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1、Copyright 2023 by Boston Consulting Group.All rights reserved.Vietnam:A Global Engine of Growthwith contribution from 1Executive SummaryVietnam:A Global Engine of Growth report provides a comprehensive analysis of Vietnams investment landscape,aiming to providevaluable insights for the international
2、 investment community on the growth journey and future prospects of Vietnam,one of the most fastestgrowing economies in Southeast Asia,as well as its risks and challenges.Over the past decades,Vietnam has emerged as an attractive hotspot with substantial capital inflows,attributed to robust economic
3、 growth,strategic location,and abundant market potentials.Vietnam ranks 70th over 190 other countries in“Ease of Doing Business”research by WorldBank Group 2020,coupled with ongoing governments effort on policy reforms,which paves the way for Vietnams pro-business environmentgoing forward.This repor
4、t presents some highlight on macroeconomic overview,business environments as well as investment opportunities in theVietnam:Tech-enabled sectors,modern B2B services and green-focused initiatives are among the most potential verticals for future growth.However,to ensure success,it is imperative to co
5、nduct a comprehensive evaluation of the market entry strategy and the ability to thrive,takinginto account the various economic,legal,operational and environmental challenges that may arise.Successful foreign investors largely possess 4 key factors:Strategic long-term investment strategy into govern
6、ment key areas,leveraging government incentives schemeStrong local partnership to leverage expertise and knowledge of local businesses,saving time and cost navigating local norms and business practicesInvestment diversification across multiple asset classes/industries in order to minimize risks from
7、 monopoly industries and external shocks as well as to maximize returns.Strong risk management and mitigation strategy in place to proactively manage risks associated with emerging marketMethodology.This report uses proprietary data from Golden Gate Ventures and public databases/reports to draw mean
8、ingful analysis.2Vietnam:At a GlanceECONOMIC INDICATORSSOCIAL INDICATORSGDP Growth rate8.02%(2022)3.32%(2023Q1)Benchmark Interest Rate5.5%(May 2023)Inflation rate3.15%(2022)3.35%(2023Q1)GDP per CapitaUS$3607.23(2022)FDI InflowsUS$27.7b(2022)US$Ease of doing businessGlobal rank:70/190(2020)Ha NoiDa N
9、angHo Chi Minh CityPopulationNearly 100mGovernment(Single-party)CommunistLiteracy96%(2019)Global Index of Digital Entrepreneurship SystemsGlobal rank:63/113(2022)Global Innovation IndexGlobal rank:44/132(2021)Internet Usage74%of population(2021)3Macroeconomic overview|Vietnam has been one of the fas
10、test growing economies within Southeast AsiaGDP Growth rate(%annual)-2020-2024FSource:Vietnam General Statistics Office,Philippine Statistics Authority,Singapore Department of Statistics,Vietnam Ministry of Planning and Investment,Passport Euromonitor,IMF,World Bank.GDP per capita($US 2015 constant&
11、CAGR from 2017-2022)Vietnam has been outperforming its regional peers in terms of GDP growth rate and isexpected to keep up with this momentum in the upcoming yearsIn 2022,Vietnam achieved economic stability despite global turmoil with decenteconomic growth and inflation being under control compared
12、 to regional peersVietnamese households focus on human development,proven by the highest%spending on education and healthcare than regional peersSpending as%of household income in 2022Urbanization rate(%of total population),2022&Average urban population annual growth rate(2018-2022)As a major agenda
13、 in the national development focus,urbanization has picked upspeed to support Vietnams ambitious growth trajectoryAverage growth(18-22)0.1%2%1.7%2.1%2.8%1.6%4Vietnam has emerged to be one of the mostattractive destinationsfor FDI in the SEAregionSetbyrapideconomicgrowthandindustrialization,Vietnams
14、FDIdisbursementhas been accelerating at a CAGR of 6.4%(2015-2022).The Vietnamese government has takenproactive steps to foster healthy investmentclimateforFDImovementssuchasadministrative reform,legal and tax incentives.Top sectors for FDI disbursement:Top Countries by Total registered capital:Macro
15、economic overview|Vietnam has emerged as a hotspot for FDI especially manufacturing,with APAC countries as major contributors(*)We expect Vietnam will maintain the current CAGR of 6.4%in FDI Disbursement in 2023 amid global economic downturns,amounting to$24B for FDI projects by year-end 2023.The sh
16、aded area is actual figure for 5M2023.Source:Vietnam Ministry of Planning and Investment,Golden Gate VenturesVietnam,Disbursed FDI(2015-5M2023)and 2023 forecast,billion USDCovid-19 pandemic123Manufacturing&ProcessingReal estate activitiesProduction,electricity,gas,stream&air conditioning supply123Si
17、ngaporeSouth KoreaJapan5Macroeconomic overview|In the near term,Vietnam is expected to maintain strong momentum and achieve highest growth forecastASEAN-6 Real GDP growth(%),20202025FSource:Oxford Economics,OECD;BCG Research&Analysis202020212022E2023F2024F2025F-100510IndonesiaMalaysiaPhilippinesSing
18、aporeThailandVietnamAs the global supply chain shift continues to take place and manufacturing being the key driver,Vietnams export is expected to exceed most others in the regionVietnam was the only one to log real economic growth in 2020,thanks to its quick success in curbing the pandemic,whilst o
19、ther economic recovery is further delayed by recurring and prolonged COVID wavesVietnam is on track to sustain its outperformer position in SEA if leveraging well its strong growth momentum6Macroeconomic overview|Significant change in trade expected in next 10 years with ASEAN as the key winner1.Cor
20、ridors in the map above represent 46%of global tradeSource:BCG Trade Finance Model 2022,UN Comtrade,OECD,WEF,IHS,TradeAlert,BCG AnalysisSources:Natural Earth Country boundaries without large lakesLegend 2.3%Width of arrow represents total change in trade flows for 2031 vs 2021($billions)Color of arr
21、ow representsCAGR for 2021-2031(%)5568017477232-63-26-23-27459CanadaUSMexicoMercosurAfricaAustraliaJapan/South KoreaChinaGCCEUIndiaASEANRussiaUK272338397083-38-262Change in trade of goods(major corridors1,2031F vs.2021,$B)Increase in trade for ASEAN 2031$1 Tn7Macroec
22、onomic overview|Global manufacturers are increasingly shifting production to Vietnam and SEA due to escalating geopolitics between China and the West1.CAI:The EU-China Compressive Agreement on Investment;2.Corporate actions date is the date of news article stating intentionSource:Reuters,VnExpress,B
23、CG Global Advantage Geopolitics&Trade Impact AnalysisChina increased tariffs on US productsUS-China 2-way tariff escalation,US export controlson HuaweiUS-ChinaPhase I deal;Penalties imposed over Chinasforced laborExport controlsexpandedfurtherAUKUSagreement tocounter ChinaCHIPS act&IRA policy passed
24、 challenged China;New exportcontrols on Al&semiconductortechnologies;Latvia&Estonia exit Chinas“16+1”CEE coop.US-China balloon incident;EU warns China on weapons supplying to RussiaUS house ofrepresentativesvotes to set upcommittee tocounter China;EU suit vs.China at WTOChina sanctions 4 US mission
25、membersChina Adds US Defense Companies to Unreliable Entity ListCorporate actionsPolitical actionsChina implores US to drop tariffsIncreases parts supplies from China to VietnamIntends to invest$4 B in a manufacturing baseStart its 2nd plant in VietnamExpands its mnfg.mega site in VietnamInvests$150
26、 million in Vietnam for factory buildingChinasactionsCorporate actionsUS&EU actionsConsiders investment in Vietnam for chip packaging assembly plant Considers building plants in SEA instead of China US-China postpone trade deal review;China pushes US to cancel tariffsPlans investment for$300 mil.man
27、u.plantsMoves production of MacBooks from China into VietnamInvest more than US$1 billion factory in VietnamPlans to invest an additional US$45 million in its subsidiary in VietnamPartners with Dai An Group for$1 B pharma manufacturing plantPlans to build an automobile factory in VietnamChina&Russia
28、sign“no limits”Partnership;China-EUsummit ends without resultsJun20Jul-Sep18Jun21Dec21Feb22Aug22Oct22Nov22Dec22Jan23Feb23Jun19Mar20Aug21Mar23Jun22Selective8Macroeconomic overview|Vietnam will see a significant growth in its middle class and affluent population in the next 10 years,especially in emer
29、ging citiesNotes:MACs Middle and affluent classesSource:BCG Vietnam wealth and population model,BCG geoanalyticsMore than 1,000,000 MACs Less than 200,000 MACs200,000500,000 MACs500,0001,000,000 MACsNha TrangPhan Rang-Thp Chm2021Thi NguynSn LaHi PhngC MauYn BiTuy HaVit TrVinhLo CaiKon TumH TnhPleiku
30、Bun Ma Thut NngCn ThBc KnTy NinhNinh BnhLng Sn LtLai ChuHo BnhH GiangGia NghaCao BngBc NinhBc LiuThanh Hong HTam Kin Bin PhQui NhnBc GiangH LongQung Nging HiRch GiPhan ThitTh Du MtHuTuyn QuangVnh YnThi BnhNew HanoiHng YnPh LHi DngBn TreVng TuTn AnM ThoV ThanhNam nhTP.H Ch MinhLong XuynCao LnhVnh Lon
31、gBin HaTr VinhSc Trngng Xoi14 cities with 200,000 MACsHo Chi Minh Economic center of VietnamHanoi&Hai PhongCapital&largest seaport in VietnamThi NguynSn LaHi PhngC MauYn BiTuy HaVit TrVinhLo CaiKon TumH TnhPleikuBun Ma Thut NngCn ThBc KnTy NinhNinh BnhLng Sn LtLai ChuHo BnhH GiangGia NghaCao BngBc N
32、inhBc LiuThanh Hong HTam KNha TrangQui NhnBc GiangH LongQung Nging HiPhan Rang-Thp ChmRch GiPhan ThitTh Du MtHuTuyn QuangThi BnhNew HanoiHng YnPh LHi DngBn TreVng TuTn AnM ThoV ThanhNam nhTP.H Ch MinhLong XuynCao LnhVnh LongBin HaTr VinhSc Trngng XoiDa Nang Focus on ICT,tourism,logistic sectors,and
33、attract more FDI-major share of MAC in Central Vietnam Can Tho Center of Mekong Delta region for economic activities and MAC population203025 cities with 200,000 MACsin Bin PhVnh YnHo Chi Minh&Southeast region House more MACs-more industrial parks and logistic in Ba Ria Vung TauHanoi,Bac Ninh,Hai Ph
34、ong&Red River DeltaBenefit from more industrial areas and FDI companies setting up plants9Business environment|Recent regulatory reforms have created a more conducive environment for businesses in Vietnam*Economies are ranked on their ease of doing business,from 1190.A high ease of doing business ra
35、nking means the regulatory environment is more conducive to the starting and operation of a local firm.Source:World Bank:Ease of Doing business 202070thGlobal rank Rankings of Vietnam in Ease of DoingBusiness(2020)released by World BankGroup,measuringregulatoryperformance relative to other countries
36、Dealing with construction permits25Getting credit25Getting electricity27Registering property64Enforcing contracts68Protecting minority investors97Trading across borders104Paying taxes109Starting a business115Resolving insolvency122Vietnam,Rankings on individual topics Vietnam has been working on reg
37、ulatory reforms and technology infrastructure toeasetheprocessofgettingconstructionpermits,credit,andelectricityforentrepreneurs.However,improvements are still in need in cross-border trading,taxpayment process,and insolvency treatment,posing foreseeable challenges forprospective investors and found
