Can Vietnam be the Next China (CNA, 2020)

While USA and China have been sparring over trade tariffs, Vietnam emerged as a clear
winner. The economy of Vietnam has improved by almost 8% because of the shift in
production resulting from the US China trade War.
When the trade War started, first of Vietnam was already well positioned not only
graphically because of its proximity to China but also because of the openness of the county
and the government toward foreign investors.
Vietnam is seen as an economy and Society very similar to China for example its communist
it's a one-party but also in terms of organization.
The proximity to China is one of the reason that led those to move manufacturing
operations to Vietnam instead of abandoning the Chinese market.
Investors are choosing to supplement Chinese operations with no cost inputs source from
production facilities in Vietnam,
The companies had a lot of supply chain exposure just to the China Market or the
China geography but it has been a desire to have a diversification in place so that if
something happened in China that you could have a backup option and also recognition that
as China's wages were Rising so fast it was going to not be as cost-competitive in the future
as it was at the time.
It's about having China still as a very strong part of the of the value chain but it's
about not being completely entirely dependent on China.
The currency is incredibly stable versus the US dollar, growth is strong, inflation is
low the workforce is smart and hardworking and kind of a sweet spot demographically.
There's no question that Vietnam kind of stability and integration in the world
economy that's going to continue . Lots of multinational companies including Intel Samsung
and LG have made huge Investments.
Vietnam Export success story is actually Samsung's manufacturing exports success
story in Vietnam. South Korean companies have been very big investors.
Vietnam has many trade advantages over China, labour costs are cheaper in the
country is a signatory to many bilateral trade agreements. Despite its Trade Surplus with the
United States, the Trump administration's Us phone has been pleased with Vietnam
multibillion-dollar purchases of American Goods.

Can Vietnam be the next China?

China has massive scale, China has been a building infrastructure for three decades
and China has very intense critical mass in certain sectors within the global value chain
Vietnam will never have attraction of an expo manufacturing base with a very
attractive a domestic Market to Service as well as Market is much smaller party that's about
population of but it's also about just very low levels of GDP per capita.
The covid-19 outbreak is also a grim reminder of the extreme concentration of
manufacturing built up in China, Lot of business that left China's not going to come back to
Coronavirus it certainly helps reinforce with a lot of companies which was very risky to rely
too much on one country for your a supply chain or business plan
Chinese firms :Goertek and Luxshare went to Vietnam for producing. Chinese firms don’t
need to do anything in China. Some Chinese firms are moving to China. Thailand and
Vietnam in 2018 had a lot of apple supply chain plans. The growth seems to be more
substantial. Chinese firms are going to Vietnam including the Baby Vietnam.
Apple Watch supplier is Luxshare. Obv Luxshare is made not only air pods in Vietnam but
also in Vietnam. MacBook are made by Foxconn in China. Vietnam is getting quite attractive.
Foxconn is also making an investment of laptop and tablet plant in Vietnam. A lot of scenes
seem to happen. India is also becoming very important. Vietnam is more attractive to
investors than ASEAN-4 because
1) Costs are lower
2) There is a stable gov for macro
3) Politically more stable
4) FTA
5) Supply chain is still in China so being close to China is very helpful.
6) Vietnam has a Confucian heritage: ppl study hard, strong work ethics.
Vietnam is not participating in the performance test around world so we can’t relate abt
education but a lot of Japanese are working oversea. Education system is pretty good in
Vietnam.
Vietnam has also a stable government and also the geographical position of Vietnam.
Vietnam is close. Even if you ship through the ocean there is Shenzhen. Vietnam made it
easier to the countries. Vietnam FTA is also good because it makes goods cheaper.

FTAS
CPTPP ), in italiano Accordo globale e progressivo per il partenariato transpacifico, noto
anche come TPP11 o TPP-11,[1][2][3] è un accordo
commerciale tra Australia, Brunei, Canada, Cile, Giappone, Malesia, Messico, Nuova
Zelanda, Perù, Singapore e Vietnam. Esso si è evoluto dal Trans-Pacific Partnership (TPP), che
non è mai entrato in vigore a causa del ritiro degli Stati Uniti.

