American money makes huge profit in Vietnam

Vietnam has become an attractive place for American entrepreneurs to do business, as US investment into the country has flourished, translating into enormous profits.

Since the landmark Bilateral Trade Agreement between the two countries took effect in December 2001, a steady flow investment and goods from the US has continued.

Up to 80% of US companies operating in Vietnam say they are ?satisfied? or ?very satisfied?, according to a research by the American Chamber of Commerce, or AmCham.

Vietnam and the US re-established normal diplomatic relations in 1995. After 10 years, two-way trade soared to new highs.

In 1995, bilateral trade was only $450 million, but after 10 years, the figure leapt to $6.4 billion.

In 2005, Vietnam?s exports to the American market are expected to reach $5.7-5.9 billion.

In Vietnamese Prime Minister Phan Van Khai?s historic visit to the US in June, leaders of the two governments pledged to offer favorable conditions so that US investment into Vietnam would increase further.

Up to now, American firms have poured around US$1.34 billion into Vietnam, making the US the 11th largest investor here, say surveys by the Vietnamese Planning and Investment Ministry.

Doing business in Vietnam is getting easier and easier, Walter Blocker, AmCham vice president confirms.

Highest growth rate

Consumer goods giant Procter & Gamble is a good example of the success of American businesses in Vietnam.

After 10 years of operation in Vietnam, P&G has increased its investment by six times to expand production.

P&G investment into Vietnam is now $83 million, and the company raises capital continuously as its growth rate hits 30% each year, a company official said.

Among P&G subsidiaries around the world, P&G Vietnam has one of the highest growth rates, officials said.

In the last 10 years, P&G sales in Vietnam have topped $320 million.

Another instance is automaker Ford, which invested $102 million into Vietnam in 1995. After six years, its annual sales reached 1,223 vehicles, and the figure leapt to 5,618 in 2004.

Now Ford has become the second most successful foreign-invested auto manufacturer in Vietnam just after Toyota.

Spacious room for newcomers

On July 15, US hotel chain Hyatt will open its first hotel in Vietnam, the Park Hyatt Saigon, in Ho Chi Minh City.

A hotel giant like Hyatt only invests into strategic cities or places in the world, according to industry experts.

Experts say the establishment of $48 million Park Hyatt Saigon will attract more American visitors to Vietnam.

In late June, Vietnam saw the coming of an US insurance giant, which is ACE INA International Holdings, and in a very immediate future, New York Life would follow ACE?s step.

The coming of Hong Kong based health insurance giant Pacific International is also remarkable, the firm is mainly American invested.

Vietnam?s market is emerging into a new period, and there is still spacious room for newcomers, an ACE Life official said.