smile. Research shows that Vietnamese people show interest in foreign visitors, making them pleasant, welcoming, approachable, hospitable, and open- hearted.
A gentle handshake and smile is the most appropriate greeting manner for Vietnamese people, and they use patience and good humor to deal with misunderstandings. Local people appreciate exchanging gifts, such as liquor, cigarette lighters, perfumes, pens, etc. Besides, Vietnam is Southeast Asia's most ethnically homogenous country, and Vietnamese make up 90% of the total population. About 85% of the country's ethnic-minority population consists of indigenous groups, including Hmong and Thai. About 3% of ethnic Chinese live in the country's southern urban centers. Buddhism is predominately the largest established religion in Vietnam, with ten million followers. However, the country has various religions based on popular beliefs and imported faiths, including ancestor worship, animism, and theism. European missionaries introduced Catholicism in Vietnam, making it the second-largest religion in the country with over six million followers and 6,000 churches.
Standard of Living
Vietnam has seen enormous growth for the last forty years following the Vietnam war. The country has evolved from one of the poorest countries to become a lower-middle-income nation. A series of reforms made by the government in the mid-1980s played a substantial role in transforming Vietnam from an impoverished nation to a prosperous country. According to the World Bank, the GDP per capita increased by 2.7 between 2002 and 2018. It reached over $2,700 in 2019, leading to economic and social prosperity. As a result, the government lifted over 45 million people out of poverty. Research shows that poverty levels declined from 70% to 5%. Besides, according to the Happy Planet Index, Vietnam is the happiest country in Asia and the world, followed by Costa Rica, Columbia, and Mexico. Unlike other Asian countries, the life expectancy in Vietnam is 75.5 years, an excellent figure for a prospering nation. The United States has a life expectancy of 78.8 years, but it is the 108th happiest country in the world.
Moreover, the country is one of the best places in Southeast Asia for foreign investors who want to live abroad. Not only do you get a pleasant year-round climate and tropical environment, but you also access to contemporary conveniences and comforts. All this makes Vietnam one of the best countries in Asia with the highest living standards. Business Opportunities
Vietnam has one of the fast-growing economies in the world, offering a strategic place for businesses, investors, and entrepreneurs. Unlike other countries in Southeast Asia, Vietnam has a highly qualified population and favorable business opportunities, attracting
entrepreneurs and businessmen from all over the world to make investments and start a profitable business. Here are a few reasons why we prefer Vietnam. Continue reading!
Strong Economy and Growth Rates
The Vietnamese government launched socioeconomic reforms in 1986. Since then, the country's economy has grown significantly, and different sectors have played a substantial role in overcoming uncertainties. Although financial crises decreased economic growth in the past, the country's economy remained resilient and recovered quickly. The country's GDP growth elevated to 7% in 2018, and economic experts argued that Vietnam's GDP has increased during the pandemic. Vietnam was a poor country, but it has now become a financial hub for labor-intensive goods. Research shows that Vietnam is an attractive destination for foreign direct investment (FDI). It means investing in businesses is a golden opportunity for foreign investors and businessmen. According to the IMF and World Bank, Vietnam may replace China in coming years and occupy the number one position in strong Asian economies. Therefore, foreign investors must visit Vietnam and look for business opportunities.
Highly Skilled Population
Foreign businesses and investors can benefit from the highly skilled population of the country. Because it is the third-largest population in Southeast Asia with young, dynamic, and skilled people, businessmen can establish successful businesses in different sectors or industries.
Besides, over 50% of the Vietnamese population is below the age of 30. The country has a well-educated, highly-skilled, and relatively cheaper workforce, making it one of the best, reliable, and profitable population. Vietnam has over 90% literacy rates and the highest internet penetration levels in Asia. As a foreign investor or businessman, you can benefit from the country's population technological awareness. It offers a strong entrepreneur community with a population open to new business ideas. Therefore, starting a business in the country is affordable, cost-effective, reliable, and profitable.
The government has played a crucial role in increasing the country's economy for the last three decades. Unlike other countries, it is easy to start a new business in Vietnam because you won't face harsh competition. You can implement innovative and risky business ideas without any problems, leading to improved productivity and increased return on investments (ROIs). Because the government understands the significance of foreign investments, it has made vital efforts and shown unwavering commitment to amendments and reforms, ensuring a favorable environment for local and foreign investors. The substantial efforts made by the government have enabled foreign investors to invest in Vietnam with more transparency, reliability, and ease, leading to ease of doing business, improved business operations, and streamlined profitability.
Free Trade Agreements
Vietnam is a reputable member of the World Trade Organization and ASEAN, allowing it to streamline trading operations with other countries. Not only has Vietnam signed regional free trade agreements, but the government has made efforts to maintain bilateral relationships with the world's leading economies. For instance, Vietnam signed the Free Trade Agreement with the European Union in 2018, leading to enhanced business opportunities, increased economic growth, and prosperity. The free trade agreements with the leading world's economies have made Vietnam the best destination for investors worldwide.
