Vietnam’s importing, exporting and investing activities with Africannations are increasingly bustling as the continent proves a fast-growingmarket.
The Vietnam Business Forum had an interview withChairman of the Vietnam - Africa - Middle East Forum Le Dang Dung, whois also Deputy General Director of Viettel Telecom Group, on thisaspect.
* How do you assess the attractiveness of the African market to Vietnamese enterprises?
According to statistics released by the Foreign Investment Agencyunder the Ministry of Planning and Investment, more and more Vietnamesecompanies are investing in Africa. In addition to State-ownedenterprises (SOEs) with powerful financial resources, more privatecompanies are now interested in this potential market. Fields in Africaattracting investment are also increasingly diversified. From 2002 toAugust 2012, Vietnam's direct investment capital to Africa reached 711million USD. Meanwhile, African countries also started investing inVietnam, but the amount of capital was very modest, totalling just 67.76million USD.
* So, do you think this is a good time for Vietnamese enterprises to invest in Africa?
The Party and Government of Vietnam have issued many policies tofoster ties with African countries on both political and economicspheres. So, I think this is a favourable time for Vietnameseenterprises to invest in the African market.
Beside politicaldiplomacy measures with African countries, I think that the economicdiplomacy trend is a necessary and right step because good bilateraleconomic relations will of course help strengthen good politicalrelations.
Enterprises play a particularly important role inforeign economic activities. There are two levels of external economicrelations. The first level is trade and commodity-exchange relations.The second level is higher, that is, investing directly in the partnercountry. Encouraging Vietnamese enterprises to invest abroad,particularly in high potential markets like Africa, Latin America andSoutheast Asia, especially in poor countries with living standards equalto or lower than Vietnam, provides huge opportunities for Vietnamesecompanies.
* In which areas can Vietnamese companies invest in Africa?
They are agriculture, forestry, fisheries, garment - textile, andconsumer goods. These are fields needed by African countries and inwhich Vietnam is strong. Secondly, African countries have good sentimentfor Vietnam. They admire Vietnam for the victories in two modern warsrenowned to the world; thus, the image of Vietnam is very good in theeyes of Africans. Thirdly, Vietnamese enterprises can now easily accesshigh-level officials of the host country to learn more usefulinformation about investment processes.
However, currently,information about Africa is very limited. So, we often feel that Africais a remote place where economic life is difficult and weather isinclement. In addition, many people fear cultural differences,especially payment issues, because it is quite difficult to convertlocal currencies into hard currencies to circulate in otherinternational markets or bring to the home country. Besides, their localcurrencies are unstable and frequently devalued.
* How do you address this issue?
In my opinion, the Government, the Ministry of Foreign Affairs, theVietnam Chamber of Commerce and Industry (VCCI) and other agencies needto provide more information, and introduce effective orientationpolicies for specific fields in different countries, especially thecountries with good investment incentives, to Vietnamese enterprises.Specifically, they need provide detailed information about investment inthis market like which country is good for agricultural investment,which country is good for seafood investment, which country is good forapparel and motorcycle production investment.
Besides, Vietnam's banking system needs to work out solutions to overcome payment difficulties against enterprises.
At the government level, Vietnam and African nations need to reachagreements to a level that is supportive and protective to Vietnamesecompanies in Africa.
According to my point of view, if we letenterprises do this on their own, it will be very difficult for them andthis approach is definitely ineffective.
In addition, anothermajor difficulty is that Vietnam almost has no trade missions in Africa.Hence, there is a need for early establishment of such agencies tosupport Vietnamese enterprises to do business in this market.
*As a top leader of a very big business with profound experience inoverseas investment, especially in Africa, would you mind sharing someexperience drawn from actual business practices in this market?
In my opinion, there are three points that Vietnam now needs to be very careful about and focus on when investing in Africa:
Firstly, they must do meticulous research on the market they want toinvest in. For example, in the telecommunications sector, before makingthe investment decision, Viettel learned very well about the market likephone service charge and service quality of potential rivals and otherfactors to determine our customer groups and competitive strategies. Inshort, we need all information about the market and industry where weintend to do business.
Secondly, we need to establish goodrelationships with high-ranking officials of the host country. If weplan to invest dozens of millions of US dollars, we need to meetdirectly the President or the Prime Minister of the host country. If wehave not done that, we had better not make investment decision.
Thirdly, we need to prepare enough quality human resources andenthusiasm to work in such a remote place. I emphasise that the initialframework in a new market is a crucial factor to success. Therefore, weneed to pay special attention to this issue. For example, when Viettelintended to invest in an African nation, it brought a very good line-upto the targeted market from another Africa nation. This force willquickly assume their positions and jobs because they have basicunderstanding of foreign languages, working practices and habits,culture of indigenous people. This also helps build up the sympathy ofthe Government and people of the host country.