38、ers.10Business environment|The strategic location and openness to the global economy through various trade agreements provide geopolitical advantagesVietnam acts as an indispensable link into the global supply chainwith long coastline of 3,260 km stretches across the countryBeing an export-driven ec
39、onomy,Vietnam has also establisheddiplomatic connections with numerous markets and global powersNotes:The RHS diagram is for visualization purposes only,this is non-exhaustive list of Vietnams FTAs.Full list of Vietnams FTAs is in Appendix-Vietnam FTAs.(1)According to Lloyds list of 100 Ports 2020 a
40、t Lloyds List,the latest update by Lloyd Maritime Company(UK):Sai Gon port(ranking 22nd),Hai Phong port(ranking 28th)Cai Mep port(ranking 32nd).(2)Vietnam had an index of 76.37 in 2022Q4 by UNCTAD.The index can be considered a proxy for accessibility to global trade through the shipping network.The
41、higher the index,the easier it is to access a high capacity and frequency global maritime freight transport system and effectively participate in international trade.(3)EFTA including Norway,Switzerland,Iceland,Liechtenstein)(4)ASEAN has multilateral trade agreements with India,Mainland China,New Ze
42、aland,Australia,Japan,South Korea,Hong Kong.Source:EY,SEA map attributed to VectorF,Lloyds List Intelligence,Open Development Vietnam,Website of WTO Center under Vietnam Chamber of Commerce and Industry at https:/www.trungtamwto.vn/,Vietnam General Consulate Houston,visualization adapted from Asia B
43、riefing.Currently,Vietnam has created diplomacy with 178 nations and has developedeconomic,trade,and investment relationships with 224 countries and territories.Vietnam holds memberships in various international organizationsVietnam has 15 active(signed)Free Trade Agreements(FTAs)and other 4under ne
44、gotiation.*Non-exhaustive VIETNAMThailandMalaysiaSingaporePhilippinesIndonesiaVietnams sea area locates in the important maritime routes and the air lines betweenthe Indian Ocean and the Pacific Ocean,between Europe,the Middle East andMainland China,Japan and other regional countries.33 airports(11
45、international airports)320 seaports&river ports(163 international ports)14thVietnams rank on Liner Shipping Connectivity Index(2022Q4)(2)Top 503 seaports of Vietnam named in the Worlds largest cargo throughput(2020)(1)South KoreaRCEPVKFTACambodiaLaosMyanmarMyanmarVIETNAMEUEVFTAASEAN4KyrgyzstanPhilip
46、pinesSingaporeJapanMainland ChinaKazakhstanIndonesiaBruneiNew ZealandHong KongArmeniaBelarusThailandRussiaMalaysiaChileMexicoAustraliaPeruCanadaIsraelCanadaUAEIn negotiationCPTPPVCFTAMainland China11Business environment|Vietnam also offers powerful competitive advantages in workforce,living environm
47、ent and corporate tax treatmentsNote:Expat City ranking is annual report from InterNation where expats are asked to share personal experiences from the quality of life to working abroadSource:Oxford Economics,InterNation,BCG analysisMinimum monthly wages of Vietnam vs Countries,2022,$200380310231473
48、Competitive labour costVietnamChinaIndonesiaPhilippinesMalaysia141362143Workforce in manufacturing sector,2022,million people and percentage of total populationFormidable industry workforce sizeVietnamChinaIndonesiaPhilippinesMalaysia14%10%8%4%9%k20%25%25%30%24%Corporate income tax across major APAC
49、 countries,2022Favourable tax rateVietnamChinaIndonesiaPhilippinesMalaysiaExpat City ranking,20216thHCMC1st5th11th13thKuala LumpurSingaporeBangkokShanghaiHospitable living environment for expatriates12Business environment|Investment incentives are also provided to support economic breakthroughs in m
50、any key industries in VietnamSummary of Prioritized Business Lines and Projects Eligible for Investment Incentives In VietnamClassHigh techLarge scaleSocial importanceDescription:Investment projects in the following sector categories:Information technologyBiotechnologyNew Material technologyAutomati
51、on technologySupporting products for high technologyScientific research and developmentSoftware productionManufacturing projects with a minimum invested capital of VND 6,000 billion,and which meet one of the following Annual revenues of VND 10,000 billion by the fourth year of operations Employment
52、of at least 3,000 workersManufacturing projects*with a minimum investment capital of VND 12,000 billion and which utilize certain technologies.Investment projects in the following sector categories:EducationVocational trainingHealthcareCultureSportsEnvironmentalIncentives:10 percent CIT for 15 years
53、*CIT exemption for 4 years*50 percent reduction on payable CIT for 9 years10 percent CIT for 15 years*CIT exemption for 4 years*50 percent reduction on payable CIT for 9 years10 percent for entire life of project4 years of CIT exemption*5 years of 50 percent reduction on payable CITIndustry-based ta
54、x incentives in Vietnam*From the first year of operating income generation*from the first year of profitNote:Projects invested into within economic zones may be liable to different treatment.Source:Vietnam Briefing13Source:Resolution No.81/2023/QH15,Decision No.569/QD-TTg,BCG analysisDigital Economy
55、GreenEconomyNational Master plan for2021-2030 with vision to 2050Modern technical&social infrastructureDeveloping peoples material,cultural&spiritual valueForming and developing economic corridorsHigh productivity,advances in science,technology&innovationHi-tech economyLabor intensiveStatic forces(e
56、.g.low-cost labor,natural resources)Emerging economyTalent focusDynamic forces(e.g.innovation)Regional top-tier economyGreen ambitionDepleting/PollutingAnd moving to more sustainable development modelFrom“High speed”.To“High quality”.By restructuring the engine of economic growthInvestment opportuni
57、ties|Government direction to double down on 3 key growth pillars to restructure the engine of economic growth 14Investment opportunities|and shift focus to“higher quality”FDISource:Resolution No.50/2019/NQ/TW on“Perfecting the policies of FDI cooperation by 2030”;BCG analysisKey selecting factors fo
58、r FDIHigh qualityPrioritizing value added investment to the people such as Education,R&D,Supply chain linkages,etc.Prioritizing businesses that operate effectively(high safety standard,fully integrated)&fulfill theircommitments(e.g.providing jobs,paying tax,etc.)Environmental impactImproving standar
59、ds and technical regulations on products,environmental protection,resources and energy saving in line with regional and world standardsE.g.New projects manufacturing reproduction energy,clean energy,energy from wasteTechnology efficiencyEncouraging advanced/new/high/clean technology and modern manag
60、ement projectsEncouraging technology transfer and governance for Vietnamese companiesVietnams shifting of FDI strategy from“attracting at all costs”to“selectively attracting”High qualityFocus on project that blended into the development plan of the countrySustainabilityMore sustainable and eco-frien
61、dly investmentsTechnology efficiencyMore technology,innovation,less labour intensive investment15Investment opportunities|Future potential growth sectors worth investigating for foreign investorsTECH-ENABLED SECTORSMODERN B2B SERVICES GREEN ECONOMY123HealthTechFinTechEdTechAsset-light LogisticsRenew
62、ablesIT&DIgital servicesDeep-dives in next pages De-carbonisation servicesRecycling&circular economyNon-exhaustive16An untapped sector with numerous unresolved painpoints,HealthTechisemergingtobebeyondpromisingAttributed to the following drivers:Growing tech-savvy population with high propensity to
63、spend onhealthcare driven by expanding consuming class and rising healthawareness.Overloadedpublichospitals,lackofpublicinfrastructureinvestment and undersupplied healthcare professionals havecreated a solid ground for innovative forms of healthcare such asremotemonitoringsolutions,telemedicine,AI-d
64、iagnosisandempowered the private healthcare sector to grow.Unpleasant experience,long wait,outdated infrastructure remainpatients pain points during offline health check-up at publichospital,giving a rise for private sector and patient-focus startupsolutions.Government support and preferential tax t
65、reatment to encouragethedevelopmentofhealthcaresectorandmakeroomforinnovation.Tech-enabled sector:HEALTHTECH*The list is non-exhaustive and not ordinal.Source:Insignia Ventures Partners,InnolabAsia,Tracxn TechnologiesNOTABLE STARTUPS6%Healthcare spending as%Vietnam per capita income(2022)$161$408Hea
66、lthcare spending per capita in Vietnam(2028)Healthcare spending per capita in Vietnam(2018)x3Telemedicine/O2OBooking/Digital PharmaciesMarketplaceBiotechnology17Tech-enabled sector:FINTECHFintech is making a boom in Vietnam,the sector hasreceived substantial funding while presenting hugeroom for gro
67、wthAttributed to the following drivers:Young,tech-savvy population of nearly 100 million people withincreasing digital adoption and smartphone ownership.A significant proportion of the unbanked population remainsuntapped;MSMEs(representing 70%of Vietnams GDP)arestruggling with financing.Rising middl
68、e-class and buoyant economic activities furtherfortify demand for fast,cost-effective and innovative financialservices digitalization.Favourable government policies and initiatives to promote digitalpayments,financial inclusion and innovation.Deals count(*)Vietnam,Total funding value&Count of fintec
69、h deals,2016-9M2022(in million USD)(*)Golden Gate Ventures preliminary count,non-exhaustive.Fintech sector includes but is not limited to core payment services,technological applications into financial services and banking.*The list is non-exhaustive and not ordinal.Source:World Bank,Statista,Do Ven
70、tures;Tracxn TechnologiesNOTABLE STARTUPSPaymentConsumer finance BlockchainData IntelligenceVietnam,Transaction value of the fintech sector,2017-2027F,by segment(in billion USD)2257251413302718Tech-enabled sector:EDTECH(*)Golden Gate Ventures preliminary count,non-exhaustive,not ordinal.Source:Golde
71、n Gate Ventures,Crunchbase,Do Ventures,Cento Ventures,EdtechAgency.Vietnam,Total funding value&Count of Edtech deals,2013-2021(in million USD)NOTABLE STARTUPSEdTechisgainingattentionfrompurpose-driveninvestorsAttributed to the following drivers:Large and growing young population with a strong demand
72、 inhigh-quality education and professional development with highlevel of digital adoption into learning,teaching and educationalexperiences.Higher spending propensity on education due to deep-rootedbeliefintheimportanceofhavingeducationaladvantages,coupled with rising disposable income and buoyant e
73、conomicgrowth.COVID-19 has set a new learning and teaching normals that canbe facilitated through online platforms.Supporting government initiatives to promote the developmentof education and edtech industry.Digital transformation of education in Vietnam is still in its early stages.In2019,Vietnam w
74、as among the top 10 fastest-growing online educationmarkets worldwide,with an annual growth rate of 44.3%.Currently,there areover 200 EdTech firms in Vietnam,serving 2 million users nationwide,with amarket size estimated at no less than$2 billion.Deals count(*)-3+5+3+3+2+6+11+19Asset-light models ar