Every country needs a solid and modern infrastructure to stabilize its economy. Bear in mind that modern infrastructure plays a crucial role in economic growth. Vietnam is one of the few countries in Southeast Asia that realized the significance of infrastructure development. The government made massive investments in the renovation. For instance, an international hub airport, regional airport expansion, and new urban rail network are essential parts of Vietnam's infrastructure development programs. Besides, the country takes advantage of its strategic location because it is the center of the ASEAN. Vietnam has a long coastline that provides businesses with direct access to the main shipping routes. Therefore, Vietnam is an ideal destination for starting a profitable business
Vietnam is a developing country with its growing economy. Although Vietnam has some problems, such as motorbike culture and pollution, the business opportunities and strong economic growth outweigh these disadvantages. Therefore, starting a business in the country offers massive potentials for investors to save money and establish a solid business. Because the cost of living and local prices are stable in Vietnam, foreign investors can take advantage of this country. Not only will you find the best local talents in Vietnam, but you can also establish a strong business with increased profitability. In the next section, we will discuss Vietnam's real estate market. Keep reading!
Vietnam's Real Estate Market
Although the Covid-19 pandemic has hit hard the real estate industry globally, Vietnam is one of the few countries that has conceived the lowest impact. Vietnam's list of feats in 2020 and 2021 is remarkable despite the Covid-19 pandemic that has caused health and economic challenges worldwide. Vietnam has incredible success in containing the pandemic. With a total population of 96 million, it registered no more than 2,630 cases in 2020. The country also eclipsed its Asian rivals and competitors with solid GDP growth of 2.9% during the same period. That's why the real estate market in Vietnam prospered in 2020-2021, with continued economic development and growth, leading to increased property prices. Bear in mind that Vietnam's real estate market remained highly resilient during the Covid-19 pandemic, with the residential, commercial, and industrial sectors booming.
The country's housing market has also experienced enormous growth between 2019 and 2021. Because local people have limited investment options, demand for apartments and residential properties has exceeded the supply of units. Research shows that apartment prices in Ho Chi Minh City have increased in response and grew by a whopping 90% between 2017 and 2021. Foreign investors' demand is one of the key factors that pushed the market. However, the growth is also due to Vietnamese citizens. That's why Vietnam is an excellent destination for real estate investors.
Vietnam's Response to Covid-19
The Covid-19 pandemic has wreaked havoc worldwide, compromising the food supply chain, deteriorating businesses, collapsing economies, and health risks. However, the Vietnamese government gave a robust, effective, and timely leadership. The government was ready for the pandemic due to its pre-pandemic planning and epidemic understanding. Vietnam's swift response and prioritization allowed it to counter the disease from the outset. Local authorities have stronger relationships with the central government, leading to collaborative efforts to mitigate the effects of SARS-CoV-2 and its variants. The Vietnamese government employed a targeted containment strategy and isolated hotspots and people with infections. The government locked down hotspot locations and ranked at-risk individuals on the Ministry of Health "F-System." The F-system is a scale of degrees that focuses on confirmed cases, allowing the health department and authorities to apply social regimes, including isolation in the hospital or home.
Moreover, the government achieved substantial trust from the Vietnamese society due to the communitarian characteristics of the people. Because Vietnam had experienced epidemics since 2003, including Avian Flu, SARS, etc., the government and health department has expertise in mitigating the risk of Covid-19. Furthermore, the government focused on social engagement to develop the Covid-19 policy, and the entire nation worked in wartime-style efforts to counter the novel coronavirus. The Tourism Industry The tourism and hospitality industry plays a crucial role in contributing to Vietnam's GDP. The country's economy has relied on domestic and international travel to maintain the sector. The government resumed local tourism after lifting lockdown restrictions for the 2020's summer holiday season. Research shows that demand for local and international travel will grow more in the post- pandemic era because of increasing domestic spending. Local vacationers who can't travel internationally due to the Covid-19 pandemic are spending money locally, leading to maintained tourism and hospitality sector. Besides, the country's tourism sector also relies on international travel and foreign visitors. Although international travel plunged in 2020 and flights dropped by 80% by the end of 2020, local vacationers filled over 30% of hotels. The tourism and hospitality industry in the country will fully recover by 2024 if Vietnam continues to implement a zero-case-first policy and approach.
While Vietnam has good domestic tourism, it still depends on global markets, representing over $12 billion in spending. Taiwan, South Korea, Japan, and European countries account for over 80% of the country's tourism spending. Because Vietnam has more robust economic ties with Asian and European countries, it can streamline the tourism sector faster. Currently, the government focuses on domestic travelers, considers modifications in pricing models to rebuild demand, implements digital strategies, and lays the groundwork for inbound demand. All this will lead to increased tourism and streamlined travel post-pandemic.
Vietnam is one of the most popular destinations for tourists, vacationers, businessmen, entrepreneurs because it has friendly people, fantastic food, diverse culture, beautiful landscapes, and business opportunities. The country is open for businesses and offers improved infrastructure, affordable labor costs, a favorable tax environment, government support, transparent business practices, and lower expenses. The stable and growing economy has made Vietnam an ideal business destination for foreign investors in various industries and niches, including real estate and high-tech. Many European investors are looking into setting up businesses in Vietnam. Lastly, Vietnam has battled the Covid-19 excellently, unlike other countries in the region. It has a booming local tourism industry and increased prospects for international travelers and tourists in the post-pandemic era. Until Next Time!