While the world was focused on China, Vietnam quietly and meticulously became both an alluring place to travel and work, as well as a burgeoning economic player on the world scene.
In the United States and much of the West, Vietnam carries with it an unavoidable stigma related to an unpopular, protracted war and the symbolically important role the country played in the global rise and fall of communism. Vietnam’s portrayal in mainstream pop culture today is still more likely to focus on its problematic past than anything happening inside its borders today.
But while much of the world has been captivated (and distracted) by the rising fortunes of China, Vietnam has quietly and meticulously fostered its human and natural resources to become both an alluring place to travel and work, as well as a burgeoning economic player on the world scene.
This beautiful and diverse country offers significant opportunities to Americans and other Westerners looking to invest in Asia and, due to a litany of factors discussed below, is beginning to need education and exposure to foreign knowledge more than ever.
The golden population
The primary reason to be optimistic about the future of Vietnam is demographic in nature. Beginning in the last decade or so, the country reached a point where there were two working adults for every “dependent” child or senior citizen. Often described as its “golden population” structure, this trend should continue for several decades, as a third of the entire population of Vietnam is between 10 and 30 years old.
These numbers suggest a coming period of great socio-economic advancement, and the accompanying opportunity to rapidly develop the state of education, health and employment for the average Vietnamese citizen. They also signify an incredible move forward in the country’s ability to do business with Western companies, provided that the government’s appetite for investment in technology and labor force education remains strong.
As China’s costs get closer to parity with the rest of the economically developed world, and its population gets older, the PRC is starting to look inward. Knowing that it cannot sustain its economy forever on cheap manufacturing and exports, China will change its ways. The resulting effects on its trade partners around the world could be profound.
Many commentators, for example, have been talking for years about the “China Plus One” strategy pursued by American businesses. The thinking is that as prices in China rise, American companies can offset higher costs by diversifying their Asian operations not just in China but also among other countries in Southeast Asia, where prices are much lower. Vietnam is the poster child for this strategy, which has already begun to evolve from theory into reality.
Geopolitical advantages
Another huge strategic advantage held by Vietnam is the fact that the country is a member of ASEAN (in which China is not a part of) and will eventually be a member of the Trans-Pacific Partnership, whenever that becomes ratified. Foreign investment, not just from the U.S., but also from Japan, Taiwan, South Korea and other members of these trade pacts could help transform Vietnam into a manufacturing and commercial powerhouse.
Vietnam’s complicated relationship with China also has some important benefits to go along with its conflicts. For one, China is spending huge amounts of money to update and improve its links with other Asian countries. A current plan to build high-speed rail service throughout Southeast Asia and parts of Vietnam could have enormous economic benefits for the region as a whole.
Meanwhile, parts of East Asia experiencing labor shortages have looked to the young Vietnamese population as an excellent outsourcing hub, and Vietnamese guest workers have been imported to countries such as South Korea and Japan. Japan, in particular, has invested heavily in automotive manufacturing in Vietnam and often hosts large delegations of Vietnamese employees for training and educational programs.
According to Mai Hoang, Executive Director of the United States of America-China Chamber of Commerce (USCCC) in Chicago, Vietnamese workers are flocking to Japan to receive skills training with Japanese parent companies. “These same workers are incredibly interested in the possibility of traveling to the West and working with American companies, too,” says Hoang.
This trend gives Vietnam opportunities to develop key relationships with foreign multinationals while exposing the workforce to specialized manufacturing knowledge that was once all but inaccessible. The average Vietnamese will become more educated, affluent and a global consumer as a result.
Challenges aplenty
Of course, there are a number of challenges that Vietnam is facing and will continue to face for a long time to come. First and foremost among them is the need to improve education standards and maximize the inherent potential of the large youth population. Having a surplus of workers is not always a good thing if the skills of these workers cannot keep pace with the job requirements of a more technologically-oriented future.
Another issue is the huge disparity between boys and girls. With far more males than females in the youth demographic, problems related to gender inequality and a lack of sufficient potential marriage partners could crop up down the road.
Perhaps most pressing among the many concerns of a modernizing Vietnam is an undeveloped national infrastructure. Transportation, electricity and access to broadband will need to undergo substantial improvements for Vietnam to compete on a world stage, but the government understands this, and has already begun addressing the problem.
What does this mean for you?
This surge in manufacturing and foreign investment, as well as Vietnam’s unique demographic disposition, will create a huge demand for more education and access to the modern world. The Vietnamese need English language learning, advanced technical training for employees and business education to drill local managers in modern day business practices.
The education may come in the form of Vietnamese citizens traveling to the United States and other countries to attain Western university degrees or pursue corporate training programs. But it also comes in the form of private education companies developing courses that are taught in Vietnam. In fact, JMG’s strategic partner the USCCC is currently creating training courses for its client BECAMEX IDC Corp., which is the largest company in Vietnam.
Jennifer Nguyen, Study Abroad Manager, at AMA English Language Center in Ho Chi Minh City, has seen firsthand the uptick in demand for English language training by both young Vietnamese and adult business professionals. “Working with many American universities, we’ve been witnessing a tremendous increase over the past few years in the number of Vietnamese students applying to study abroad programs in the U.S.”
All of these trends implore us to take notice. The huge demand for education and training in Vietnam represents a beacon for American people to fly to Hanoi or Ho Chi Minh City and get to know the culture more intimately. In addition to the abundant professional and educational opportunities, Vietnam is a geographically rich nation of forests, mountains, rivers and pristine beaches. It is world-renowned for its food and friendly people who, despite the aforementioned conflicts of the past, are extremely Western-curious and open to learning English and building relationships with Americans.
For further reading on Vietnam’s “Golden Population,” check out “Ensuring quality education and health care for youth to realise demographic dividends” at Vietnam Breaking News.
Photo courtesy of Jonas on Flickr.