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Foreign investors aren’t flinching at Vietnam’s difficulties   2008-06-25 - VNN

Vietnam remains the economy that is thought will see the best growth in the medium- and long-term in Asia. The current difficulties are not preventing big foreign investors from advancing towards Vietnam.


Vietnam the best-growing economy in Asia

Sandy Flockhat, General Manager of HSBC Asia Pacific
Sandy Flockhat, General Manager of HSBC Asia Pacific, who is now in Vietnam to attend the opening ceremony of HSBC’s Hanoi branch and take necessary lobbying steps to debut its 100% foreign-owned bank in Vietnam, said that foreign investors are still coming to Vietnam because they aim at long-term benefit, and because the current difficulties are just temporary. Every country in the world has to overcome these same problems in their development history, he said.

HSBC has been trying to expand its network by opening a Hanoi branch, preparing for the establishment of its 100% foreign-owned bank and raising investments in financial institutions like Bao Viet insurer and Techcombank.
Mr Flockhat said that to date, HSBC has injected more than $500mil in Vietnam’s market, and the figure will increase in the time to come.
Commenting about the difficulties Vietnam is facing, HSBC’s analysts said that Vietnam’s current situation is far different from Thailand’s in 1997. Vietnam’s foreign debts are now at low levels, not as high as Thailand’s in 1997. The analysts cannot see any possibility of the VND being attacked from the outside, as the State Bank of Vietnam still keeps strict control over the purchase and sale of VND and foreign currencies.
Business opportunities should not be missed

Doan Tran De, Managing Director of Societe Generale Asia Pacific
French Societe Generale (SG), one of the world’s leading groups in providing financial services, also said it has a long-term investment plan in Vietnam.

Doan Tran De, Managing Director of Societe Generale Asia Pacific, said that SG has made strong commitments to funding big infrastructure and industrial projects in Vietnam, pledging to make contributions to the long-term economic development of Vietnam, despite the current difficulties originating from high inflation.
SG Bank has funded several big projects in Vietnam, including Phu My 2.2 Power Plant, which is providing electricity to the Electricity of Vietnam at low prices of UScent3-4/kwh.
De said that SG is able to help Vietnamese economic groups and general corporations make investment in energy projects in Russia as the group has purchased a big private bank in the country, Rusbank. SG can also help Vietnamese enterprises expand business in the Middle East, North America and Latin America thanks to the network and prestige of SG in the regions.
Current difficulties just temporary

Namita Lal, Consumer Banking Director for Vietnam, Laos and Cambodia of Standard Chartered Bank
Namita Lal, Consumer Banking Director for Vietnam, Laos and Cambodia of Standard Chartered Bank, stressed that Vietnam’s current difficulties will last a short time.

The bank has recently released its latest report, forecasting Vietnam’s economic growth rate for 2008. However, Ms Namita Lal said that even when Vietnam’s growth rate is lowered to 6.7-7%, Vietnam remains the country with the second- or third-highest growth rate in the region.
Moreover, the current difficulties are not the problems of Vietnam only, but global problems.
Believing that Vietnam’s prospects for the next three or five years remain very promising, Standard Chartered will still move ahead with its plan to expand investment in the country.
The bank is planning to launch retail banking services in July, including services for individual clients and small- and medium-size enterprises in Hanoi.

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