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FDI in Vietnam: Towards Economic Growth for U.S. and Vietnam?

FDI in Vietnam: Towards Economic Growth for U.S. and Vietnam?. My Hanh Hoang ITRN 701/Professor Malawer October 23, 2008. Structure of Presentation. Overview of Vietnam’s FDI growth Economic and FDI stances of U.S. towards Vietnam?

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FDI in Vietnam: Towards Economic Growth for U.S. and Vietnam?

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  1. FDI in Vietnam: Towards Economic Growth for U.S. and Vietnam? My Hanh Hoang ITRN 701/Professor Malawer October 23, 2008

  2. Structure of Presentation • Overview of Vietnam’s FDI growth • Economic and FDI stances of U.S. towards Vietnam? • On the issue of FDI and economic growth between U.S. and Vietnam? • The future of FDI in Vietnam?

  3. Important Timeline for Vietnam • 1954 – Independence from France • 1973 – War ended • 1975 – Communist North controlled all Vietnam • 1970-late 1980s – Economic slump • 1986 – Doi Moi implementation • 1988 – Foreign Investment Law passage

  4. Flow of FDI in Vietnam, 1988-2001 (in US$ million) Source: Nguyen Nhu Binh and Jonathan Haughton paper; Ministry of Planning and Investment

  5. Important Timeline: U.S. and Vietnam • February 1994 – U.S. normalized political relations with Vietnam. • December 10, 2001- U.S. and Vietnam signed a Bilateral Trade Agreement. • June 21, 2006 - Trade and Investment Framework Agreement (TIFA) was signed. • December 29, 2006 - Permanent Normal Trade Relations was passed. • January 11, 2007 – Vietnam became WTO member

  6. Presidential Candidates’ Stance on Trade/Investment with Vietnam • Republican: John McCain - favor • Democrat: Barack Obama – uncertain

  7. Issues with FDI in Vietnam • Legal barriers. • Bureaucracy. • Not as open to trade

  8. The Ease of Doing Business in Vietnam World Bank Group: Doing Business 2009

  9. Protecting Investors World Bank Group: Doing Business 2009

  10. Starting a Business in Vietnam World Bank Group: Doing Business 2009

  11. United States’s Disbursed FDI in Vietnam (in US$ million dollars) Source: Nguyen Thanh Xuan and Yuquing Xing’s paper “Foreign Direct Investment and Exports: the Experiences of Vietnam.”

  12. How will U.S. invest in Vietnam in the future? • Economic crisis factor • Vietnam’s open-market-enough? Factor

  13. Vietnam’s Country Risks Source: Economist Intelligence Unit

  14. FDI in Vietnam Source: EIU 2008

  15. Conclusion Both countries benefit from FDI in Vietnam. However, the U.S.’s FDI in Vietnam will slow down due to its economic crisis and the need for additional market access and security in Vietnam. Vietnam will continue to have FDI inflow.

  16. Questions?

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