43 percent of US companies want to expand their business in Vietnam, the second highest rate among ASEAN countries
Among the ten countries of the Association of Southeast Asian Nations (ASEAN), Vietnam is American businesses' second choice for expansion after Indonesia, a recent survey conducted by the American Chamber of Commerce in Singapore has shown.
Indonesia, Vietnam, Thailand and Myanmar were the most popular locations for business expansion while Brunei and Laos were the least, according to the AmCham Singapore's ASEAN Business Outlook Survey 2014.
43 percent of American firms said they want to expand their businesses in Vietnam. The rate is 49 percent in Indonesia and 40 percent in Thailand.
Among those American companies that want to enlarge businesses in Vietnam, 77 percent said they want to expand their own business, 4 percent wanted to contract, 18 percent said they would remain the same, and the rest said they do not have a clear plan yet.
Vietnam is a market with a lot of potentials, especially for beverage firms, Ahmet Bozer -- Chairman of Coca-cola International -- told Cong Thuong (Industry and Trade) newspaper.
Coca-cola is now hiring around 15,000 employees in Vietnam and is planning to hire 500 more, he said.
Mary Beth Tuner, Deputy Economic Counselor of the US in Vietnam told Cong Thuong that many US investors are thinking of switching their business from China to Vietnam as production costs in China have been increasing.
She highlighted the participation of Vietnam in negotiations for the Trans-Pacific Partnership (TPP) trade deal, saying it has strengthened the confidence of American firms to invest in Vietnam, even with those who have not done business in Vietnam and just intend to do so.
The TPP, whose member countries account for nearly 40 percent of the global economy and one-third of all world trade, aims to eliminate barriers to goods and services and address issues including the movement of electronic data, market access for financial firms, and copyright protection.
Tariffs on most goods traded between members will be zero over 10 years, while other free trade and bilateral agreements allow open markets and cut taxes on a more limited range of goods.
Planned to be finished by the end of this year, TPP negotiations see participation of 12 nations including Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the US, and Japan.
The participation of Vietnam in TPP negotiation shows that the country has committed to improve transparency in doing businesses, which will increase its attractiveness for investment and make Vietnam stand out in comparison with other countries in the region that are not a part of the trade talks, said Tuner.
After Vietnam becomes a member of TPP, investors will also enjoy tax cuts and the trade turnover between Vietnam and the US will be much higher than the US$25 billion recorded last year, she added.
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