75、e making a huge boom in businessand investment landscapeThe supply chain and logistics sectors have undergone significantchanges in recent years.Traditionally seen as heavy-asset businessmodels due to huge capital expenditure and large asset base,theemergenceofinnovativeplayersandshiftingglobalsuppl
76、ychaindynamics have allowed companies to leverage third-party services andadopt asset-light models.With Supply-Chain-as-a-Service,organizations can focus on their corecompetencies while utilizing partners key assets to adapt quickly tochangingcustomerdemands.Thisapproachenhancesoperationalefficiency
77、 and enables businesses to tailor their services more effectively,leading to improved outcomes and increased agility in the face ofevolving market conditions.Modern B2B services:ASSET-LIGHT LOGISTIC*The list is not exhaustive and ordinal.Source:Golden Gate Ventures analysis,Crunchbase,KPMG,Accenture
78、How the landscape has been transformedBuilding blocks for Asset-light models:SUPPLY CHAIN AS A SERVICESupply chain planning as a serviceSupply chain management as a serviceLogistics as a serviceManufacturing as a serviceCommercial optimization as a serviceInventory as a serviceTraditional industryIn
79、novative movesNotable startupsCourier,express,and parcelLast-mile deliveryFulfillment serviceWarehousingTransportation&StorageTrucking flatformsSupply chain solutionsInventory/warehouse/order managementRoute ops20Green investments has been fueled by the newwave of ever-growing green opportunities dr
80、iven bystrong commitment to Net Zero targetIn 2021,Vietnams Prime Minister Pham Minh Chinh announcedVietnams commitment to achieving its net-zero emissions targetby 2050 at the UN Climate Change Conference in Glasgow(COP26).Renewables see great potential due to strong onshore&offshoretechnical wind/
81、solar capacity,also attributed by the following drivers:Governmental supports to allow foreign investment inindustries that were previously restricted,and revisions tolawsthatincludeforeignbiddersinpublicly-fundedprojects.Rising investment in infrastructure through public-privatepartnerships(PPPs),p
82、romotinginnovationanddigitalization to support its net-zero transition.Opportunities for capital investment(*):Early-stagecapital:Onshore/Offshorewindproject&Small-scaled solar panel projects with high risk-highreturn potentials amid unclear feed-in tariff policies.Mature capital:Mature/operational
83、onshore wind projectswithlessriskthankstoprojectsthatarealreadyinoperations by established developers.Green economy:RENEWABLES(*)According to Bain and Temasek,with contributions from Microsoft,Southeast Asias Green Economy 2022 Report:Investing behind new realities.*The list is non-exhaustive and no
84、t ordinal.Source:Temasek,Bain&Company with contributions from Microsoft,Chambers and Partners,Press releases.80%of corporate green capitalhas been deployed in Solar/Wind/Other renewables project in SEA(cumulative,2020-2M2022)RECENT DEVELOPMENTplans building 3.9-GW offshore wind farm in Vietnamintend
85、s to develop$13-billion wind farm in Vietnamaim to develop 1.5 GW of renewables in VietnamNOTABLE STARTUPS ON SOLARSolano Energy21Photo courtesy of Fitch SolutionsRisks&Challenges|Investors needs to carefully manage the risks to ensure successful investment-Political&economic risksA relatively open
86、economyTerritorial disputesVietnams economic openness ranks 5th out of 35 Asian markets:score 74.6/100-higher than Asias average of 46 and global average of 49.5,according to a report by Fitch Solutions.Vietnam is one of the most open economies to international trade in Asia:Vietnamese trade represe
87、nted 186%of GDP in 2021(World Bank,2023).Nevertheless,Vietnams excessive reliance on exports and FDI has been seen as a potential problem for the country.While foreign invested companies accounted for only 20.3%of Vietnams GDP,they contributed a whopping 67.8%to Vietnams total export turnover in 201
88、9.High foreign dependancy can make Vietnam vulnerable to global economic changes andchanges from major foreign-invested enterprises on which the Vietnamese economy is over-reliant.One oft-cited example of Vietnams over-dependence on foreign capital and exports is Samsung.Itwas Vietnams largest forei
89、gn investor,with an accumulative investment of more than US$17 billion asof March 2020.In 2019,Samsung Vietnams revenue of USD68.3 billion was about 26%of VietnamsGDP and had an outsized contribution of 19.4%to Vietnams export turnover.A single foreign-invested company contributing 20%to export turn
90、over is unprecedented in Vietnam and rarely seenanywhere in the world.Should Samsung decide to wind up or scale back its operations in Vietnam,Vietnams economy will suffer enormously.Economic openness scores of East and Southeast Asian marketsNote:Fitchs economic openness is generated from 2 main in
91、dicators:trade and investmentopenness,which are based on import,export and FDI values as a percentage of GDP.It scores eachmarket on a scale of 0-100,with 100 being the highest.Political risk in Vietnam is moderate.The political and security environment has a track record of stability,helping to pro
92、vide a conducive environment for doing business.The government remains committed to stamping out corruption and implementing policies to attract investment.Territorial disputes remain an ongoing risk to Vietnamese relations with neighbouring countries,as Vietnam is dependent on imports.Source:Allian
93、z Research,La Coface,Export Finance Australia12Source:Fitch Solutions,VIR,Vietnam Chamber of Commerce and Industry,ISEAS Yusof Ishak Institute.Trade structure by destination/origin(%of total,2021)ExportsRankImportsUnited States 29.1%1Mainland China 33.8%Mainland China 17.0%2Korea,Republic of 17.3%Ko
94、rea,Republic of 6.6%3Japan 6.9%Japan 6.1%4Taiwan 6.4%Hong Kong 3.6%5United States 4.6%22Vietnamsproductivityandcompetitivenessremainhinderedbyhighlevelsofgovernment intervention in the economy through regulation and the dominance ofstate-owned enterprises(SOEs).SOEs have played a dominant role in se
95、veral important industries,namely oil and gas,electricity,banking,telecommunications,transport infrastructure and production of some basic input materials for the economy.Up to 96%of customers use mobile phone networks of SOEs,including Viettel,VNPT,and Mobifone.State-owned commercial banks such as
96、BIDV,Vietcombank,Vietinbank.accounted for more than 50%of the total loan balance of the whole banking sector.Investors may not prefer startups operating in heavily government-regulated industriesdue to the implied risk of competitiveness and regulatory barriers.E.g.In March 2023,36 clean electricity
97、 investors signed a document to petition the PrimeMinister about the inadequacies in the electricity generation pricing mechanism withwind and solar power,making their power plants cannot sell electricity to EVN-monopolynational power system,putting investors at risks of financial plan failure and i
98、ncreasingbad debts.However,Vietnams divestment and equitisation plans have opened several opportunities for investors,incentivizing FDI in SOEs.For instance:Risks&Challenges|Investors needs to carefully manage the risks to ensure successful investment-Legal®ulatory risksLegal risk analysisVietnam
99、s scores on Worldwide Governance Indicators are broadly in line with or stronger than the average for emerging Asian countries.The notable exception is voice and accountability.Low risk of expropriation:consistent with Vietnams governance scores around the control of corruption and rule of law.The g
100、overnment can only expropriate investors property in cases of emergency,disaster,defence,or national interest.The government is required to compensate investors if it expropriates property.Some industries are heavily regulated12Source:VIR,Vietnamnet,nhandan.vn,Ministry of Finance Source:Export Finan
101、ce Australia23Risks&Challenges|Investors need to carefully manage the risks to ensure successful investment-Operational ChallengesSupply chain challengesLack of local expertiseForeigninvestorsshouldbeawareofITinfrastructureandcommunication capabilities of Vietnam:Quality of internet access is not hi
102、gh-speed and uniform across the country:Median download speed is 38.23 Mbps via cellular mobile connection&is 76.16 Mbp via fixed broadband.IT challengesManagement votes“Lack of alignment between supply chain operatingmodel and business direction”and“Lack of real-time visibility of cost,service leve
103、l,inventory,etc.on the organizations end-to-end supply chain”as top concerns within supply chain management.(KPMG 2021,“Vietnam Supply Chain at a Glance”)Shortcomings in production standards:Majority of manufacturing facilities in Vietnam are inadequately equipped to reach international standards re
104、garding quality,health,and safety that pose challenges to international new entrants.Physical logistics Infrastructure in need of improvement:Transportation infrastructure in Vietnam still presents limitation in terms of quality,connectivity of modes of transport,management,technology application th
105、at yet to meet the demand of delivering goods from factories to ports or distribution centers such as long lead time,transshipment problems,etc.High logistics costs:The latest report of the Vit Nam Logistics Association revealed that logistics costs were equivalent to around 20-22%of the countrys GD
106、P,much higher than Thailand(19%),China(18%),Malaysia(13%)and nearly x3 higher than the US and Singapore(8%),leading to profitability headache to businesses.Foreign investors generally face difficulties to navigate localpractices and understand the intricacies of the marketLack of availability of spe
107、cialized personnel,skills and knowledge:Foreign investors often rely on local experts or industry advisors to get industry insights,sector-specific frameworks,and market dynamics.Language and communication barriers:Different languages used by investors and local stakeholders may hinder effective col
108、laboration and potentially incur miscommunication during investment and operations processes.123(*)Speedtest Global Index ranks Vietnam 47 out of 140 countries and 45 out of 182 countries in terms of the median download speed via cellular mobile connection and via fixed broadband internet.Source:KPM
109、G,Savills,Open Development Vietnam24Air pollution has yet to met WHO guidelines:The primary causes of air pollution in Vietnam is the use of fossil fuels for power generations,exhaust transportation vehicles and factory emissions.Along with industrial growth,Vietnam is expected to continue experienc
110、ing low air quality problems,especially near industrial zones.Water pollution remains major concern:A significant portion of Vietnams wastewater is discharged without undergoing treatment,only 12.5%of municipal wastewater get treated.Treatment of wastewater is often neglected,resulting in the untrea