 Tutti e dieci i membri dell'ASEAN

o Brunei
o Cambogia
o Indonesia
o Laos
o Malaysia
o Birmania
o Filippine
o Singapore
o Thailandia
o Vietnam
 Tutti e tre gli altri membri dell'Asia orientale dell'ASEAN Più Tre
o Cina
o Giappone
o Corea del Sud
 Altri due membri dell'Oceania dell'ASEAN Più Sei
o Australia
 o Nuova Zelanda

Vietnam has not FTA with the USA but they have some other agreements.
There is also the RCEP with south Korea China, ASEAN, Australia-Japan and New
Zealand.. Whole Asia is inside those trade agreement. Singapore and Brunei they are not
competitive because there is a small population. In terms of agreements with EU we can see
that Japan, Singapore and Vietnam has some. Singapore and Vietnam.
In this sense Vietnam is better than Malaysia. Germany is also a very important country.
In terms of FTA with US Singapore and South Korea have.
CAMBODIA
Cambodia is a least development nation that has low costs and wages. There are programs
for LDC’s with free trade agreement program. EU has the EBA. The Us HAS THE Africa
Opportunity Cost. China when entered WTO started to be an export leader. Canada has also
a clue for that. China has now special agreement for special countries as well. THE LDC in
2018 are mostly in Africa. In Asia we have : Cambodia and others
Laos has a bad position as a LDC because it has land block. NO SEA that allows no sea
transports.
Another way to avoid direct competition with China
This is diversifying into the service sectors.
Philippines
Revenues rises and improved substantially and the growth seemed a little flat. Talking about
population. Maybe automation could help with robot consumers. Maybe as those things are
getting better in the recent year there is an increase. Philippines are good for call centre
because they are kind, good culture and have good English. The India is still dominating in
terms of IT BPO. Philippines is now a more important centre.

Philippines: The World's Call Centre Capital (2012)

In the Philippines there is one industry that is definitely booming: Call centres. There are
800 here and overtaking India which is that quite staggering and that is why the Philippines
has become known as the Call Centre capital of the world. 25-30% COMPARING to India
that is growing of ---%
In 2002 there was probably about 40 or 50 thousand employees in this industry, now the
employee are over about 600,000 in this eleven billion dollar industry.
It’s hard to find families that don't have one person employed in the call centre industry today
so it's really important cuz you know they don't see you so it is all in your voice and the way
you speak after that making sure that you're really listening and you care about their
concerns and evening for a few know you are on the phone right now and then I know
exactly where
Filipino culture is made of ppl nice and friendly . It’s important to have the empathy
Employers got class a week-long about the US culture forms of government and U.S.
currencies to give them a little bit more attuned to the Western culture.
PPL are different, ppl in New York talk faster as compared to the southern areas would be a
little more homely and be more casual you speak. This is a booming industry here it is
growing something like twenty-five to thirty percent each year in comparison to India that
grows only 10
Tourism in SE Asia.
Tourism in the SE is interesting for Thailand tourism. People are spending a lot of money in
Thailand when arrived. People spend a lot of money in Thailand. Thailand is doing
experience tourism, they know how to market products. They are trying to attract the
honeymoon. PPL in the honeymoon spend money. They also offer spa and bars. Thailand is
a specialized tourist destination. Thailand is also great for medical problems. Thailand
surgery can be very advantageous. The most famous is the Bumrungrad is an hospital with
great food. Thailand food is very good.
Thailand hospital
1.1 million visitors, there are translators for foreigners- Most of the doctors are American
birth certified. Efficiency is number one here. There is also aesthetic and cosmetic
surgery. Thai tourism has also a good nursing service. In Thailand the service level is
very good. Thailand med tourism is very great. The service level is very high. In Thailand
the cosmetic surgery is great. A lot of companies in SE in their welfare packages offer
these packages.

Thailand Plans international medical tourism in Phuket is one plan for developing.
Singapore
Singapore was born as an independent republic in August 9 1965 as a result of being
expelled from Malaysia. Singapore prospect at first were not good. It was thee country of
recent immigrants, tiny, under developed and with No resources. The country 1st prime
minister made the nation. He made it from 3rd world to 1st.

It is a very small country that became a very rich nation. The strategic position
helped. The port is in the Malacca strait where 40% of total good go and return.
Singapore made the largest trans-shipment centre. It is one of the most dynamic
region. Singapore welcomed foreign investments, and foreign trade. Multinationals
found Singapore as a national hub. Singapore gov was super-efficient. The country
doesn’t allow social protests. Singapore still makes problem for the freedom. This is
a place where product get divided in smaller pieces. There are countries that ship to
other countries. You need to divide after goods.
Singapore as a Petrochemical Giant
Singapore is strategically situated at the mouth of the critical Malacca Strait (see Figure 1), through
which about 40% the container shipment3 and nearly one-third of the oil tankers4 in the world pass.

