Legal and Regulatory: Vietnam is in the process of transitioning to a full market economy. Vietnam’s legal powers are centralized in one supreme body, and then delegated to lower bodies. The National Assembly is the only body with the power to amend the Constitution and pass laws. The Vietnamese government has issued various policies to encourage enterprise and foreign investment in recent years. However, certain industries such as financial services, telecommunication, mining and utilities, continue to be subject to restrictions on foreign ownership. Vietnam joined the World Trade Organization (‘WTO’) in 2007.
Workforce and Cost of Living: The number of people of working age in employment in Vietnam totaled 53million in 2013 with an unemployment rate of 2.3%. Wages and salaries in Vietnam vary widely across occupations and geographic locations. In 2013 the average annual income per person was approximately $2,000. In comparison with other countries in Asia, the cost of living in Vietnam remains relatively low
Business Etiquette and Culture: Many Vietnamese are more comfortable using their native language rather than English. However a lot of Vietnamese can speak English, especially in the larger cities. Presenting business cards is an important ritual in the Vietnamese business world. Cards are exchanged at the beginning of a meeting using both hands. Translating written materials into Vietnamese shows high regard for Vietnamese colleagues. Face to face business meetings are important in Vietnam and an appropriate level of respect must be shown according to rank and seniority.
The Future:
The Socialist Republic of Vietnam is a single-party state. As the only party in the political arena, the role and influence of the Communist Party is unique. As a member of the WTO, Vietnam must continue to improve its business and investment environment and bolster its legal system to meet WTO requirements. Vietnam has made significant efforts to ensure that foreign investors are not disadvantaged compared with their local counterparts, including an overhaul of the legal framework governing investments and protection of intellectual property. Furthermore, the government has taken measures to simplify administrative procedures in areas such as import and export, company establishment and making tax payments.