111、ted discharge of wastewater from craft villages,factories outside industrial zones,and local healthcare facilities into rivers,lakes,and oceans.Amid renewables mania,Vietnams government are yet to prepare a complete regulatory package for a smooth transition.There is not yet clear guidelines for roo
112、ftop solar panel power generation:Currently,majority of customers of solar energy are households and small-scale buildings.Vietnams governmental agencies are in the process of developing policies for solar energy installation,usage,sales,and waste management.This may cause a delay in solar energy de
113、velopment and uncertainty for foreign investors.Monopoly of EVN may hinder the development of renewables projects:Up to now,EVN(Electricity of Vietnam)enjoys exclusive control over Vietnams power transmission and distribution sector,creating high barriers to enter the market.EVN is now in charge of
114、buying electricity from power generation companies and distributing to end-consumers,which diminishes bargaining power of independent renewable energy producers.Urban households connection to drainage systems is limited to 46%,only Industrial wastewater fromindustrialzonesistreated,butcentralizedwas
115、tewater treatment facilities are available in only 9.4%of industrial clusters.(World Bank Group 2019,“Vietnam:Toward a Safe,Clean,and Resilient Water System”)PollutionLack of regulatory comprehension for green initiatives 12Source:Press releases,World BankRisks&Challenges|Investors needs to carefull
116、y manage the risks to ensure successful investment-Environmental challenges25Potential exit options in VietnamAlthough exit strategies for PE/VC investors in Vietnam remain relatively complex and their efficacy at scalehas not yet to be fully demonstrated,there are still some viable optionsDomestic
117、IPOTrade saleto strategic investorSecondary buyout by another PE firmManagement buyout or redemptionOnshore listings can be a viable(but not easy)option for private equity portfolio companies due to the thin liquidityof the countrys key stock exchange,the Ho Chi Minh City Stock Exchange,and strict l
118、isting requirements,includingthe requirement that any issuer have a return on equity of at least 5%in the year preceding the year of the listingapplication and profitability for the 2 consecutive years prior to the year in which the listing application is made.Given the limitations of the domestic I
119、PO market,in recent years,a number of Vietnamese companies,includingportfolio companies of private equity firms,have been exploring offshore IPOs.However,due to a combination ofpoor market conditions and a number of legal and technical hurdles,none of these companies have been able tocomplete an off
120、shore IPO to date,though it is likely to be only a matter of time before one is successful.AVietnamese company looking at consummating an offshore IPO will require complex restructuring in order for theoffshore listing to be workable.In the context of a trade sale or secondary exit,most private equi
121、ty sellers will agree to make fundamentalwarranties only.Holdbacks and escrow mechanisms are sometimes used but are rare in Vietnam.Warranty and indemnity has been used more frequency recently in M&A transactions as foreign buyers seek tomanage risks and streamline dealsManagement buyouts and/or red
122、emptions are relatively rare and will often come into play on deals that havenot gone well for whatever reason.Source:Freshfields Bruckhaus Deringer 123426ContributorsVinnie LauriaFounding Partner,Golden Gate VenturesVinnie is an entrepreneur turned venture capitalist.Hes been investing in Asia for
123、over a decade and hasmade 60+investments to date.He is a KauffmanFellow and Tsinghua EMBA candidate.Vinnie joinedhis first startup while still in high school.Tram NguyenAssociate,Golden Gate VenturesTram is an investment professional with 7 years ofexperience spanning early-stage technology ventures
124、to cross-border mergers&acquisitions.Tram brings aunique blend of local knowledge and internationalexposure.SheholdsanMScinFinanceandManagement from the University of Exeter.Uyen NguyenIntern,Golden Gate VenturesUyen is a fresh graduate with Economics&FinancemajorfromRMITUniversity.Uyenhasintensepas
125、sion about investment career and is excited toparticipate in different investment projects in eitherVietnam or SEA markets.Quyen DangIntern,Golden Gate VenturesQuyen isafresh graduatefrom RMITUniversityVietnam majoring in Economics and Finance.Withstrong passion in strategy and finance,she has beene
126、xploringdifferentanglesofdealcontinuuminvarious investment projects in multiple industriesfocusing on Vietnams market.27ContributorsIl-Dong KwonManagingDirectorandPartner,HeadofBCGVietnamIl-Dong has been with the Vietnam office for 7 yearsworkingwithindustryleadersandcentralandprovincial governments
127、 on their strategy and large-scale transformation programs.He also co-leadsBCGs work in risk management for the Asia Pacificregion.Hanno StegmannManaging Director and Partner,Head of BCG X SEAHanno is dedicated to inventing,building,investing in,andlaunchingcategory-changingbusinessesatstartupspeedt
128、ogetherwiththeworldsmostinfluential corporates.Over the last several years,Hanno launched more than ten new businesses invariousindustrialgoodsandconsumerproductscompanies that have created billion-dollar impact.Arnaud GinolinPartner BCG VietnamArnaudhasmorethan15yearsofconsultingexperience in desig
129、ning and executing strategicprograms for clients in industrial goods,energy andpublicsector.Mostrecently,hehashelpedgovernments develop programs to accelerate theirtransformation efforts focusing on smart technologyand sustainability.28About Golden Gate VenturesAbout GGVbrainGolden Gate Ventures,wit
130、h HQ in Singapore and offices in Indonesia and Vietnam,is a Southeast Asian venture capital firm founded in 2011 that brings together knowledge and experience from Silicon Valley with passion and ambition for Southeast Asia.For over a decade,weve proudly backed some of the regions most audacious fou
131、nders and had the privilege of being part of the regions incredible growth story:launched 4 funds,have US$250M AUM,and invested in 80+companies with 9 unicorns across our portfolio.Were deeply committed to continue to play a supporting role-spot trends,deliver data-driven insights,facilitate lasting
132、 global connections-and always show up for those brave enough to catalyze change.Internal proprietary tool that helps us analyse trends,predict new sectors,and signal sentiment and investibility that guides our deal sourcing,deal screening and research processes.29About Boston Consulting GroupAbout
133、BCG XBoston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities.BCG was the pioneer in business strategy when it was founded in 1963.Today,we work closely with clients to embrace a transformational approach
134、 aimed at benefiting all stakeholdersempowering organizations to grow,build sustainable competitive advantage,and drive positive societal impact.Our diverse,global teams bring deep industry and functional expertise and a range of perspectives that question the status quo and spark change.BCG deliver
135、s solutions through leading-edge management consulting,technology and design,and corporate and digital ventures.We work in a uniquely collaborative model across the firm and throughout all levels of the client organization,fueled by the goal of helping our clients thrive and enabling them to make th
136、e world a better placeBCG X is the pioneering new tech build and design division of Boston Consulting Group.It is uniquely positioned to support companies in Southeast Asia seeking to kickstart the journey to new markets through venture opportunities.BCG X brings together advanced tech knowledge and
137、 ambitious entrepreneurship experience to turbocharge BCGs trusted corporate offering.The division is positioned to help organizations embrace,enable,and succeed in delivering innovation at scale,backed by over 3,000 technologists,data scientists,programmers,engineers,and human-centered designers lo
138、cated in more than 80 cities acrossthe globe30Legal DisclaimerDisclaimerThis communication has been prepared by Golden Gate Ventures Research Team(“GGV”)for general information only and is not intended to be relied uponin any way.Golden Gate Ventures is an early stage venture capital firm based in S
139、ingapore.We are an independent company incorporated in Singapore andare not affiliated to any other company outside of Singapore and the Cayman Islands.In particular Golden Gate Ventures is not associated in any way withGGV Capital based in Silicon Valley,United States of America and Shanghai,China
140、or Golden Gate Capital based in San Francisco,United States of America.Our business takes us to various parts of the world,and there may be companies in those countries with a similar corporate name,but we are not in any wayrelated to them.Information,projections and imagesInformation contained in t
141、his communication has been obtained from materials and sources believed to be reliable at the date of publication,however GGVhas not taken steps to verify or certify its accuracy or completeness.Opinions,projections and forecasts in this communication depend on the accuracy ofany information and ass
142、umptions on which they are based,and on prevailing market conditions,for which GGV does not accept responsibility.Norepresentations or warranties of any nature are given,intended or implied by GGV about this communication,any information,opinions and forecastscontained within this communication or t
143、he accuracy or enforceability of any material referred to in this communication.GGV(including its employees,officers and agents)any of the employees of GGV referenced in the communication will not be liable,including in negligence,for any direct,indirect,special,incidental or consequential losses or
144、 damages arising out of or in any way connected with use of or reliance on anything inthis communication.For the avoidance of doubt,GGV(including its employees,officers and agents)will not be liable for any investment decision based inwhole or in part on the information or projections contained here
145、in.All images are only for illustrative purposes.Given the above,GGV strongly advises allrecipients of this communication to exercise caution and to conduct their own due diligence on the relevance,accuracy,completeness and currency of theinformation in this communication.Appendix Business Environme
146、nt32Key business environment factors contributing to investment decision in Vietnam Vietnams strategic location,stable political environment,and openness to the global economy through various trade agreements provide it with geopolitical advantagesVietnams workforce is also advantageous,with competi
147、tivelabor costs and a formidable sizeTo further encourage investment,numerous legal requirementswere amended to make investing in Vietnam more transparent and promisingInvestment incentives are also provided to support economic breakthroughs in many key industries in VietnamHowever,to ensure investm
148、ent success,its important to have a good understanding of the legal and regulatory frameworksurrounding corporate structure and taxation in Vietnam33Geopolitical advantages(1/2)Relatively more politically stable than neighboring countriesVietnamisconsideredhavinglowerprobabilityofpoliticalchallenges
