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Opportunities and challenges for Vietnamese businesses in today’s market economy

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CONTENTS

INTRODUCTION1

OPPORTUNITIES2

CHALLENGES3

CONCLUSION4

INTRODUCTION

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At the end of the 20th century, Vietnam fell into a severe recession, the company slowly moved meanwhile the living standard of Vietnamese remained very low .

Before the urgency of the economic environment, politic systems determined to make the country's economy to be the socialism-oriented market one.

Since then our economy has faced many opportunities and challenges namely.

OPPORTUNITIES

Vietnam has a large population, the percentage of working-age people who are hard-working, creative and be capable of absorbing new technologies but require low salary.

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OPPORTUNITIES

Market economy represents a free and

high competition -> to renovate the

organization and management systems.

=>generates manufacturing forces, creates

a surplus of goods

Economic integration has created an

opportunity country’s resources to

communicate with the out side word

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OPPORTUNITIES

Market economy provides a mechanism of training, selection

and using of the active and efficiently managers meanwhile

eliminating the bad ones.

Market economy offers a free and comfortable business

environment which always protects the customer's rights.

In the trend of globalization, Vietnamese’s business can expand

overseas investment with easier procedures as well as more

freedom

2. Market economy

Group 2OPPORTUNITIES

Vietnamese’s businesses are able to enlist the international conditions to exploit the economic potential of the country country. Vietnam is rich in natural resources.

3. Attract foreign investment

Vietnam has chance to boost economic integration process in terms of international peace country, political- social stability. This is a very important opportunity to focus economic development and expand of external relations.

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OPPORTUNITIES

Learn how to manage the business of leading, open opportunities for

Vietnamese enterprises to endeavor to raise the production capacity

business.

Acquire advanced technology, modern technology and contribute to

promote faster progress of industrialization and modernization of the

country

Expand exchanges with business in the area.

Access to many different cultures from

which we will have more knowledge about

the habits, their culture

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OPPORTUNITIES

International agencies/media owners

setting up offices in Vietnam

Increase levels of investment

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CHALLENGES

Competition in international market

Competition in the domestic market

Human resources

Technology and infrastructure Competitors

Public institutions

Economics

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CHALLENGES

1. Competition in international marketVietnamese commodities, when accessing to international market, have to compete with those from more developed countries. In a backward agricultural economy that is characterized by the exploitation of natural resources

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CHALLENGES

2. Competition in the domestic marketIn the domestic market, Vietnam has to face with a lot of problem rising from the liberalization of economic sectors in the committed intergration process. Many industrial and agricultural products are less competitive compared with those imported from EU, US, Japan, China and ASEAN

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CHALLENGES3. Human resources

Vietnam has abundant human

resources, but

proportion of skill labor is still very low

Lack of local talent

Potential of Vietnam material is weak, human resources are

generally abundant but not

highly skilled

Due to the level of

knowledge and

business of

fledgling businesses

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CHALLENGES

4. Technology and infrastructure of Vietnam business

Vietnam's technology is backward, weak management capabilities and business capabilities, production capacity.

Infrastructure: The local infrastructure still has a long way to go. For example, the international bandwidth is extremely limited so Vietnamese faces very bigchallenge when they want to access international portals/sites.

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CHALLENGES

High-quality foreign goods to be tax cut, which makes goods of Vietnam is now fiercely competitive

Competitors

In the external economic relations, the highest potential countries may contain negative factors such as curbing or compulsion Vietnam to change direction

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CHALLENGES

Despite of great endeavor of the State, the institution reform in Vietnam is

carried out very slowly. The legal system is inadequate, asynchronous, not

detailed, inconsistent, and not close to the reality so that it is hard to be realized.

There lack fundamental laws of a market economy like law of competition and

law of intellectual copyright. Some laws are irrelevant with the market economy

6. Public institutions

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CHALLENGES

7. EconomicsThe level of economic development,

political and social institutions, culture in different countries

When switching mechanism from a centrally planned to a new method is also the most embarrassing in international competition

The process of economic restructuring has been slow, the pace of reform of strate enterprises is slowand still follows the olds way, the business performance of strate enterprises is limited

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CHALLENGES

The implementation of policies, especially the major economic partners of Vietnam

There are still many problems in improving economic growth, such as productivity, competitiveness, quality of human resources, infrastructure…

Lack of transparency in business environment

At the same time it’s prohibited local companies to attract foreign talents

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CONCLUSION

Vietnam has witnessed fundamental changes during 13 years of

comprehensive reform towards market and the world economy

The Vietnamese Government has realized the need of further

changes to fulfill the task to transform into a market economy,

maintain high and stable economic growth rate, and

comprehensively integrate into the world economy.

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