Vietnam A Global Engine of Growth

Vietnam:
with contribution from

A Global Engine of Growth
Copyright © 2023 by Boston Consulting Group. All rights reserved.

Executive Summary
‘Vietnam: A Global Engine of Growth’ report provides a comprehensive analysis of Vietnam's investment landscape, aiming to provide
valuable insights for the international investment community on the growth journey and future prospects of Vietnam, one of the most fastest
growing economies in Southeast Asia, as well as its risks and challenges.
Over the past decades, Vietnam has emerged as an attractive hotspot with substantial capital inflows, attributed to robust economic growth,
strategic location, and abundant market potentials. Vietnam ranks 70th over 190 other countries in “Ease of Doing Business” research by World
Bank Group 2020, coupled with ongoing government’s effort on policy reforms, which paves the way for Vietnam’s pro-business environment
going forward.
This report presents some highlight on macroeconomic overview, business environments as well as investment opportunities in the
Vietnam: Tech-enabled sectors, modern B2B services and green-focused initiatives are among the most potential verticals for future growth.
However, to ensure success, it is imperative to conduct a comprehensive evaluation of the market entry strategy and the ability to thrive, taking
into account the various economic, legal, operational and environmental challenges that may arise.
Successful foreign investors largely possess 4 key factors:

• Strategic long-term investment strategy into government key areas, leveraging government incentives scheme
• Strong local partnership to leverage expertise and knowledge of local businesses, saving time and cost navigating local norms and
business practices
• Investment diversification across multiple asset classes/industries in order to minimize risks from monopoly industries and external
shocks as well as to maximize returns.
• Strong risk management and mitigation strategy in place to proactively manage risks associated with emerging market
Methodology. This report uses proprietary data from Golden Gate Ventures and public databases/reports to draw meaningful analysis.
1
Vietnam: At a Glance
Ha Noi
ECONOMIC INDICATORS
GDP Growth rate FDI Inflows Inflation rate

8.02% (2022) US$27.7b (2022) 3.15% (2022)
3.32% (2023Q1) US$ 3.35% (2023Q1)
GDP per Capita Benchmark Interest Rate Ease of doing business

US$3607.23 5.5% (May 2023) Global rank: 70/190 (2020)
(2022) Da Nang
SOCIAL INDICATORS
Population Government Literacy

Nearly 100m (Single-party) Communist 96% (2019)
Ho Chi Minh City
Global Index of Digital Global Innovation Index Internet Usage

Entrepreneurship Systems Global rank: 44/132 (2021) 74% of population (2021)
Global rank: 63/113 (2022)
2
Macroeconomic overview | Vietnam has been one of the fastest
growing economies within Southeast Asia
Vietnam has been outperforming its regional peers in terms of GDP growth rate and is In 2022, Vietnam achieved economic stability despite global turmoil with decent
expected to keep up with this momentum in the upcoming years economic growth and inflation being under control compared to regional peers
GDP Growth rate (%annual) - 2020 - 2024F GDP per capita ($US 2015 constant & CAGR from 2017-2022)
Vietnamese households focus on human development, proven by the highest % As a major agenda in the national development focus, urbanization has picked up
spending on education and healthcare than regional peers speed to support Vietnam’s ambitious growth trajectory
Spending as % of household income in 2022 Urbanization rate (% of total population), 2022 & Average urban population annual growth rate (2018-2022)
Average growth
(‘18-’22)
0.1% 2% 1.7% 2.1% 2.8% 1.6%
3
Source: Vietnam General Statistics Office, Philippine Statistics Authority, Singapore Department of Statistics, Vietnam Ministry of Planning and Investment, Passport Euromonitor, IMF, World Bank.
Macroeconomic overview | Vietnam has emerged as a hotspot for
FDI especially manufacturing, with APAC countries as major
contributors
Vietnam has emerged to be one of the most
Vietnam, Disbursed FDI (2015 - 5M2023) and 2023 forecast, billion USD
attractive destinations for FDI in the SEA
region
Set by rapid economic growth and

industrialization, Vietnam’s FDI disbursement
has been accelerating at a CAGR of 6.4% (2015-
2022). The Vietnamese government has taken
proactive steps to foster healthy investment
climate for FDI movements such as
administrative reform, legal and tax incentives.
● Top sectors for FDI disbursement:

Production,
Manufacturing & Real estate electricity, gas,
1 2 3
Processing activities stream & air
conditioning supply
● Top Countries by Total registered capital:
1 Singapore 2 South Korea 3 Japan
Covid-19 pandemic
(*) We expect Vietnam will maintain the current CAGR of 6.4% in FDI Disbursement in 2023 amid global economic downturns, amounting to $24B for FDI projects by year-end 2023. The shaded area is actual figure for 5M2023.
4
Source: Vietnam Ministry of Planning and Investment, Golden Gate Ventures
Macroeconomic overview | In the near term, Vietnam is expected to
maintain strong momentum and achieve highest growth forecast
ASEAN-6 Real GDP growth (%), 2020–2025F
Vietnam was the only one to log real As the global supply chain shift
Vietnam is on track to sustain its
economic growth in 2020, thanks to its quick continues to take place and
outperformer position in SEA if
success in curbing the pandemic, whilst other manufacturing being the key driver,
leveraging well its strong growth
economic recovery is further delayed by Vietnam's export is expected to
momentum
recurring and prolonged COVID waves exceed most others in the region
1
0
0
202 202 2022 2023 2024 2025
0 1 E F F F
- Indonesia Malaysia Philippines Singapore Thailand Vietnam

10
Source: Oxford Economics, OECD; BCG Research & Analysis 5

Macroeconomic overview | Significant change in trade expected in
next 10 years with ASEAN as the key winner
80
Change in trade of goods
-23 -10
(major corridors1,
-26 47
2031F vs. 2021, $B) 17
6
Canada UK
55 -38EU -262 90
338 Russia
China
>$1 Tn US -63
39 20
72
32
Japan/
Increase in 21 83 70 South Korea
trade for 7 93 GCC 27
438 2
ASEAN
2031 Mexico 172 India
236
35 21
42 59
137
73
ASEAN
Legend 136
Width of arrow represents total change in 74

trade flows for 2031 vs 2021 ($ billions) Mercosur
Africa
Color of arrow represents
<0% 0-2.3% > 2.3%
CAGR for 2021-2031 (%) Australia
Sources: Natural Earth Country boundaries without large lakes
1. Corridors in the map above represent ~46% of global trade 6
Source: BCG Trade Finance Model 2022, UN Comtrade, OECD, WEF, IHS, TradeAlert, BCG Analysis
Macroeconomic overview | Global manufacturers are increasingly
shifting production to Vietnam and SEA due to escalating geopolitics
between China and the West
Selective
New export US house of
US-China US-China
controls on Al & representatives
2-way tariff Phase I deal; Export controls AUKUS CHIPS act&
semiconductor votes to set up
escalation, US Penalties imposed expanded agreement to IRA policy passed
US & technologies; Latvia & committee to
export controls over China's further counter China challenged China;
Estonia exit China’s counter China; EU suit
on Huawei forced labor
EU “16+1” CEE coop. vs. China at WTO
actions
US-China China & Russia US-China
China China Adds US
postpone trade sign “no limits” balloon incident;
China increased sanctions 4 Defense
deal review; Partnership; China implores US to EU warns China
tariffs on US US govt. Companies to
China's China pushes China-EU drop tariffs on weapons
products commission Unreliable
US to cancel summit ends — supplying to
actions members Entity List
tariffs without results Russia
Jul- Jun’ Mar’ Jun’ Jun’ Aug’ Dec’ Feb’ Jun’ Aug’ Oct’ Nov’ Dec’ Jan’ Feb’ Mar’
Sep’18 19 20 20 21 21 21 22 22 22 22 22 22 23 23 23
Increases parts Plans to invest Invest more Partners with Expands Start its 2nd Moves Considers
supplies from an additional than US $1 Dai An Group its mnfg. mega plant in production of investment in
China to US$45 million billion factory for $1 B pharma site in Vietnam Vietnam MacBooks from Vietnam for
Vietnam in its subsidiary in Vietnam manufacturing China into chip packaging
Corporate in Vietnam plant Vietnam assembly plant
actions
Plans Invests $150 Intends to

