Newsgroups: bit.listserv.seasia-l
Date:         Sun, 30 Aug 1992 16:06:33 -0400
From:         Nhan Tran <tran@PEORA.SDC.CCUR.COM>
Subject:      NEWS/VN: Making it in Hanoi
X-To:         FISHLM%SNYBUFVA@pucc.princeton.edu, scv@media.mit.edu,
              seasia-l@msu.BITNET, vietnam@cco.caltech.edu, vn-news@saigon.com

08/28

Making It in Hanoi

Copyright, 1992. The Associated Press. All rights reserved.

By DENIS D. GRAY
 Associated Press Writer
   HANOI, Vietnam (AP) -- Hoang Van Nghien planted a dynamic capitalist company
in communist ground, where he turns out robot parts, seeks other profit
opportunities and instills Japanese-style company spirit in his employees.
   Hanel Corp., with more than $2 million in assets, assembles videocassette
players and other consumer electronics under license from South Korean and
Japanese giants.
   Nghien, an electronics engineer, said his company also gets more overseas
orders than it can handle for such items as Japanese robot components.
   To accumulate hard currency, Hanel recently invested in factories that export
shrimp and silk. To forge the 350 workers into a dedicated team, his managers
follow the Japanese model, throw parties, attend weddings and hand out bonuses.
   Optimistic foreign businessmen point to such growing enterprises as Hanel to
support their contention that Vietnam will follow Taiwan, South Korea, Hong Kong
and Singapore to become Asia's next economic dragon.
   They cite its largely untapped natural resources, traditional work ethic, low
labor costs and an entrepreneurial spirit pent up through decades of war and
communism. Nghien noted that Japanese workers are paid the equivalent of $2,000
a month for the same work his employees do for $35.
   "There are billions of dollars in business opportunities in Vietnam," said
Raymond Eaton, an Australian businessman. "I'm quite convinced that Vietnam is
going to be a real key player in the region."
   Eaton's Export Development Trading Corporation does $5 million to $6 million
of business a year in textiles, handicrafts and commodities trading. He recently
signed a joint-venture agreement for a gem-cutting and trade operation.
   Like other businessmen, Eaton is positioning himself in the market rather
than putting in a lot of investment capital, awaiting what some believe will be
a big breakthrough by Vietnam.
   They expect that to come, possibly next year, when the United States lifts
its trade embargo and its blockage of loans from international financial
institutions.
   The World Bank, International Monetary Fund and Asian Development Bank are
expected to make billions of dollars in loans to rebuild Vietnam. Renovation of
roads, harbors, airports and power plants will spawn a host of business
opportunities, or so Vietnamese and foreign businessmen hope.
   "Once the Americans press the green button, there's going to be
transformation overnight," Eaton said in an interview. He added that big
investors will shy away until Washington and the World Bank approve.
   Vietnam has experienced steady growth since it began capitalist-style
economic reforms in 1986. Up to $2.1 billion in foreign investment is expected
this year, an increase from $1.8 billion in 1991, said Nguyen Mai, vice chairman
of the State Committee for Cooperation and Investment.
   Singaporeans are building condominiums, Taiwanese are laying out a 36-hole
golf course, Thais are prospecting for minerals and the French are renovating
hotels for a growing tourist industry. Half a million foreign visitors are
expected this year, compared to 150,000 in 1989.
   By the end of this year, Vietnam will have granted 25 licenses to foreign
companies to explore for oil.
   Problems still abound, however, including a cumbersome bureaucracy with
little experience of Western-style business and countless regulations apparently
perpetuated by the communist old guard.
   Investors complain that they need permits to travel within the country, must
go through official channels to hire staff, cannot live where they want and
suffer what consultant Christopher Bruton called other "ridiculous levels of
control."
   "Our biggest obstacle now is an incomplete legal framework," said Mai, the
government official. "Serious investors feel uneasy, and ones who aren't serious
take advantage of the loopholes."
   Bruton, who is based in Bangkok and specializes in Vietnam, said major
changes are unlikely until the old Communist Party faction is gone.
   He also noted some purely economic stumbling blocks: The extent of Vietnam's
oil reserves are still unknown, poverty and a woeful infrastructure will retard
development and the limited agricultural land probably will not feed a
population expected to reach 80 million in this decade.
   "It's hard to see how a country with a per capita income of $200 can turn
itself into an economic powerhouse in a short length of time," Bruton said.
   Many Vietnamese also are cautious, expecting growth but no miracles.
   "Training workers who can run machines is easy, but learning how to run a new
society takes a long time," said Nghien of Hanel.
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