149、andgeopoliticaldisruptionsthanitsregionalpeersAttributed to:“bamboo diplomacy”highlighting thegreatestprioritizationofmaintainingpeace,preventing conflict,and fosteringinternational cooperation in the contextof the rapidly changing world,anda single-party democracy system thatbrings a high degree of
150、 governmentalstability.(*)percentile rank,rankings over 163 independent states and territories,0 is the highest ranking,100 is the lowest ranking,data from Institute for Economics&Peace.(*)percentile rank,rankings over 213 countries and territories,0 is the highest ranking,100 is the lowest ranking,
151、data from World Bank.Source:EY,World Bank,Institute for Economic&Peace,Press releasesVietnam vs.neighboring ASEAN countries,Indices in percentile rank *Note:lower figure=higher ranking=lower risk of disruptions34Foreign-owned corporations in Vietnam(with amount of foreign capital invested in million
152、 USD)Geopolitical advantages(2/2)*The graph is for illustrative purposes only and does not represent an exhaustive list of all foreign-invested manufacturers in Vietnam.Source:Press release,Vietnam General Statistics OfficeMultiple global giants name Vietnam asa long-term manufacturing baseThe massi
153、ve influx of FDI inflows can beattributed to increasing attractiveness ofVietnam as a solution for the China+1strategy.South Korea and Japan are among thefirst countries setting their productionplants in Vietnam since the 1970s and stillremain the top contributors to VietnamsFDI until the present da
154、y.Manufacturingistheleadingsectorattracting the most FDI due to Vietnamsfavourablemixofcompetitivehumancost,standard corporate tax rate,andbeing a member of many economic tradezones.$20,000Vietnam emerges as a destination for China+1 strategy35Ease of doing business:Legal requirements(*)Full English
155、 version on Legal update of Decree 31/2021/ND-CP is available at Decree 31/2021/ND-CP EN|KPMG.*For more information on List A and B of Appendix 1 of Decree 31/2021/ND-CP,view Appendix-Prohibition List&Appendix-Market Entry List.Source:Vietnam Law on Investment,view full detail at LEGAL FRAMEWORKS ON
156、 DOING INVESTMENT VIETNAM(mpi.gov.vn).Business sectors that foreign investors can access(Decree 31/2021/ND-CP guiding the Law on Investment 2020)(*)Foreign investors are not allowedForeign investors are allowed with conditionsForeign investors are allowedSectors which are not yet accessible for fore
157、ign investors(Prohibition List of Appendix I of Decree 31/2021/ND-CP)Foreign investors have the same market access as that of domestic investors(sectors not being mentioned inProhibition List and Market Entry List)The Government does not commit on market access,foreign investors may be subject to re
158、strictions under Vietnams domestic law in the corresponding industries/sectors.Sectors which are accessible with conditions for foreign investors(Market Entry List of Appendix I of Decree 31/2021/ND-CP):Foreign-owned ratio Form of investment Scope of investment Investor capability and others=In-prin
159、ciple approval of higher-level competent authorities requiredExample:Security services,goods and servicesunder state monopoly,Administrative and judicialservices,Manufacture of military equipment ormaterials,etc.Example:Nuclear power plant,special use forests,headwater protection forests or border p
160、rotectionforests;constructionofairports,terminals;petroleumprocessing;bettingandcasinoforforeigners;golf courses;etc36Ease of doing business:Legal requirements(*)Article 39 Law on Investment No.61/2020,Law on Enterprise No.59/2020/QH14,dated 17 June 2020,issued by the National Assembly of VietnamNum
161、ber of days mentioned above are counted as business working days.View full detail at LEGAL FRAMEWORKS ON DOING INVESTMENT VIETNAM(mpi.gov.vn)Source:Vietnam Investment Law,reproduced from Deloitte,EYProcedures to set up a companyForeign investors are required to completethe necessary registration pro
162、cess withthe relevant licensing bodies in order tolegally engage in business operations inVietnam.The new Law on Investment andLawonEnterprisesrequiresforeigninvestors to follow 2 mandatory steps:1Acquiring the Investment Registration Certificate(IRC)(*)2Acquiring the Enterprise Registration Certifi
163、cate(ERC)(*)IRC is required only for investments by foreign investors or deemed-to-be foreigninvestors(panies with more than 51%of charter capital held by foreignownership).Step 3Step 1Step 2Location selectionIRC ApplicationERC ApplicationSet-up&Announce(15 days)(3 days)Procedures of registration pr
164、ocess(Projects not under in-principle review)(*)Projects located INSIDE industrial zones(IZ),export processing zones(EPZ),economic zones(EZ)and Hi-tech parkProjects located OUTSIDEIZs,EPZs,EZs,Hi-tech parksProvincial Management Authority of the ZonesProvincial Department of Planning and InvestmentIR
165、C issuedApplication dossier for company set-up(IRC included)Provincial Department of Planning and InvestmentERCissuedSeek approval fromSeek approval fromOnline/Offline submission(3 days)37Ease of doing business:Case studies(*)Golden Gate Ventures estimation based on announced Uber will hold a 27.5%s
166、take in Grab,while Ubers CEO will join Grabs management board.Prior to Uber deal in 2018,Grab had a valuation of$6b.Source:Press releases,MarketLineCase studies of foreign companies entering Vietnam market via M&Aa leading commercial bank in South Korea,established representative office in Vietnam i
167、n 1993 retail arm of ANZ Bank in Vietnam-an Australian-based provider of banking servicesYear of deal:2017Asset transfer:8 branches located in Hanoi and Ho Chi Minh City,and ongoing roles for all retail staff.Transaction value:undisclosedAcquirerTargetDetailMarket EntryMarket Expansiona Singaporean-
168、based ride-hailing and on-demand delivery platform,entered Vietnam in 2014 a ride-hailing platform,entered Vietnam in 2014 and being Grabs direct rivalYear of deal:2018Asset transfer:Ubers operations in SEA(Cambodia,Indonesia,Malaysia,Myanmar,the Philippines,Singapore,Thailand and Vietnam).Transacti
169、on value:$1.65b(as a part of regional deal(*)a South Korean top exhibitora leading Vietnam-based cinema chainYear of deal:2011Asset transfer:market share of 60%,54 screens in 7 locations.Transaction value:$73.6ma subsidiary of Metro AG,a German retail company specializing in wholesale distributiona
170、Thai colomegrate having wholesales and retail businessYear of deal:2014Asset transfer:19 wholesale stores across the country,more than 3300 employeesTransaction value:$711m38Legal and regulatory framework(1/3)Type of corporate structuresLimited Liability CompanyWith two or more membersWith one membe
171、rEstablished by its member(s)by way of capital contribution to the LLC.Joint Stock CompanyPartnershipPrivate EnterpriseJoint VentureEstablishedbyitsfounding shareholders onthebasisoftheirsubscription to shares ofthe Joint Stock Company(JSC).Established by generalpartners.Apartnershipmayincludelimite
172、dpartners.Established by a single individual.Established by the owning partners ofa foreign-invested Joint Venture withat least two foreign entities or at leastone foreign and one local entity.Apartnership of companies are createdfor a specific business purpose.Owned by a single individual.At least
173、two generalpartnerswhomustbe individuals.One legal entityor individual.Legalentitiesorindividuals.Maximumnumbermustnotexceed 50.At least 3 shareholders.No maximum numberof shareholders.Minimumcontributionof30%from foreign ownership.However,the government also mandatesminimumcontributionsfordomestic
174、partners in JVs in someindustries.Thecompanyowner is liable forthedebtsandother liabilities tothe extent of thecompanyscharter capital.The members are liablefor the debts and otherliabilities of the entity tothe extent of their capitalcontributions,except forthecasespecifiedinClause 4 Article 47 of
175、theLOE 2020.Theshareholdersareonlyliableforthedebtsandotherliabilities of the entityto the extent of theircapital contributions.Ageneralpartnerisliable for the companysobligations equal to allofhis/herassets.Alimited partner is liablefor the companys debtsequal to the promisedcapital contribution.Th
176、e owner is liable forthe entire operationofthecompanyequal to his/her totalassets.JV can be incorporated as a LLCor JSC(if there are more than 3investors/parties).Eachpartyisresponsibleforthecompanywithin the scope of its capitalcontribution to the charter capitalof the company.Source:EY,Vietnam Nat
177、ional Law,LOE No.59/2020/QH14,dated 17 June 2020,issued by the National Assembly of Vietnam EstablishmentOwnershipLiability39Joint Ventures are very popular,why?Establishing a joint venture(JV)with a local business(es)is a popular method used by foreign companies to enter the Vietnamese marketthanks
178、 to the expertise of the local partner(s),as well as the low compliance risk.In some cases,it also is the only option for overseas brands toenter Vietnam.This is especially applicable when it comes to the industries that have a limit on foreign ownership of the business.Below aresome examples of the
179、 benefits that foreign companies can expect from this collaboration model.Compliance with local regulationsSome industries limit foreign ownership as some industriesthat are considered to be sensitive by the government.Below you can find a handful of industries and the foreignownership limitations:B
180、anking 30%Goods transportation by rail or domestic waterway 49%Goods transportation by road 51%Cargo handling services up to 50%,depending onthe type of cargoTherefore,establishing a JV might be the only way in forforeign companies in certain industries.However,this ismore complicated and requires s
181、ignificantly more resourcesfrom the investors,both in terms of legal documents andhuman capital.Access to local expertiseA great benefit of a JV is that you can utilize the local experience andnetwork of the domestic Vietnamese partner.Foreigncompaniescanestablishtheirfootprintinthedomesticmarketwhi
182、leenjoyingexternalsupportfromsomeone familiar with the market for years.You and yourpartner can then bring your own strengths to further developthe JV.Yourpartnerwillsupportwithrelatedpaperworkanddocumentation,as well as deal with local authorities.They canalsoprovideinsightsaboutlocalpractice,aswel
183、lasestablished relations with relevant stakeholders,such assuppliers and distributors.Meanwhile,theforeignpartnerisexpectedtobringexperience of globalization,technological innovation,andknow-how,which typically are the weaknesses of the localparty.Hence,the addition of a foreign company is considere
184、dacompetitiveadvantageoverlocalpeersinthesameindustry.Legal and regulatory framework(2/3)Source:ARC Group 40Example of Joint Ventures in VietnamUp to now,Honda Vietnam has investedover 400 million USD in the construction of3factoriesincludingtwomotorcyclefactories and an automobile assembly plantin