The port of Singapore the world's busiest transshipment hub5 , where large volume of shipments get
consolidated or divided before being transported to a final destination. Singapore takes full
advantage of this opportunity

Given the fact that a large portion of the crude oil tankers from the Middle East anchor at the port of
Singapore before the oil is transhipped to other East Asian destinations, Singapore made the
decision to build the infrastructure for oil refineries and storages in the Jurong Island (See figure 2)
and to open the door for investment from global petrochemical firms

The tiny nation without a drop of crude oil becomes a major player in the petrochemical industry. To
meet storage demand, Jurong rock caverns were built. Size of 600 pools

Singapore as the Master Architect of Modern Cities

Public housing is often considered low quality. It is different in Singapore. About 80% of
Singaporeans live in public homes. Singapore fixed the housing problems from a situation
left in 1959 by British in which there was a very housing crisis. The city was struggling to
accommodate its population. In 1960 the HDB ( Housing Development Board) was set with
the mission of setting rental units for the poor.
Many immigrants were living in not hygienic places. Then an unexpected big fire came and
an area of 400.000 was razed. The gov relocated and started to re project the area.
By 1965 the HBD built over 51k apartments, rehousing 400k ppl. HBD started also to sell
them in 1964. Singaporeans are required to save part of their salary in the state managed
plan called Central Provident Fund. At first it only provided for retirement. Then in 1968 the
gov allowed the use of the fund for housing expenses. Unlike other countries, the public
housing is not only for poors. There are up-markets houses with gym and swimming pools.
Houses are usually 20 to 30 percentage cheaper than those in the private market.
U have to apply first, wait years for the apt to be built, then u have to occupy it for at least 5
years and then u can even eventually sell it.
Today HDB has planned and designed over 1 million apt. The percentage of ppl living in the
public houses has grown from the 9% of 1960 to the 82% of 2016.
Singapore has to be very economical and efficient in land utilization, and at the same time,
ensure that its people have adequate, clean, safe and affordable housing
They have to be more inventive than most other countries in making every inch of the land
count, Singaporeans have also learned to be extraordinarily apt at building smart and
integrated spaces for working, living, and playing.
JURONG INNOVATION DISTRICT
Jurong INNOVATION DISTRICT IS A NEW VIBRANT DISTRICT THAT IS GONNA BE
HOME OF THE ENTERPRISES AND TECHNOLOGY for more than 100k ppl.
It’s going to be a mix of spaces for living, spaces for learning and spaces for working.
It will be home for the RD and many labs for researching.
JID will develop the district in several phases over the next 20 years. The development
planning and engineering work for the first phase of JID is in progress, and is targeted for
completion around 2022. At this point, firms that have already committed to set up
operations in JID includes German conglomerate Siemens; American multinational
Flowserve; German engineering firm Bosch Rexroth; Singapore-listed motion control
systems specialist ISDN; the Agency for Science, Technology and Research's (A*Star)
Singapore Institute of Manufacturing Technology; as well as the National Metrology Centre.
Why so Many FNUs from Indonesia?
Indonesia is the world’s fourth most populous country,1 home to over 272 million inhabitants. 2 The
17,000 islands that comprise the nation3 encompass more than 300 ethnic groups. The largest of
which are the Javanese, concentrated on the most densely populated island of Java,4 accounting for
45% of Indonesia’s population.

Many Javanese do not have a surname.6 The Western concept of “first name,” “middle name,” and
“surname” does not exist in the Javanese culture. In fact, the Indonesian government does not
legally recognize family names. 7 A common name structure is a mononym -- a name composed of
only a given name and no surname. 8 A well-known example of a Javanese with a mononym is
Sukarno, Indonesia’s first president  Sukarno

Another common name structure is for an individual to have two or three given names and no family
name. Given the cultural preference for creating unique given names with varied structures, and the
custom that women usually retain their own names after marriage, members of a Javanese family
unit often do not share any common name components.12 As a result, given names are used as
primary identifiers for individuals in Indonesia.