Plans to build Considers
investment for million in invest $4 B in a
an automobile building plants
$300 mil. Vietnam for manufacturing
factory in in SEA instead
manu. plants factory base
Vietnam of China
building
Corporate actions Political actions
1. CAI: The EU-China Compressive Agreement on Investment; 2. Corporate action's date is the date of news article stating intention 7
Source: Reuters, VnExpress, BCG Global Advantage Geopolitics & Trade Impact Analysis
Macroeconomic overview | Vietnam will see a significant growth in
its middle class and affluent population in the next 10 years,
especially in emerging cities
2021 2030
Hà
25 cities with
Hà Cao Cao
Lai Lai Giang
Lào Giang Lào Bằng
14 cities with
Bằng Châu
Châu Cai Bắc Kạn Cai Bắc Kạn
Thái >200,000 Điện Biên
Thái
Điện Biên Tuyên LạngNguyên
>200,000 MACs Phủ
Tuyên LạngNguyên
MACs
Yên Quang Yên Quang Bắc Ninh
Phủ
Vĩnh Bắc Sơn Bắc Ninh Vĩnh Sơn
Bắc
Bái Bái
Yên Việt Trì Giang Yên Việt Trì Giang
Sơn Hạ Sơn New Hanoi Hạ
New Hanoi
La Long La Long
Hoà Hoà
Hưng Hải Hưng Bình Hải
Bình
Phủ Phủ
Yên Yên Hải Dương
Lý Hải Dương Lý
Thanh Hoá Nam
Hanoi, Bac Ninh, Hai
Thanh Hoá Nam Phòng Phòng
Định Thái Định Thái
Ninh Bình Ninh Bình
Hanoi & Hai

Bình Phong & Red River Bình
Delta
Vin Vin
Phong h
Hà
h
Hà
Capital & largest Tĩnh Benefit from more Tĩnh
seaport in Vietnam
Đồng
Hới industrial areas and FDI Đồng
Hới
companies setting up
Da Nang
Đông Hà Đông Hà
plants
Huế Huế
Focus on ICT, tourism,
Đà Đà
Nẵng Nẵng logistic sectors, and
Tam Kỳ
Tam Kỳ
Quảng Quảng attract more FDI ->
Kon
Ngãi
Kon
Ngãi
major share of MAC in
Tum Tum
Central Vietnam
Ho Chi Minh Pleik Qui
Nhơn
Pleik
u
Qui
Nhơn
u
Economic center of
Vietnam Buôn Ma Thuột Tuy Hòa Buôn Ma Thuột Tuy Hòa
Gia Gia
Nghĩa Nha Trang Nghĩa Nha Trang
Đồng Đà Lạt Đồng
Đà Lạt
Xoài Tây Ninh Xoài
Tây Ninh Thủ Dầu Một Phan Rang-Tháp Thủ Dầu Một Phan Rang-Tháp
Chàm Biên Chàm
TP.Hồ Chí
Biên
Phan Can Tho TP.Hồ Chí Minh Hòa
Ho Chi Minh &
Hòa Phan
Cao Minh Thiết Cao
Lãnh Long Vũng Center of Mekong Lãnh Long Vũng Thiết
Tân
An
Xuyên
Cần
Thơ
Tàu Mỹ Tho
Bến Tre Delta region for
Tân
An
Xuyên Cần
Thơ
Tàu
Bến Tre
Mỹ Tho Southeast region
Rạch
Rạch
Giá
Trà Vinh
economic activities Giá
Trà Vinh
Sóc Trăng
House more MACs -
Vị Sóc Trăng Vị Thanh
Vĩnh Thanh
Cà
Bạc
Liêu and MAC population
Vĩnh
Long
Bạc
Liêu
more industrial parks
Long
Mau Cà and logistic in Ba Ria –
Mau
Vung Tau
More than 1,000,000 MACs 500,000–1,000,000 MACs 200,000–500,000 MACs Less than 200,000 MACs
Notes: MACs – Middle and affluent classes