185、Vietnam,creating jobs for thousands ofworkers.Japan Honda Motor CompanyThailand Asian Honda Motor CompanyVietnam Engine and Agricultural Machinery CorporationHonda VietnamCuu Long JOCYamaha Motor VietnamCALOFIC CorporationPetroVietnam Monacos Geopetrol company SK GroupKorean National Oil Corporation
186、UKs ConocoPhillips Cuu Long Co.LtdAfter the transition to exploitation andproductionin2003,CuuLongJOCalways holds the 2nd position in Vietnamregarding crude oil output and exportrevenue.In 2022,the firms estimated oil-equivalentproductionisexpectedtoreach 25.25 million barrels,earning 1.44billion US
187、D and paying 863 million USDto the State budget.Established in 1998 and operating inthefieldofmanufacturingandassemblingmotorcycles,YamahaMotor Vietnam Company Limited nowhas more than 300 dealers and storesin Vietnam,a strong step up from only33 stores in 1999.Hong Leong Industries Berhad MalaysiaV
188、ietnam Forestry Corporation&Co Do Mechanical FactoryYamaha Motor Company Ltd.JapanCALOFIC is one of the most successfuljointventurecompaniesacrossVietnamandhasspearheadedthemanufacturingandprocessingofvegetable oils in the country.CALOFICoperates over two factories in QuangNinh and Ho Chi Minh City,
189、capable ofan output of 2,300 tons/day-night,andoffices in both Hanoi and Ho Chi MinhCity.Across the nation,almost 1,000people work for the enterprise.Wilmar International(Singapore)Vietnam Vegetable Oils Industry Corporation(Vocarimex)Source:VEAM,Apollo.io,VNA,VIETSOVPETRO,CALOFICVietnam OwnershipFo
190、reign OwnershipLegal and regulatory framework(3/3)41Business Taxes Source:PwC Vietnam,Acclime Vietnam,Vietnam BriefingTax TreatiesDouble taxation avoidance agreements(DTAAs)prevent businesses frombeing double-taxed on their income.Vietnam currently has approximately80 DTAAs signed.These treaties eff
191、ectively eliminate double taxation byidentifying exemptions or reducing the amount of taxes payable inVietnam.Corporate income:For foreign-invested enterprises(FIEs),corporateincome is what is earned from carrying out production and businessactivities in Vietnam.Income earned from Vietnam by FIEsDiv
192、idendsNo treaty benefit applies to dividends under DTAAs as there is nowithholding tax on dividends in Vietnam.Companies are required to fulfilltheir financial and tax obligations in Vietnam before remitting dividends totheir overseas parent companies.This means that the remitted dividendsare after-
193、tax profit which can be taxed again in the other signatorycountries.Most tax and revenue jurisdictions allow tax offset for tax paid inother countries on dividends received.Interest&royaltiesInterest&royalties are taxed around 5%to 10%.Tax on the interest isusually exempt under most DTAA while tax i
194、n royalty income is oftenreduced and ranges from 5%to 15%.Technical,management,and consulting servicesTax on service fees is often withheld at 10 percent,in which 5%is of value-added tax(VAT)and the other 5%portion is CIT.Under DTAAs,only the CITportion is subject to an exemption.Vietnams Double Tax
195、ation AgreementsSummary of Withholding Tax Rates Contained Within each AgreementTreaty PartnerDividends(%)Interest(%)Royalties(%)5/7/12.5105/05/15101010Note:In most cases,the limits set by the DTAAs are higher than the present withholding rates under domestic law;thus,the domestic rates w
196、ill apply.*The refund of excess tax=standard CIT(20%)-the double tax treaties maximum tax rate*The list does not represent an exhaustive list of all DTAAsRefund of excess tax7.5-15%10%5-15%10%Appendix Ecosystem maps43An interconnected economic ecosystem creates solid ground for growth and success of
197、 Vietnams economyVN ECOSYSTEMLOCAL COMPANIESMULTI-NATIONAL CORPORATIONSPE/VCSTARTUPS44LARGEST PUBLIC LOCAL COMPANIES BY SECTORVietcombank-BankingMarket cap$20.94BBIDV-BankingMarket cap$9.96BVINHOMES-Real EstateMarket cap$10.82BVinamilk-Consumer goodsMarket cap$6.47BPetroVietnam Gas-UtilitiesMarket c
198、ap$8.02BSABECO-Consumer goodsMarket cap$4.14BHoa Phat-ManufacturingMarket cap$6.96BVietinbank-BankingMarket cap$6.01B*The list is not ordinal and does not represent an exhaustive list of all entitiesin Vietnam.Source:Crunchbase,Press release,TradingViewa foreign trade bank that provides a wide range
199、 of financial services ininternational trade.a Vietnamese commercial and state-owned bank engaged in the provision ofinvestment banking services for individual customers,corporate customers,andfinancial institutions.a State-owned commercial bank whose traditional services as well as othermodern and
200、valued added services have reached all nation-wide users.has main business in gathering,importing,transporting,storing,processing andtrading of gas and gas productsdevelops and trades integrated residential,commercial and industrial realestate,and provides real estate management and related services
201、.a nutrition corporation providing dairy products,ranging from core dairyproducts to value-added dairy products.a leading beverage company,produces and sell beer,alcohol,beverages andrelated products including material and packaging materialsan industrial manufacturing company focusing on steel prod
202、uction.ItsbusinessincludestradingandproducingFurniture,SteelPipe,Steel,Refrigeration,Real Estate,and Agriculture.Non-exhaustiveDate of valuation:July 21st,2023Ecosystem map(1/4)45Non-exhaustivePE/VC WITH AUM US$50M*The list is not ordinal and does not representan exhaustivelist of all entitiesin Vie
203、tnam.Source:Crunchbase,Press releasea global investment firm that focuses on real estate,infrastructure,digital transformation,food,consumer goods,and technology in VietnamKKR-PEAUM$504Ba private equity firm that focuses on high-growth businesses in Vietnam.Vietnam Investment Group-PEAUM$560Ma leadi
204、ng investment management and real estate development firm in Vietnam.VinaCapital-PEAUM$3.9Ba Vietnam-focused Private Equity firm,specializing in consumer driven businesses such as retail,restaurants,consumer products and distribution.Mekong-PEAUM$490.5Ma leading global private equity firm;one of the
205、 largest PE investors iin VietnamWarburg Pincus-PEAUM$83BGlobalLocala Southeast Asian venture capital firm that brings together knowledge and experience from Silicon Valley with passion and ambition for Southeast Asia.an early-stage VC firm focusing on investing in technology companies in Vietnam an
206、d Southeast Asia.an early-stage venture capital firm on a mission to empower tech entrepreneursin Vietnam.a Vietnam-focused venture capital focusing on investing in and building world-class technology companies and incorporating them into a full digital ecosystem.Golden Gate Ventures-VCAUM US$250MDo
207、 Ventures-VCAUM$50MAscend Vietnam Ventures-VCAUM$64MVinaCapital Ventures-VCAUM$100MEcosystem map(2/4)46a Vietnam-based e-commerce platforms,offering a wide range of products with afocus on providing customers with a convenient and reliable online shoppingexperience.Ecosystem map(3/4)VNLIFE-Fintech-D
208、igital paymentRaised$550MMOMO-Fintech-Digital paymentRaised$434MSTARTUPS RAISED US$20Ma leading digital payment platform in Vietnam,offering secure and convenientelectronic payment solutions to individuals and businesses.a prominent digital wallet and payment platform in Vietnam,providing users with
209、a secure and convenient way to make online and offline transactionsTIKI-Ecommerce-MarketplaceRaised$471MSKY MAVIS-Blockchain-Enabled businessRaised$311MSky Mavis is the creator of Axie Infinity,a popular blockchain-based game thatcombines elements of gaming and decentralized finance,allowing players
210、 to earncryptocurrency by collecting,breeding,and battling digital creatures called Axies.Trusting Social-Fintech-Credit dataRaised$214Ma Vietnam-based fintech company specializes in alternative credit scoring and dataanalytics,leveraging innovative technologies to provide financial inclusion andacc
211、ess to credit for underserved populations.OnPoint-Ecommerce-EnablerRaised$58Ma prominent ecommerce enabler offering a range of services and solutions to helpbusinesses establish and optimize their online retail presence,including websitedevelopment,digital marketing,logistics management,and payment
212、integration.KiotViet-SaaSRaised$51Ma popular point-of-sale(POS)system provider in Vietnam,offering businesses a user-friendly and feature-rich software solution to manage sales,inventory,and customerdata,streamlining their retail operations and enhancing overall efficiency.Buymed-Ecommerce-B2BRaised
213、$63.5Moperates an e-commerce website that connects pharmaceutical manufacturers,distributors,and clinics.Its platform,Thuocsi.vn,works on various projects,includinge-commerce,seller centers,supply portals,WMS,POS,and logistics services.*The list is not ordinal and does not represent an exhaustive li
214、st of all entitiesin Vietnam.Source:Crunchbase,Press releaseNon-exhaustive47Ecosystem map(4/4)Samsung Electronics-ManufacturingInvested$18BLG Electronics-ManufacturingInvested$5.3BIntel-ManufacturingInvested$1.5BHeineken-Consumer goodsInvested$1BNestle-Consumer goodsInvested$730MHonda-ManufacturingI
215、nvested$535MFoxconn-ManufacturingInvested$503MUnilever-Consumer goodsInvested$300MMULTINATIONAL COMPANIES WITH HEAVY ROOT IN VIETNAM VIETNAM*The list is not ordinal and does not represent an exhaustive list of all entitiesin Vietnam.Source:Press releaseis a major subsidiary of the South Korean-based
216、 global electronics giant,Samsung,operating manufacturing facilities and research centers in Vietnam,representingthe largest source of FDI from South Korea into Vietnam.is a subsidiary of South Korean LG Corporation,involved in manufacturing andsupplying a wide range of innovative consumer electroni
217、cs and home appliances inhigh quality.is a key manufacturing and research subsidiary of the US-based Intel Corporation inVietnam,producing and developing a wide range of cutting-edge semiconductorproducts.is a subsidiary brewery as a part of the Dutch Heineken global brand,producing anddistributing
218、high-quality beers to Vietnamese consumers.is a Swiss food and beverage company,offering a diverse range of nutritionalproducts and beverages to Vietnamese consumers.is a Japan-based automotive manufacturer and distributor,producing a widerange of motorcycles and automobilesisaTaiwan-basedconsumerel
219、ectronicsandelectroniccomponentsmanufacturer,known for assembling for Apples productis a British consumer goods company,offering a portfolio of well-known brands inpersonal care,home care,and food products.Non-exhaustiveAppendix Exits49Vietnam IPO Market Overview2022 IPO Fund Raised breakdown by ind
220、ustryIPO Fund Raised in recent years(US$m)The IPO market focus has shifted from Real Estate in 2021tothelocalcapitalmarketdominanceofIndustrialProducts($35.7 million)and Consumer Business($22.3million)in 2022.Consumer Business is foreseen to continue to play a vitalrole,with highly anticipated upcom
221、ing listings from thissector.Specifically,we expect to see a few Retail and FMCGcompanies go IPO in the near future.Vietnams IPO market saw 8 successful listings in 2022.While this islower than the 13 listings recorded for 2021,the amount raised hasmore than quadrupled,from US$15.6 million to US$71.
