Vietnam As China Replacement

You know how when you buy a particular kind of car you all of a sudden see that particular brand of car everywhere? A similar thing has been happening to our law firm with respect to Vietnam. As soon as we brought on a really experienced Vietnam lawyer, we started seeing Vietnam opportunities just about everywhere:

• The high end shoe company client that was being threatened with a massive law suit in China by its China supplier for funds allegedly owed that supplier for shoes that our client literally could not sell? Start making the shoes in Vietnam.

• The clothing company that paid its long-time China supplier right before that supplier shut down and disappeared with all of the money? Transfer manufacturing to Vietnam?

• The American company whose China work force and China suppliers have combined to raise costs so much that it can no longer make a profit? A move to Vietnam is in order.

But what has recently really put the frosting on Vietnam’s cake has been the increased coziness between the U.S. and Vietnam governments. The New York Times did a story on this, entitled, In China’s Shadow, U.S. Courts Old Foe Vietnam, mostly focusing on the rapidly warming political relations between the two countries. But needless to say, with the warming political relations has come warming economic relations and what that means on the ground is that Vietnam is redoubling (if retripling were a word I would have used it) its efforts to bring in American businesses. I was in Vietnam during the riots against Chinese businesses and the word everywhere was that declining Vietnam-China relations meant that Vietnam would need to buff up its welcome mat for American companies and it has unrelentingly done so pretty much ever since.

Two days ago, in Foreign Executives in China. Worry Me Yes or Worry Me No? we wrote about how American executives that have acted within the law in China need not panic due to what is happening there with the onslaught of anti-corruption and anti-trust claims being brought against foreign companies. But that does not mean that American companies should not be looking at their China businesses holistically and making the tough decisions as to whether to stay or go or maybe just supplement.

For more on Vietnam as a China replacement, check out the following:

• New China. New Vietnam.
• China Plus One: How Vietnam’s Riots Help American Businesses 
• Where To Locate Your Business In China Or Asia
• Doing Business in China with an Asia Strategy
• The End Of Cheap China. The Next China Will Be The Post-China 16. Maybe.
• China Plus One. A Strategy (Or Just A Theory) For Every Size Business.
• China: Bad Meat, Cultural Differences And Anti-Corruption Compliance