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The Vietnam News

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Vietnamese consultancies unprofessional

In the context of integration, the foreign capital flow to Vietnam is becoming stronger. Along with that, the need for good quality consultancies is on the rise. However, this potential market has been in the hands of foreign consultants for long.

An effective investment channel

In fact, the consultancy sector has been recognised as a service business as of late 2002. However, foreign consulting companies have been in Vietnam for over ten years, along with the coming wave of foreign investment. Many foreign investors haven entered Vietnam under the advice of consultants. Investment consulting is considered an effective investment promotion channel and also a lucrative market for consultancies.

With 35 years of experience working in the technology sector in Germany, assuming the Deputy Director of the German Biotechnology Association, returning to Vietnam in the role of a technology, product strategy and investment consulter, Nguyen Minh Dong, Director of the Germany - Vietnam Company has created a network of German consulters and investors. In this network, German consulters will ‘transfer’ German investors who want to know about the Vietnamese market to the Germany – Vietnam Company, which will provide consultancy service under the client’s need. In turn, Germany – Vietnam Company will ‘hand over’ Vietnamese clients who want to do business in Germany to its German consulters. Many German investors come to Vietnam by this way. A typical example is Germany’s leading pharmaceutical group – Schering. Knowing that this group planned to invest in Asian countries, Mr Dong convinced them to go to Vietnam. Another example is Mr Dong’s negotiating role in convincing Algatech Company to come to Vietnam to produce solar battery producing technology. Algatec plans to open a factory in Vietnam to manufacture the last component of solar battery system.

Albert Franceskinj, chief representative of France’s DS Avocats Law Company in Vietnam, reveals that DS has offered consulting services for many French investors, for example the Usinor Group, which has built a steel cutting factory in northern Hai Duong Province or an European helmet company to invest in helmet production in Vietnam in 1997-1998. Of course there are unsuccessful projects due to objective reasons. However the effectiveness of this investment promotion channel is clear.

Come to Vietnam with investment flow

According to Mr Albert Franceskinj, at the time when Vietnam first opened its door, the wave of foreign investment to Vietnam was very large. Many big international companies wanted to do business in the country. This is the reason for DS’s early presence in Vietnam (DS is the first foreign law company opening its office in Vietnam). Mr Albert confirmed that investment consultancy depends on the host country’s investment attraction situation. In recent years, SARS and avian influenza has affected Vietnam’s attraction of foreign investment resulting in bad results for investment consultancies.

The situation has become brighter in 2005. Chiristopher Runckel, Director of the US’ Runckel Associates consulting firm, said that the commercial exchanges between Vietnam and the US is increasing and more American companies want to do business in Vietnam. Runckel has conducting some business consultancy projects. Dr Tran Du Lich, Head of the HCM City Economics Institute, says Vietnamese consultancies operated daringly in the early of 1990s when the policy was still unclear but the flow of foreign investment was very strong. At that time, the first 5,000 print run of the foreign investment guide book for Vietnam, directly compiled by Dr Lich, sold out very quickly at US$10/book, a record high price for a small book like that.

Most consultancies would say that the consulting market in Vietnam has high potential, especially as the country is is about to join the World Trade Organisation (WTO). However, this potential playground has been conquered by foreign consulting companies thus far.

Nguoi Lao Dong - October 27, 2005.