222、4 million.Top 3 IPO deals in 2022 were Ton Dong A Corporation with US$27million raised,Nova Consumer Group with US$21 million,andGreen Plus Joint Stock Corporation with US$7 million raised.In January 2023,Vietnam witnessed 5 successful IPOs,includingVNG Corporation,Green Plus JSC,Da Nang Public Ligh
223、ting JSC,120Mechanical JSC,Vinatrans DaNang JSC.Source:Deloitte,News article Deals count1138Industrial Products 50%Financial Services 9%Consumer Business 31%Life Sciences&Health Care 10%SnapshotIPO Breakdown By Industry50IndonesiaSingaporeVietnamUnicorn StartupsCountryIndustryEstablishedIPOTime gap2
224、00920022202113 years12 years11 yearsTechnologyE-commerceE-commerce20021201720179 years12 years8 yearsTechnologyTechnologyTechnology2004201320072023TBD*TBD*19 years10+years15+yearsTechnologyE-LogisticsFintechVietnam is expected to witness more IPO caseswithin 2025-2027,lagging a
225、bout 5 years behindregional countries like Singapore and Indonesia.Theestimation is based on:VN strict IPO standardsVietnams current regulations for IPO standards arestill strict to minimize risks for investors,which is notsupportive for startups:Any issuer must have ROE of at least 5%in theyearprec
226、edingtheyearofthelistingapplication.Must have profitability for the 2 consecutiveyears before the year the listing application ismade.VN startup ecosystem is still young vs.peersPeers like Indonesia and Singapore already have well-established startup ecosystems early on.In 2000,techcompanies sproute
227、d up in Vietnam,but it was really in2016 that the countrys startup ecosystem was fullycomplete with all of its components,along with theapproval of Project 844 by the Prime Minister andtechnology improvement(notably the growth of theinternet and social media)VN maturity of financial marketThe time g
228、ap also shows a trend that the maturity ofthe financial markets shortens the time IPO,giventhat those of Singapore and Indonesia are moremature than Vietnams.*To be determined*The list is not ordinal and does not represent an exhaustivelist of all unicornstartups in three countries.Source:Company we
229、bsites,Crunchbase,Press release,Techsauce,Asia Development BankIt is estimated that the domestic public market may become an active channel for local startups in 5 years51Vietnam M&ADateInvestorTargetSectorValue(US$m)StakeJun-20KKRs consortiumVinhomesReal Estate6516%Oct-18SK InvestmentsMasan GroupCo
230、nsumer4749%Aug-18Hanwha Asset ManagementVingroupDiversified403Undisc.May-21Alibaba,BPEAThe CrownXConsumer4006%Dec-18Warburg PincusTechcombankFinancial Services3704%Dec-21TPG,Temasek,ADIAThe CrownXConsumer3505%Jul-19GIC,SoftbankVNPayTechnology300Undisc.Jan-19GIC,MizuhoVietcombankFinancial Services264
231、3%Jun-22Warburg PincusNovalandReal Estate250Undisc.Jul-21General Atlantic,DragoneerVNPayTechnology250Undisc.May-22Shinhan Financial GroupTikiE-commerce9010%*The list is not ordinal and does not represent an exhaustive list of all M&A transactions in Vietnam.As global players become more interested i
232、nSEA region,Vietnam domestic market isexpected to support acquisitions worth of$250M,especially big unicorns.Source:BDA Partners,CafeF,VNExpressNOTABLE VIETNAM M&A TRANSACTIONSInternet/Fintech/GameInvestors:IDG Ventures,Tencent,Goldman Sachs,Temasek,Chiratae Ventures,.Fintech/E-commerceInvestors:GIC
233、,SoftBank,General Atlantic,Dragoneer Investment Group,.Fintech(Payment)Investors:Goldman Sachs,Warburg Pincus,Mizuho Bank,.Game BlockchainInvestors:Mark Cuban,Andreessen Horowitz,Binance,.Appendix Vietnam FTAs53VIETNAM FTAsNotes:(*)The CPTPP Agreement officially took effect on 30 December 2018.The C
234、PTPP took effect in Vietnam on 14 January 2019.(*)RCEP agreement was signed on 15 November 2020 and entered into force on 1 January 2022.(*)The UKVFTA was signed on 29 December 2020.The Agreement has been temporarily applied from 23:00 p.m.on 31 December 2020 GMT or 6 a.m.on 1 January 2021,Vietnam t
235、ime and officially took effect on 1 May 2021Source:EY from Website of WTO Center under Vietnam Chamber of Commerce and Industry at https:/www.trungtamwto.vn/,Vietnam General Consulate Houston.FTAsSigning membersASEAN Trade in Goods Agreement(ATIGA)10 ASEAN member countries(Brunei,Cambodia,Indonesia,
236、Laos,Malaysia,Philippines,Singapore Thailand,Vietnam)Comprehensive and Progressive Agreement for Trans-PacifiC partnership(CPTPP)Australia,Brunei,Canada,Chile,Japan,Malaysia,Mexico,New Zealand,Peru,Singapore,and Vietnam(*)ASEAN-Japan Comprehensive Economic Partnership(AJCEP)10 ASEAN member countries
237、 and JapanASEAN-Korea FTA(AKFTA)10 ASEAN member countries and Korea RepublicASEAN-India ETA(AIFTA)ASEAN member countries and IndiaASEAN-China FTA(ACFTA)10 ASEAN member countries and ChinaASEAN-Hong Kong FTA10 ASEAN member countries and Hong KongASEAN-Australia-New Zealand(AANZFTA)10 ASEAN member cou
238、ntries and Australia,New ZealandVietnam-Chile FTA(VCFTA)Vietnam,ChileVietnam-Korea(VKFTA)Vietnam,Korea RepublicVietnam-Japan Economicvetnam,JapanVietnam-Eurasian Economic Union FTA(VN-EAEU FTA)Vietnam,Armenia,Belarus,Kazakhstan,Kyrgyzstan and RussiaVetnam-European Union FTA(EVFTA)*Good exported from
239、 Vietnam to the EU are still entitled to GSP benefits until 31Vietnam,27 EU member statesRegional Comprehensive Economic Partnership(RCEP)(*)10 ASEAN member countries and Australia,China Mainland,Japan,Korea Republic,and New ZealandVietnam-UK FTA(UKVFTA)(*)Vietnam,the United KingdomAppendix Vietnam
240、Market condition list55Vietnam Market Entry Condition ListSource:Vietnam Law on Investment1Trading goods and services on the list of goods and services on which monopoly is held by the State in the commercial sector.2Press activities and information gathering in any form.3Fishing.4Security and inves
241、tigation services.5Judicial administration services,including judicial assessment services,poste restante services,property auction services,notary services,liquidator services.6Overseas contracted employment agency services.7Investment in the construction of infrastructure of cemeteries and graveya
242、rds to transfer land use rights associated with such infrastructure.8Waste collection services directly from households.9Public opinion polling service(public opinion polling).10Blasting services.11Manufacture and trade in weapons,explosives and supporting tools.12Import and dismantling of used seag
243、oing vessels.13Public postal services.14Goods transshipment business.15Temporary import for re-export business.16Exercise of the right to export,import,and distribution of goods on the list of goods for foreign investors,foreign-invested economic organizations are not allowed to exercise the right t
244、o export,import,distribute.17Collection,purchase and handling of public goods in armed forces units.18Trading in military materials or equipment and supplies for the peoples armed forces,military weapons,technical equipment,ammunition and specialized vehicles used for the army and police;components,
245、accessories,spare parts,supplies and specialized equipment and technology used for their production;19Intellectual property representation services and industrial property assessment services20Services of the establishment,operation,maintenance and maintenance of aids to navigation,water zones,water
246、 areas,public navigational channels and maritime routes;service of surveying water zones,water areas,public navigational channels and maritime routes serving maritime notices;services of surveying,constructing and publishing nautical charts for waters,seaports,navigational channels and maritime rout
247、es;building and publishing marine safety documents and publications.21Navigation services to ensure maritime safety in water areas,water areas and public navigational channels;marine electronic information service.22Inspection(inspection,testing)and certification services for means of transport(incl
248、uding systems,components,equipment,components of vehicles);inspection and issuance of certificates of technical safety and environmental protection for vehicles,specialized equipment,containers,and dangerous goods packaging equipment used in transportation;inspection services and issuance of certifi
249、cates of technical safety and environmental protection for oil and gas exploration,exploitation and transportation means and equipment at sea;technical inspection service of occupational safety for machines and equipment with strict requirements on occupational safety installed on means of transport
250、 and means,exploration and exploitation equipment and oil and gas transportation at sea;fishing vessel registry services.23Natural forest investigation,assessment and exploitation services(including gathering wood and hunting,trapping rare wild animals,management of the sources genes for plants,live
251、stock and microorganisms used in agriculture).24Researching or using genetic resources of new livestock breeds before being appraised and evaluated by the Ministry of Agriculture and Rural Development.25Tourism services,except international tourism services for international tourists to VietnamAppen
252、dix I of Decree 31/2021/ND-CP:Prohibition List(foreign investors are not allowed)56Vietnam Market Entry Condition ListSource:Vietnam Law on InvestmentAppendix I of Decree 31/2021/ND-CP:Market Entry List (foreign investors are allowed with conditions)1Production and distribution of cultural products,
253、including visual recordings2Production,distribution and broadcast of television programs and music,stage performance and motion picture works.3Supply of radio and television services.4Insurance,banking,securities brokerage,and other services related to insurance,banking,and securities.5Postal servic
254、es,telecom services.6Advertising services.7Printing service,publication issuance services.8Measurement and mapping services.9FlyCam services.10Educational services.11Exploration,extraction and process of natural resources,minerals,oil and gas.12Hydropower,offshore wind power and nuclear energy.13Tra
255、nsport of goods and passengers by railway,airway,road,waterway and conduit pipeline.14Aquaculture cultivation or breeding.15Forestry and hunting.16Betting and casino business17Security guard services.18Construction,operation and management of river ports,seaports and airports.19Real estate business.
