Vietnam – New Destination for Software Outsourcing

Dang NguyenBusiness Development Manager

at TMA Solutions

Content

1. Vietnam overview2. Vietnam – New destination for software

outsourcing

• Size: 331,698 km2

• Main cities: Hanoi (Capital), Ho Chi Minh city (Business hub), Hue (Ancient Capital), Da Nang (Central hub), Can Tho (Mekong Delta hub)

• Population: 90+ millions – the 13th most populous country in the world• Workforce:

o Young and well-educated populationo 49M+ workmen (2012)o 60% of 90M population are under 30o 1,6M studentso Literacy rate is more than 90%

1. Vietnam Overview (1/3)

• Member of UN (United Nations, 1977), ASEAN (Association of Southeast Asian Nations, 1995), ASEM (The Asia-Europe Meeting, 1996), WTO (World Trade Organization, 2007)

• Politics/Legislationo One-party Communist stateo Safest investment environment: 41th on global peace in 2013 (Global Peace

index report)

1. Vietnam Overview (2/3)

• FDI: $40B+ invested in the last 10 years• GDP:

o $123.96 billion (2012), $141.67 billion (2013, estimate)o Average GDP growth of 7% during the last 20 yearso One of the fastest growing economies in Asia

• Inflation: 6.81% (2012)

1. Vietnam Overview (3/3)

• Vietnam

o The top destination for investment beyond BRIC (UKTI, 2010)

o Top 30 leading countries in the world, top 10 leading countries in Asia

Pacific in outsourcing and services (Gartner report, 2013)

o Top Ten of A.T. Kearney’s Global Services Location Index 2011 & 2009

o Be the most favored partner of Japanese business since 2009

• Ho Chi Minh City on KPMG 'locations to watch' for next outsourcing boom

(KPMG Advisory , 2009)

• Ho Chi Minh City: 16th among top 25 most attractive software outsourcing

countries. Hanoi ranked at 23rd (Tholons report, 2013)

2. Vietnam – New Destination for Software Outsourcing (1/5)

• ICT industry is young but developing fast

o 5,500+ IT companies in Ho Chi Minh City

o Software industry generated $1.17billion in 2011, increased 10% compared to

2010

2008 2009 2010 2011

680850

1,0641,172

Revenue of Software Industry (million USD)

Source: Viet Nam Information and Communication Technology – White Book 2012

2. Vietnam – New Destination for Software Outsourcing (2/5)

• Qualityo Meet stringent quality requirements from world leading companieso Adoption of international quality standards and methodologies for software

development and testing: CMMI, ISO, TL 9000, and Agile/SCRUM• Large pool of talents

o 400 universities and colleges with IT training programs (3-5 years) o 50K IT students graduate annually o IT human resource increased 55% from 200,000 in 2008 to almost 300,000 in

2011o Software workforce increased 38% from 57,000 employees in 2008 to reach

78,894 in 2011

Source: Viet Nam Information and Communication Technology – White Book 2012

2. Vietnam – New Destination for Software Outsourcing (3/5)

• Strong government support for the software industryo Intellectual Property Protection being improved. Software privacy reduced

9% from 2003 to 2011 (BSA)o Setting up software parks: Saigon Software Park, Quang Trung Software

City, Da Nang Software Park, etc.o Corporate income tax incentives for newly set up IT enterprises:

Tax rate at 10% in 15 years Tax exemption for no more than 4 years; 50% reduction of payable tax

amounts for no more than 9 subsequent years(Law on Corporate Income Tax, No 14/2008/QH12, Article 13, 14)

2. Vietnam – New Destination for Software Outsourcing (4/5)

Leading global companies that have outsourced to Vietnam

2. Vietnam – New Destination for Software Outsourcing (5/5)

Thank you!

For more information, please contact

Dang NguyenBusiness Development Manager at TMA Solutions

• Skype: anhdanglucky• LinkedIn: http://vn.linkedin.com/in/dangnguyenhcm