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Vietnam Country Risk Profile SAMPLE

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Vietnam STR-RS Risk Score: Intermediate Risk (63.59 out of 100) Global Risk Ranking: 171st out of 193 countries The country’s first export processing zone was created in 1991. Since then, a series of industrial, export processing, hi-tech and economical zones have been established along with the increase in foreign investment. The number of laborers working in enterprises in these zones nation-wide is approximately one million as of 2007, the last year data was available. Employee testimony from EPZ factories includes complaints about low wages, excessive working hours, and poor living conditions. Numbers of wildcat strikes have occurred in EPZs. Vietnam’s labor laws fall short of several key internationally recognized labor standards. In particular, protections for the right to freedom of association, the right to collective bargaining, and the right to strike are inadequate. There hasn’t been any policy to protect union staff and most employers don’t cooperate with unions. The vast majority of strikes were considered illegal "wildcat" strikes. The number of such strikes markedly declined during the year, with only 309 occurring in the year. This followed a three year upsurge, which saw the number of wildcat strikes increase from 387 in 2006 to 762 in 2008. Most economists attributed the spike in the number of strikes in 2008 to dramatic increases in the cost of living, with inflation peaking at 28 percent in August 2008, and the relative decline in the number of strikes during the year to the return to single-digit inflation and worker concern with the slowing economy. More than 90 percent of "wildcat" strikes occurred in Ho Chi Minh City and surrounding provinces. While these strikes were illegal under the law, the government tolerated them and took no action against the strikers. The law prohibits retribution against strikers, and there were no reports of retribution. In some cases the government disciplined employers for the illegal practices that led to strikes, especially with foreign-owned companies. By law individuals participating in strikes declared illegal by a people's court and found to have caused damage to their employer are liable for damages. There has been a recent upsurge in migration of children under the age of 16 from central provinces or from the countryside to cities. They work 14 hours a day or more without contracts and benefits. Enforcement of labor law is weak; there are reports of thousands of children working in exploitative labor conditions. Generally, poverty appears to be the driving force behind the child labor problem. Vietnamese culture stresses educational achievement, so all but the poorest families generally send their children to school. Many reports cite impoverished families testifying that to survive they must contract-out their children. According to a July survey by the Ministry of Labor, Invalids, and Social Affairs (MOLISA) on working conditions in small- and medium-sized enterprises, up to 80 percent did not meet minimal work safety requirements, 8 percent had working conditions described as considerably poor, and 90 percent used obsolete machines and equipment. Employees typically worked in hazardous working environments--31 percent worked in very hot conditions, 24 percent in excessively noisy conditions, and 17 percent in places with high levels of dust.