Vietnam

1. In what way does the political environment in Vietnam pose both an opportunity and a threat for American MNCs seeking to do business there?

Vietnam used to have a bad political environment for the United States to trade with due to the Vietnam War from the mid-1970s. However, Vietnam is now well on its way in establishing a vigorous trading relationship with the United States. In 1993, United States permitted the U.S. companies to take part in ventures in Vietnam that were financed by international aid agencies. Then a growing number of American firms began doing business in Vietnam. Vietnam is also the 150th member of the World Trade Organization. The entering of Vietnam shows the willingness of Vietnam government to open its trade market. The Vietnam government may have found that the economy of its neighbors in Southeast Asia, such as Thailand and Malaysia, has grown rapidly. However, the economy of Vietnam has been up and down, and it has lagged behind its neighbors. It might be the reason why Vietnam government started to warm up its relationship with the United States and enter the WTO. As the country has the willingness to build trade relationships with other countries, the United States MNCs will have opportunity to do business in Vietnam.

However, before Vietnam had entered the WTO, the trading market in Vietnam was not that easy for the U.S. MNCs. There are numerous and ever-changing bureaucratic rules enacted by the communist government officials. Things went better after Vietnam joined the WTO, but these concerns can never be solved because of the differentiation of the social formation. As a communist country, Vietnam government still closely controls the economy and can affect free trading market. The opportunity of the U.S. companies will be limited due to the interference of the Vietnam government.

2. Why are U.S. multinationals so interested in going into Vietnam? How much potential does the country offer? How might Vietnam compare to...