Vietnam trade strategy strong, flexible like the bamboo: VinaCapital exec

Vietnam’s trade strategy can be likened to the bamboo - deep roots, but flexible to sway with the wind, said Khanh Vu, deputy managing director of VinaCapital.

"We can inform investors that, thanks to free agreements, Vietnam has some of the best international connections," Vu told the Vietnam M&A Forum 2023 held Tuesday in Ho Chi Minh City.

"This is a powerful source of inspiration. Vietnam is extremely adaptable and capable of implementing the "bamboo strategy" in commerce. Vietnam, according to this notion, is persistent and highly resilient," he added.

Vu noted that investors were shifting cash flow to promising markets like Vietnam because they offer better returns. The Japanese and South Korean markets are no longer growing at their previous rates, he said.

Furthermore, Vu noted, Vietnam was the first market to have cut interest rates in the last six months, while other countries have increased theirs.

Another positive factor is the expected return of strong FDI inflows, he highlighted, noting that Vietnam's GDP growth rate was the highest in Asia, and it is projected that the rapid growth will persist in the coming years.

Warrick Cleine, chairman and CEO of KPMG in Vietnam and Cambodia, said there was a definite shift towards reducing dependence on China.

"Investors have faith in Vietnamese consumers. Regarding the story of capital mobilization, we are all watching what the Fed is doing with the dollars. If the dollar interest rate continues to rise, it will greatly affect valuations; the economy will continue to face difficulties; and if interest rates decrease, confidence in economic development will increase," Cleine said.

"The number of M&As has increased dramatically during the last 15 years. We believe that M&A will continue to grow and play a significant role in Vietnam in the next few years. Vietnam-US relations being upgraded to that of a comprehensive strategic partnership will be a factor in increased M&A transactions," he added.