If a company wantsto invest in a country where Viettel is present, we are always willingto help on all sides with all our best, because we at all times want tobuild up a powerful Vietnamese business community there and achieve moresuccess on the world market, thus helping Vietnam enhance its image onthe international arena.-VNA
The Vietnam Business Forum had an interview withChairman of the Vietnam - Africa - Middle East Forum Le Dang Dung, whois also Deputy General Director of Viettel Telecom Group, on thisaspect.
* How do you assess the attractiveness of the African market to Vietnamese enterprises?
According to statistics released by the Foreign Investment Agencyunder the Ministry of Planning and Investment, more and more Vietnamesecompanies are investing in Africa. In addition to State-ownedenterprises (SOEs) with powerful financial resources, more privatecompanies are now interested in this potential market. Fields in Africaattracting investment are also increasingly diversified. From 2002 toAugust 2012, Vietnam's direct investment capital to Africa reached 711million USD. Meanwhile, African countries also started investing inVietnam, but the amount of capital was very modest, totalling just 67.76million USD.
* So, do you think this is a good time for Vietnamese enterprises to invest in Africa?
The Party and Government of Vietnam have issued many policies tofoster ties with African countries on both political and economicspheres. So, I think this is a favourable time for Vietnameseenterprises to invest in the African market.
Beside politicaldiplomacy measures with African countries, I think that the economicdiplomacy trend is a necessary and right step because good bilateraleconomic relations will of course help strengthen good politicalrelations.
Enterprises play a particularly important role inforeign economic activities. There are two levels of external economicrelations. The first level is trade and commodity-exchange relations.The second level is higher, that is, investing directly in the partnercountry. Encouraging Vietnamese enterprises to invest abroad,particularly in high potential markets like Africa, Latin America andSoutheast Asia, especially in poor countries with living standards equalto or lower than Vietnam, provides huge opportunities for Vietnamesecompanies.
* In which areas can Vietnamese companies invest in Africa?
They are agriculture, forestry, fisheries, garment - textile, andconsumer goods. These are fields needed by African countries and inwhich Vietnam is strong. Secondly, African countries have good sentimentfor Vietnam. They admire Vietnam for the victories in two modern warsrenowned to the world; thus, the image of Vietnam is very good in theeyes of Africans. Thirdly, Vietnamese enterprises can now easily accesshigh-level officials of the host country to learn more usefulinformation about investment processes.
However, currently,information about Africa is very limited. So, we often feel that Africais a remote place where economic life is difficult and weather isinclement. In addition, many people fear cultural differences,especially payment issues, because it is quite difficult to convertlocal currencies into hard currencies to circulate in otherinternational markets or bring to the home country. Besides, their localcurrencies are unstable and frequently devalued.
* How do you address this issue?
In my opinion, the Government, the Ministry of Foreign Affairs, theVietnam Chamber of Commerce and Industry (VCCI) and other agencies needto provide more information, and introduce effective orientationpolicies for specific fields in different countries, especially thecountries with good investment incentives, to Vietnamese enterprises.Specifically, they need provide detailed information about investment inthis market like which country is good for agricultural investment,which country is good for seafood investment, which country is good forapparel and motorcycle production investment.
Besides, Vietnam's banking system needs to work out solutions to overcome payment difficulties against enterprises.
At the government level, Vietnam and African nations need to reachagreements to a level that is supportive and protective to Vietnamesecompanies in Africa.
According to my point of view, if we letenterprises do this on their own, it will be very difficult for them andthis approach is definitely ineffective.
In addition, anothermajor difficulty is that Vietnam almost has no trade missions in Africa.Hence, there is a need for early establishment of such agencies tosupport Vietnamese enterprises to do business in this market.
*As a top leader of a very big business with profound experience inoverseas investment, especially in Africa, would you mind sharing someexperience drawn from actual business practices in this market?
In my opinion, there are three points that Vietnam now needs to be very careful about and focus on when investing in Africa:
Firstly, they must do meticulous research on the market they want toinvest in. For example, in the telecommunications sector, before makingthe investment decision, Viettel learned very well about the market likephone service charge and service quality of potential rivals and otherfactors to determine our customer groups and competitive strategies. Inshort, we need all information about the market and industry where weintend to do business.
Secondly, we need to establish goodrelationships with high-ranking officials of the host country. If weplan to invest dozens of millions of US dollars, we need to meetdirectly the President or the Prime Minister of the host country. If wehave not done that, we had better not make investment decision.
Thirdly, we need to prepare enough quality human resources andenthusiasm to work in such a remote place. I emphasise that the initialframework in a new market is a crucial factor to success. Therefore, weneed to pay special attention to this issue. For example, when Viettelintended to invest in an African nation, it brought a very good line-upto the targeted market from another Africa nation. This force willquickly assume their positions and jobs because they have basicunderstanding of foreign languages, working practices and habits,culture of indigenous people. This also helps build up the sympathy ofthe Government and people of the host country.
If a company wantsto invest in a country where Viettel is present, we are always willingto help on all sides with all our best, because we at all times want tobuild up a powerful Vietnamese business community there and achieve moresuccess on the world market, thus helping Vietnam enhance its image onthe international arena.-VNA
