1. VIETNAM BUSINESS AND INVESTMENT CLIMATE Vietnam Chamber of Commerce and Industry VCCI

2. SOME FIGURES Area330,000 Km2 CapitalHanoi Population90.73 millions (increased 1.08% over ‘13) Labour Force54.48 million (increased 1.56% over ’13) GDP growth rate5.98% (2014); 5.42% (2013); 5.03% (2012); Literacy rate90.3% Exchange rate1 USD = 21,300 VND Administrative structure63 Provinces and Cities Coast line3,200 km Main ExportsPetroleum, clothing, footwear, rice, coffee

3. Economic Situation Year 2009 GDP growth rate5,32% Inflation rate 6,88% Year 2010 GDP growth rate 6,78% Inflation rate 9% Year 2011 GDP growth rate 5,89% Inflation rate 18,9% Year 2012 GDP growth rate5.25% CPI (over ‘11)9.21% Year 2013 GDP growth rate5.42% CPI (over ‘12)6.04% Year 2014: GDP growth rate5.98% CPI (over ’13) 4.09% Source: General Statistics Office of Vietnam

4. Economic Situation in 2014 1 – GDP growth rate 5.98% 2 – Industry growth 7.14% 3 – Agriculture 3.49% 4 – Service 5.96% Main Industrial products in 2014 Indicators Volume (000 tons) -Coal41,231.4 -Crude Oil15,530.0 -Steel 3,006.0 -Fertilizers (Ure and NPK) 4,771.1 -Seafood 2,023.3 -Power (Billion kwh) 140.2 -Cement59,800.0

5. Economic Situation in 2014 6 – Export increase: 13.6% (over ‘13) Total Export in 2014 150 Billion USD Value (USD Billion) Indicator2014 -Mobile phones & accessories 24.1 -Textiles & Garments 20.1 -Foot wears10.2 -Crude Oil 7.2 -Seafood 7.8 -Rice 2.9 -Coffee 3.5 -Rubber 1.7 -Handbags, purses, suitcases, hats & umbrellas 2.5 -Iron & Steel products 1.9 -Coal 0.5

6. Economic Situation in 2014 7 – Import increase: 12.1% (over ‘13) Total Import in 2014:148 billion USD Value (USD billion) Indicator 2014 -Machinery, equipment, spare parts 22.4 -Petro 7.6 -Steel & Iron 7.6 -Materials for Textiles & Leather Industries 4.7 -Fertilizers 1.2 -Automobiles(cars importing) 1.5 8 – International arrivals: 7.87 million increased 4% over ‘13; tourism: 4.76 million visitors.

7. Economic Situation in 2014 9 – Foreign Direct Investment in 2014: 20.23 billion USD, it is 93.5% to 2013; -1,588 new projects with capital of 15.64 billion USD (increased 9.6% in comparison with 2013 in term of registered capital) - 594 projects with increased capitals. - 774 new projects in Manufacturing and industry with total capital (new and increased) of 14.49 billion USD, accounted for 71.6%. Up to 2014: 17,499 active projects with registered capital of 250.67 billion USD.

8. Economic Situation in 2014 Foreign Direct Investment until 2014 Top FDI provinces: Hochiminh (37.9 billion USD); Ba Ria Vung Tau (26.7 billion USD); Hanoi (23.46 billion USD), Dong Nai (21.59 billion USD)& Binh Duong (19.9 billion USD) Top Foreign Investors (till 2014) 1.Korea4,110 Projects 37.2 billion USD 2.Japan 2,477 -- 36.8 ---- 3.Singapore1,351 -- 32.7 ---- 4.Taiwan2,368 -- 28.4 ---- 5.British Virgin Islands 549 -- 17.9 ---- 6.Hong Kong 869 -- 15.4 ---- 7.USA 717 -- 10.9 ---- 8. Malaysia 484 -- 10.7 ---- 10.Thailand 374 -- 6.6 ---- 20. Brunei 159 -- 1.6 ---- 27. Indonesia 41 -- 0.38 ---- 31. Philippines 70 -- 0.29 ---- 50. Laos 8 -- 0.067 ---- 51Cambodia 13 -- 0.054 ---- ASEAN FDI to Vietnam is more than 52 billion USD

