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Vietnam's unification and economic growth has been slow and cautious. The transition from a centrally planned to a market-based economy has been in progress since 1986, but foreign investment has been slow due to the length of time the reform processes have taken. During the early-to-mid 1990s there was high economic growth and development, but the combined effects of the slow reform process and declining foreign and domestic investment resulting from the regional economic crisis of 1997 slowed growth in the late 1990s. As part of its efforts to improve the investment climate, the Vietnamese government is undertaking a privatisation program and is revising its investment laws. The economic emergence of Vietnam has been accelerated due to its oil exports and its global economic integration through bodies such as APEC, ASEAN and the World Trade Organisation (WTO).
Local professional accounting body
CPA Australia has a substantial membership in Vietnam which is expanding quickly, particularly at a student level. If you are a CPA Australia member and complete a transitional examination you will be recognised as a member of the Vietnam Association of Certified Public Accountants (VACPA). Vietnamese citizens and foreigners will be granted a Certificate of Auditors of Vietnam and recognised as a CPA in Vietnam if they:
- obtain CPA status by CPA Australia
- pass the transition examination held annually by the Ministry of Finance in Vietnam
- live or work in Vietnam for more than one year
Employment opportunities
Vietnam has a progressive national labour law, the Vietnam Labor Code, which is designed to regulate working conditions. Vietnamese and foreign employees are taxed differently, with personal income tax for Vietnamese starting at 10 per cent on monthly earnings after the first VND 4 million and rising to a rate of 40 per cent on earnings of more than VND 40 million. Foreign professionals earnings are taxed at between 10 per cent and 40 per cent, with the latter rate applying to monthly earnings of more than VND 80 million. Social insurance of 5 per cent of the total salary is deducted every month where the employment contract exceeds three months. A maximum of 3 per cent of employees in any company are allowed to be foreigners. The total number of foreigners in any one company is limited to 50 workers. This limits the possibilities for employment in Vietnam for foreigners.
Working conditions and lifestyle
Local customs and behaviours have a significant effect on business relationships in Vietnam. Establishing contacts first or having a known Vietnamese business contact will help with this process. While the Vietnamese government is making a concerted effort to bring about reforms, bureaucratic difficulties and delays and corruption are still significant concerns. Even if an interpreter is engaged, ensure you know whether they are from the north or the south, as the language varies.
Patience is a virtue in business negotiations. Don't expect to get a decision on a business proposition from a first meeting. It can help to send a detailed proposal in advance. However, telephone and internet services in Vietnam are very expensive and the latter is not widespread. A potential business contact will encourage you to do the calling or emailing from outside of Vietnam, but they may not respond.
Face-to-face appointments will not be given a long lead time and it is common practice for meetings to be confirmed only a week before the date. Don't display frustration or anger, as this is seen as personal weakness. And even though it may be prudent to engage a lawyer who has local knowledge, avoid taking them to business meetings for fear of appearing too legalistic.
Work permits
An employment visa is required for foreigners working in Vietnam.