These unique naming conventions pose logistical complications for many Indonesians when traveling
or immigrating to Western countries, where both a given name and a surname are usually required
on legal documents.To fix this issue, the U.S. State Department assumes one’s given name is “FNU,”
standing for “First Name Unknown,” while one’s original Indonesian name is recorded as their
surname.

Canadian government typically documents one’s given name as their surname name while leaving
the first name field blank.

Many of the countries goods go to SE Asia. Singapore earn a lot of money. It

increases the logistics and a lot for currency. Singapore is a free port. It has to be a
free port for being the largest trans-shipment centre. Singapore is a free port. In
Singapore there are also great financial services. They took advantage of location
very well.
IT is also a large bunker port that is a place where u can add gas. Singapore has a
very healthy petro chemical industry. Singapore became a giant of the petrochemical
industry. Because of Singapore petrochemical and oil storage- There is also another
reason that is that in Singapore they buy gas in advance to have stable prices.
Singapore has oil and it allowed Singapore to become a oil trade centre. Singapore
price is still the same in few months. Secondly is also the banking centre that makes
Singapore make advantage of that. Singapore has also a capability in building smart
cities. Singapore is very small so they learnt how to use the land smartly. There are
other projects of biopolis research complex, biotech farms, innovation centres and
etc. The capability should be a service, there is a case that Singapore to become a
rich country had to become an exporter for competencies like the one of exporting
smart cities out of the area like the one in China.
China new city
It is in southern China and it is called Sino Singapore Guangzhou smart city. It is
formally home of some residences. This city has grown in few years. Guangzhou is
the China third largest city. Knowledge cities started when 80k ppl.
The first spaces are allocated wisely, there is a sense of achievement. Singaporeans
know how to build a country. In Singapore it is the same.
The idea is not just to create a club but also to create a model. It is also one of the
smartest city. There is this smart city, China itself is creating great new buildings.
Singapore can offer to CHINA how to manage the cities. It is encouraging some
firms in Singapore to install their firms and grow their companies there. It is creating
hubs for intellectual property. China has a massive population that can be attractive
to a such big market.
Singapore wants to put research in China to have more people to use for testings.
China population don’t have a lot of medicine. In China of people have a good
testing. HK is a region part of China. In the last decades HK has not changed. Hk is
a financial centre. China is getting more sophisticated and without new gates HK will
not prosper. HK is part of China, it is near. Why Singapore and not HK? There are
not reasons for HK not doing that. There is a problem in HK. They don’t think about
mainland China as an opportunity but as an invader.

How U.S. bike companies are steering around Trump's China tariffs

U.S.-based bicycle manufacturer Kent International has found a way around

President Donald Trump’s tariffs - by shifting production out of China.
Like almost all U.S. bike makers, Kent has long relied on low-cost Chinese labor and
parts, but Trump’s tariffs have so far inflated its costs by about $20 million annually.
The company now plans to make bike frames in Cambodia while continuing to buy
about half the components it will attach to those frames from producers in China.
The resulting bicycles can enter the United States tariff-free because of U.S. rules
that generally allow products to be designated as made-in-Cambodia as long as 35
percent of their costs for parts and labor are derived from that country. China,
undermining the Trump administration goal of boosting U.S. manufacturing
employment. It further shows how quickly light manufacturers with less capital-
intensive operations can move to Southeast Asia, which has seen a blitz of new
investment since Trump launched his first tariffs last spring.
Bike industry plays a small role in what experts call the biggest shake-up in cross-
border supply chains since China joined the World Trade Organization in 2001.
Companies in an array of industries - furniture, electronics, apparel, tires, vacuum
cleaners, to name a few - are moving operations to Vietnam, Thailand and other
Asian countries, often while continuing to use some suppliers in China.
Three decades ago, when Kamler first offshored Kent’s production, the firm’s labor
costs in China were a tenth of those in the United States, he said. Now, workers in
China make about a quarter of their U.S. counterparts.
l manufacturers face challenges in moving their operations to Southeast Asia,
including constraints on port capacity and labor. And no country can easily supplant
China’s scale and production volumes for bicycles after three decades of the industry
migrating there from the United States.
Chinese authorities are keen to protect manufacturing jobs, too. To cushion the
impact of tariffs, China has increased export tax rebates and quickened tax refunds
to exporters
Each of the two biggest ports in Vietnam, for instance, has only a sixth of the
capacity of the port of Shanghai, and Cambodia lacks a deep-water port to
accommodate larger vessels.