256、20Legal services.21Veterinary services.22Goods sale and purchase activities and activities directly related to goods trading activities of foreign service providers in Vietnam.23Technical inspection and analysis services.24Travelling tourism services.25Health and social services.26Sports and enterta
257、inment services.27Paper production.28Manufacture of transport vehicles with more than 29 seats.29Development and operation of wet markets.30Commodity Exchange operations.31Domestic LCL collection services.32Auditing,accounting,bookkeeping and tax services.33Valuation services,consulting services on
258、corporate valuation for equitization.34Services related to agriculture,forestry and fishery.35Aircraft manufacturing.36Manufacture of railway locomotives and wagons.37Trading tobacco products,tobacco raw materials,and specialized machinery and equipment for the tobacco industry.38Publishers activiti
259、es.39Ship building,and repair services.40Waste collection services,environmental observation services.41Commercial arbitration services,arbitration mediation services.42Logistic services.43Coastal shipping.44Cultivation,production or processing of rare crops,breeding of rare wild animals,processing
260、and handling of these animals or plants,including live animals and products thereof.45Production of construction materials.46Construction and related technical services.47Motorcycle assembly.48Services related to sports,art activities,performing arts,fashion shows,beauty and model contests,and other
261、 entertainment.49Air transport support services;ground technical services at airports and airports;catering services on the aircraft;navigation information services,aviation meteorological services.50Sea transport services;shipping tugboat ship towing services.51Services related to cultural heritage
262、,copyright and related rights,photography,video recording,recording,art exhibitions,festivals,libraries,museums.52Services related to tourism promotion.53Agent,recruitment and scheduling,management for artists,athletes services.54Family related services.55E-commerce activities.56cemetery business,ce
263、metery services and funeral services.57Airborne seeding and chemical spraying services.58Maritime pilotage services;59Investment sector,business lines under the pilot mechanism of the National Assembly,The Standing Committee of the National Assembly,the Government,and the Prime Minister.57Vietnam Ma
264、rket Entry Condition*Full detail can be found at LEGAL FRAMEWORKS ON DOING INVESTMENT-INVESTMENT PROMOTION CENTER-SOUTH VIETNAM(mpi.gov.vn)Source:Vietnam Law on Investment 2020Briefings of some conditions under Market Entry with condition (Vietnams Law on Investment 2020)(*)Foreign-owned ratio:Forei
265、gn investors have the right to possess unlimited charter capital in a business entity,with a few exceptions:For listed companies,public companies,securities trading organizations,and securities investment funds under law on securities:comply with lawon securitiesFor state-owned enterprises undergoin
266、g equitization or transformation:comply with the provisions of the law on equitization and transformation ofstate-owned enterprises.For other cases:comply with comply with other provisions of relevant laws and international treaties to which the Socialist Republic of Vietnam hasratified.(*)Form of i
267、nvestment:Foreign investors have two main approaches:direct investment or indirect investment.The various forms of foreign investment in Vietnam including:Establishing economic organizations through investment.Investing through capital contribution,purchasing shares,or acquiring capital contribution
268、s.Carrying out investment projects.Investment in the form of a business cooperation contract(BCC).Exploring new investment forms and economic organizations as stipulated by the governments regulations.(*)Scope of investment:In industries and sub-sectors where Vietnam has made commitments and foreign
269、 investors fulfill the investment conditions,the investmentregistration agency will review and approve the IRC or registration of capital contribution,share purchase,or capital contribution of foreign investorsaccording to the Law on Investment.For service sectors and sub-sectors not covered by Viet
270、nams commitments in international investment treaties or specified in the Schedule ofCommitments,but are subject to investment conditions under Vietnamese law,foreign investors must comply with the provisions of Vietnameselaw.58ReportsBain and Temasek,with contributions from Microsoft,“Southeast Asi
271、as Green Economy 2022 Report:Investing behind new realities”Ernst&Young,“Doing Business in Vietnam 2022”Deloitte,“Doing Business In Viet Nam 2022-2023”Do Ventures,“VIETNAM INNOVATION&TECH INVESTMENT REPORT 2023”PwC,“The future of ASEAN:Vietnam Perspectives”Google,Temasek,Bain&Company,“e-Conomy:SEA 2
272、022”World Bank Group,“Ease of doing business 2020”Fitch Solutions,“Vietnam Trade&Investment Risk Report”ISEAS Yusof Ishak Institute,“Vietnams Over-reliance on Exports and FDI”World Bank Group,“Vietnam:Toward a Safe,Clean,and Resilient Water System 2019”KPMG,“Vietnam Supply Chain at a Glance 2021”Min
273、istry of Finance,“Report on equitization process of SOEs over period of 20162018”Deloitte,“Southeast Asia IPO Capital Market 2022 Full Year Report”ASIAN DEVELOPMENT BANK,“VIET NAMS ECOSYSTEM FOR TECHNOLOGY STARTUPS”ReferencesOnline DatabaseCrunchbasePassport Euromonitor Vietnam Ministry of Planning
274、and InvestmentStock information:TVSI,BVSC,Stockbiz.vn,TradingView,I,MarketWatch,Yahoo!FinanceState Bank of VietnamInternational Monetary FundWorld Bank Open DataPhilippine Statistics AuthoritySingapore Department of StatisticsVietnam General Statistics Office59ReferencesOther sourcesTax Incentives|V
275、ietnam BriefingVietnam National Law ARC Group Yamaha Motor Vietnam informationHONDA VIETNAM COMPANYAdditional offshore oil field begins operation|VIETSOVPETRO About CALOFICInstitute for Economics&PeaceGeography of VietNamWTO CenterForeign Policy|About VietnamCrowe VietnamThe Little Data Book on Fina
276、ncial Inclusion 2018|World BankFinTech in ASEAN 2022|UOB Tech EcosystemWHY VIETNAM?HealthTech in Vietnam|InsigniaTaxes on corporate income|PwC VietnamWithholding taxes|PwC VietnamVietnam Double Tax Agreement(2023)|Acclime VietnamAn Introduction to Double Taxation Avoidance in Vietnam|Vietnam Briefin
277、gPrivate Equity 2022-Vietnam|Global Practice GuidesThe Vital Role of the Private Sector in Vietnams Green Financing|ARC GroupVietnam-Country Profile|Export Finance AustraliaVietnam-Country Risk|Allianz ResearchVietnam-Economic Studies and Country Risks|La CofaceAsset-Light Supply Chain|AccentureAsse
278、t-light and flexible freight transportation to enable supply chain of the future|KPMGInfrastructure|Open Development VietnamWhy Invest in Vietnam?In brief:acquisition and exit strategies for private equity firms in Vietnam|Freshfields Bruckhaus DeringerMekong Capitals past investment|Mekong Capital
279、60ReferencesPress releasesTechInAsiaDealStreetAsiaVietnams Bamboo Diplomacy:From Tradition to Innovation(VietnamPlus)Three Vietnamese seaports among TOP 100 largest container ports worldwideShinhan Bank Vietnam To Acquire Anz Vietnams Retail Division|Shinhan BankCJ CGV acquires Vietnams leading cine
280、ma chain(koreanfilm.or.kr)Thai TCC Group becomes new owner of METRO Cash&Carry Vietnam(.vn)Southeast Asias Grab lands$1B from Toyota at a$10B valuation|TechCrunchTPG buys majority stake in Vietnam school,Mekong exits|AVCJSG buyout firm Growtheum invests$100m in Vietnams International Dairy Products(
281、)Thai Beverage unit wins auction to buy 54 percent stake in Sabeco|ReutersCentral Group officially owns Big C Vietnam(.vn)Cuu Long JOC oil production likely to hit 400 million barrels this year|VNArsted plans building 3.9-GW offshore wind farm in Vietnam-report()Vietnam says AES Corp intends to deve
282、lop$13-billion wind farm()Vietnams BCG Energy inks USD-400m MoU with Siemens Gamesa()Sembcorp,BCG Energy aim to develop 1.5 GW of renewables in Vietnam()Warehousing continues to rise unabated in local marketVietnam not ready for looming solar waste issue amid recent boom|climatetrackerVietnam ranks
283、5th in economic openness in Asia:Fitch|Vietnam Chamber of Commerce and IndustryVietnam is fifth most open economy in Asia|VIRDisposal of Big C Vietnam for a valuation of 1 billion euros|Groupe Casino(groupe-casino.fr)Inadequacy in the price mechanism,many solar and wind power projects face great dif
284、ficulties(nhandan.vn)State-owned enterprises-good and bad|Vietnamnet61Legal DisclaimerDisclaimerThis communication has been prepared by Golden Gate Ventures Research Team(“GGV”)for general information only and is not intended to be relied uponin any way.Golden Gate Ventures is an early stage venture
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