Penetrating Mekong Delta Region via Vietnam & Thailand By Loretta Wan – Regional Director of South East Asia & India Tina Phan – Director, Vietnam Hong Kong Trade Development Council

Mekong Delta Region

Overview Strong characters of each markets in the region. Liberalizing economies. Opening up trade. Commitment to regional approaches. Growth and development prospects are promising.

Infrastructure improvement to more trade in the region

Main Infrastructure Projects 1st Mekong Bridge (Cambodia-VN) would help to boost trade in the country and improve links with Laos, Vietnam and the Mekong region. 2nd Mekong Bridge: an important part of the East-West Corridor linking Vietnam, Laos, Thailand & Myanmar.

Opportunities opened in GMS Exporters - importers Logistics companies, freight forwarders, shippers, transport operators Insurance underwriters Political risk insurers in both the Greater Mekong Sub region (GMS) and the neighboring countries.

Vietnam – Gateway to Mekong Delta Region Geography location. Most crowded population in the region (about 82 mil by 2005). Ports in Central of Vietnam will be gateways to a huge hinterland of the region. A stable socio-political environment.

Vietnam An Emerging Market for Hong Kong Companies Hochiminh City Branch Office Hong Kong Trade Development Council

ECONOMIC OUTLOOK (The first 9 months of 2005) · GDP Growth rate  8.1% ·        Exports USD 23.5 billion 21.1% ·        Imports USD 27.4 billion 19.2% ·        Trade deficit US$ 3.89 billion ·        Consumer Price Index  6.8 % ·        FDI (overall) US$ 4.09 billion 37.5% - 570 new projects with US$ 2.64 billion capital, the rest has gone into 167 existing projects. - From Hong Kong: US$ 381.4 million with 26 projects

EMERGING POLICIES Economic restructure is underway in a positive direction into the world economy integration: Stimulate Foreign Investment into Vietnam Government has issued a number of measures to liberalize the market Vietnam fines tune law to WTO principles 4. With the high hope to join WTO by end of the year, Vietnam is now scheduled to approve more than 20 laws and ordinances to meet the requirements made by Members of the Working Party to WTO this year. They are: Civil Code (amended), Commercial Law (amended), Education Law (amended), Law on Tourism, Intellectual Property Law, Law on Import-Export Duties (amended), Law on Enterprise, Law on Investment, and Law on Anti-Corruption…

MARKET TREND More foreign owned retailed up-markets opened Active parallel import at border region Vietnamese consumers are very “brand-conscious” Adoption franchising concept or looking for product licensing

Challenges for Hong Kong companies Impact of ASEAN’s Common Effect in Preferential Tariff (CEPT) Scheme Strong border trade between China & Vietnam Direct competition with S. Korea Pending of WTO member accession of Vietnam

Significance when Vietnam entering WTO Higher Purchasing Power for medium-priced commodities. Lower import tariff. More open and transparent investment policies. Trading rights.

Opportunities for Hong Kong companies (For Products)  Suppliers of Raw Materials & Accessories  Suppliers of machineries & equipment  Suppliers of Electronics & electric appliances  Suppliers of Gifts and Premium  Suppliers of Cosmetics

Opportunities for Hong Kong companies (For Services)  ICT  Film & TV series  Licensing & Franchising

Long-term Opportunities for Hong Kong companies Setting up Production Facilities or Trading House  Providing trade-related services eg. Knowhow, Management & Marketing skills, sourcing, trade-finance……

Thank you!

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