9. Economic Situation in 2014 In 2011: 77,000 new enterprises Up to 31/12/2011: 622,977 enterprises in total In 2012: 51,000 enterprises registered, and more than 40,000 companies bankrupted and stopped working. In 2013: 76,955 enterprises newly registered, and 60,737 companies bankrupted and stopped operating. In 2014: 74,842 enterprises newly registered, and 67,823 companies bankrupted and stopped operating.

10. OVERALL ADVANTAGES 1.Stable political system, Government commitment to reform. 2.Low labour cost, hard working workforce (one of the highest literacy rate in SE Asia). 3.Energy: - Gas Reserve23 tcf * - Coal Reserve20-30 billion tones - Over 2,000 rivers 4.Minerals: - rich natural resource, mineral, reserves largely untapped: iron, copper, bauxite, precious stones, as well as construction raw materials: granite, clay, limestone. 5.World Bank and other international donors have been supportive so far. 6.Vietnam is one of the top 5 beneficiaries in the world for World Bank. 7.Access to ASEAN, APEC, WTO and other regional markets (China) * (tcf = trillion cubic feet)

11. OVERALL DISADVANTAGES 1.Underdeveloped infrastructure. 2.Legal framework still under completion. 3.Inflation and fluctuation in exchange rate 4.Red tape. 5.Lack of qualified and experienced labour in market economy. 6.Weak nation – wide distribution system.

12. BUSINESS OPPORTUNITIES 1 – Infrastructure: -11,000 km of high way. -3,000 km of Railway. -8,000 bridges. -Seaports, airports, water supply, waste treatment. -Improvement of Banking System and Financial Sectors. -Tele-communication : (need USD 3.5 Billion investment) – 2007: 10.8 million telephones; 127 million mobile phones in 2011. -Information technology (IT); Annual growth: 50% (need USD 2 million investment). -Power: 40 new power plants 13.000 MW (demand increase 15%/year). Total investment 05 Billion USD/year (about 20 billion USD) -Health care: Hospital, Medical equipments, pharmaceutical products. -Environmental products. -Education: vocation schools, language, IT, managements, engineering…

13. BUSINESS OPPORTUNITIES 2 – Oil and Gas: Production: -30 Million tones -2 refineries, 5 million tones/year each. -1 fertilizer plant of 1 million tone/year capacity. -Petrochemical plants -Gas industries. 3 – Agriculture and Seafood: -Industrial crop plantation and processing: -Rubber, coffee, tea, palm oil, sugar, cashews. -Beer and Soft drinks and food processing (beer 1,500 millions litters) -Tropical fruits and processed vegetables (315,000 tones of Vegetable oil) -Increase fishing capacity, seafood farming and processing to 4 million tones/year, sea product export: 5 billion USD/year

14. BUSINESS OPPORTUNITIES 4 – Labour intensive industries: Textiles, garments (10 billion USD by 2010), footwear (5 billion USD), electronic products, computers, plastic products. Wood products: (5 billion USD). 5 – Tourism: -Major investments: hotel, transport, training and tourism service industries. 6 - Mineral exploitation: -Coal: -Cement -Steel product -Precious stones -Construction materials

15. BUSINESS OPPORTUNITIES 7– Transportation means: Bus, trucks, railway locomotive, wagons, boats, maritime engines, etc… 8– Engineering: Farming machines, construction equipment, hand tools, spare parts, etc…

16. USEFUL CONTACT Vietnam Chamber of Commerce and Industry 9 Dao Duy Anh Str., Hanoi, Vietnam Tel: +84 – 4 – 35742022 Fax: +84 – 4 – 35742020/ 35742030 Email: vcci@fmail.vnn.vnvcci@fmail.vnn.vn Web: www.vcci.com.vnwww.vcci.com.vn