Vietnamese government wants to have Nike s advanced skills and technology and to transfer them to local people. Vietnamese government may try to solicit Nike a joint venture so that Nike may transfer its skills and technology to local industries through the government and the labourers. Vietnamese government does not want Nike to exploit Vietnamese rule. Thus, Vietnamese government may set up some regulation, such as minimum percentage of direct investment, requirement of Vietnamese materials for producing shoes and exportation requirement set up at a certain amount of money. Currently, Vietnam is enjoying the position as the favourite state for investment.
Labour cost is cheap.
The government is becoming more and more open. However, Vietnam will go though the same path as China or South Korea. Someday, when Laos and Cambodia are open to the world market for investment purposes. Labour cost there will be cheaper. Nike has the edge in terms of the bargaining power because Nike is a member of manufacturing industries.