Vietnam Part 4: Back in New York

Kit O’Connor ’17

NEW YORK – Back home, I think I finally know what time it is after nearly six days in the US – when people say that the jet lag is significantly worse west to east, they’re not kidding. It’s strange to think that four weeks ago, I was just getting ready to leave for Hong Kong en route to Vietnam, but now I can say that I definitely have an appreciation for and basic understanding for both the country of Vietnam and the economic environment therein. And, of course, a newfound appetite for $2 banh mi sandwiches.

To structure the overall lessons of the course, I’m going to break this into three main takeaways, two that I’ve previously discussed (but are critically important) and one other key aspect of life and business in Vietnam.

Takeaway 1: The emerging consumer economy will be the driving force of Vietnamese growth in the near term.

It’s quite easy to assume, as, frankly, I did, that Vietnam would be composed primarily of manual laborers who worked for subsistence while manufacturing the gadgets and clothes that are immediately shipped to richer countries. While Vietnam certainly has a thriving manufacturing industry, domestic firms work hard to serve a populace that is increasingly focused on health and quality. One theme that was hit several times was a focus on proof of quality: Vietnamese consumers vastly prefer food that can be proved to be produced in a safe manner. Just take a look at the outfits that we wore while visiting Veeteq, a farm focused on healthy produce!

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Takeaway 2: The communist government operates in an opaque and glacially slow fashion, unless it sees politically relevant reasons to expedite processes.

While the general populace seems mostly unaffected by the government (one tour guide had no idea Vietnam was a communist country and income tax payers are estimated to be south of 10%), many foreign nationals can quickly become frustrated by the inability to proceed without a local fixer, who generally has to grease the right hands. Building a business without a strong consumer presence can be dangerous, as it could easily be suddenly ruled illegal – B2C firms, however, could be slightly better off, due to the active and relatively free press. One story in particular that seemed to demonstrate the government’s motivations: after Rex Tillerson was nominated to Secretary of State, ExxonMobil was suddenly granted permission to drill in an offshore oilfield after years of negotiations.

Takeaway 3: Vietnam has developed transportation solutions that uniquely suit both the needs of the individual cities and the overall country.

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A constant presence in Vietnam is motorbikes. Roads: motorbikes. Sidewalks: motorbikes. Most shops: motorbikes. Factories at closing time: veritable seas of motorbikes flowing out. An especially poignant question was asked during the meeting with the American Chamber of Commerce in Hanoi: what technological progress will have a similar effect on Vietnam as the motorbike? After thinking for about a minute, the chairman of the committee couldn’t come up with a single advancement that would have anywhere near the impact of the motorbike, which had opened up opportunities and connections so widely.

A similar issue existed in the trek from Saigon to Hanoi. At first, many of my classmates wondered why we were taking a 1.5 hour flight rather than what we suspected would be a quick bus ride. Turns out that the bus would have been nearly 25 hours due to poor roads and rough terrain. Once again, technology came to the rescue: every hour on the hour, multiple airlines are flying large planes (747s, A380s) back and forth from Vietnam’s two main cities. Both these solutions prove that the Vietnamese are practical above all and perfectly willing to find the best (if not the most traditional!) method to move both the society and economy forward.

Well, that’s a wrap for me! Time to start preparing for my next Global Immersion class: Family Business in Nordic Europe. Cam on (thanks) for following along!

Vietnam Part 3: A Tale of Two Cities

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Kit O’Connor ‘17

HA LONG BAY & HANOI, VIETNAM – Remember in the first blog about Vietnam when I said that CBS students rarely have just one adventure at a time? Well, a group of students from Vietnam, your correspondent among them, jetted (well, vanned and hydrofoiled) off to Ha Long Bay where we spent 24 hours sailing and kayaking amongst the thousand plus islands that make up “Descending Dragon Bay”. Our guide, Chan, regaled us with the legend of thousands of dragons dropping from the sky and each forming an island over ten thousand years ago. Incidentally, Chan was the tallest Vietnamese person we met and had gotten offers to play in the professional basketball league of Hanoi, but turned them down for the more lucrative and self-fulfilling field of tourism. Yet another difference from life in the States.

 

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But I’m skipping a key part of the trip! The title of this post refers not to Hanoi and Ha Long Bay, but Hanoi and Saigon. Hanoi and Saigon are about as different as any two cities in a single country can be: Saigon is the gregarious, free-wheeling, entrepreneurial hub, while Hanoi is the buttoned-up political center with constant reminders of the government around every corner. Our company visits, to Vietcombank, GE, and General Motors, were dominated by talks of how the companies were backed by (or cooperated with) the government in order to conduct business properly in Vietnam. One particularly instructive moment occurred when a student asked about a curious projected 2017 reversal of a falling inflation rate. The answer, courtesy of Vietcombank, which is majority-owned by the government of Vietnam: the set price for basic services is going to be increased.

 

file_000-11Wait, who’s that in the background next to the sickle? Enhance…

file_000-9That’s right, a statue of Ho Chi Minh in the conference room of the bank!

These visits stood in stark contrast to the meetings with the American Chamber of Commerce and US Embassy in Hanoi. The Americans (and a Brit and Canadian) stressed the unpredictability of the government moves and expressed frustration that the deck often seemed to be stacked in favors of locals with connections. However, both consistently praised the young and educated population and seemed to truly believe that the best years of Vietnam are on the near horizon. I certainly came away with the impression that Vietnam has a host of fantastic investments for both the local populace and foreign capital!

That just about wraps up the in-country portion of this blog for me. I’ll be back in a week or so to give a proper summary of the trip, but I now must continue the rest of my personal adventure. On to the land down under!