8
Source: BCG Vietnam wealth and population model, BCG geoanalytics
Business environment | Recent regulatory
reforms have created a more conducive
environment for businesses in Vietnam
70th Rankings of Vietnam in Ease of Doing

Business (2020) released by World Bank
Group, measuring regulatory
performance relative to other countries
Global rank
Vietnam, Rankings on individual topics
Dealing with construction 25 Protecting minority investors 97

permits
Trading across borders 104
Getting credit 25
Getting electricity Paying taxes 109

27
Registering property 64 Starting a business 115
Enforcing contracts 68 Resolving insolvency 122
Vietnam has been working on regulatory reforms and technology infrastructure to

ease the process of getting construction permits, credit, and electricity for
entrepreneurs. However, improvements are still in need in cross-border trading, tax
payment process, and insolvency treatment, posing foreseeable challenges for
prospective investors and founders.
**Economies are ranked on their ease of doing business, from 1–190. A high ease of doing business ranking means the regulatory environment is more conducive to the 9
starting and operation of a local firm.
Source: World Bank: Ease of Doing business 2020
Business environment | The strategic location and openness to the global
economy through various trade agreements provide geopolitical advantages
Vietnam acts as an indispensable link into the global supply chain Being an export-driven economy, Vietnam has also established
with long coastline of 3,260 km stretches across the country diplomatic connections with numerous markets and global powers
Mainland
China VIETNAM
Top 50 Kyrgyzstan Kazakhstan Armenia Belarus
RCEP ASEAN4
3 seaports of Vietnam named Cambodia Philippines Indonesia Thailand Russia
Thailand in the World’s largest cargo
VCFTA
Philippines
throughput (2020) (1) South Korea Laos VIETNAM
Singapore Brunei Malaysia Chile Mexico
VKFTA
Myanmar
Japan New Zealand Australia Peru Canada
Malaysia
14th CPTPP
Vietnam’s rank on Liner Myanmar
Mainland China Hong Kong
In negotiation
Singapore
Shipping Connectivity Index EU
Indonesia (2022Q4) (2) EVFTA UAE Canada Israel
Currently, Vietnam has created diplomacy with 178 nations and has developed
economic, trade, and investment relationships with 224 countries and territories.
Vietnam’s sea area locates in the important maritime routes and the air lines between ● Vietnam holds memberships in various international organizations
the Indian Ocean and the Pacific Ocean, between Europe, the Middle East and
Mainland China, Japan and other regional countries.
33 airports 320 seaports & river ports * Non-exhaustive
(11 international airports) (163 international ports) ● Vietnam has 15 active (signed) Free Trade Agreements (FTAs) and other 4
under negotiation.
Notes: The RHS diagram is for visualization purposes only, this is non-exhaustive list of Vietnam’s FTAs. Full list of Vietnam’s FTAs is in Appendix - Vietnam FTAs.
(1) According to Lloyd’s list of 100 Ports 2020 at Lloyd's List, the latest update by Lloyd Maritime Company (UK)): Sai Gon port (ranking 22nd), Hai Phong port (ranking 28th) Cai Mep port (ranking 32nd).
(2) Vietnam had an index of 76.37 in 2022Q4 by UNCTAD. The index can be considered a proxy for accessibility to global trade through the shipping network. The higher the index, the easier it is to access a high capacity and frequency global maritime freight transport system and
effectively participate in international trade.
(3) EFTA including Norway, Switzerland, Iceland, Liechtenstein)
(4) ASEAN has multilateral trade agreements with India, Mainland China, New Zealand, Australia, Japan, South Korea, Hong Kong.
10
Source: EY, SEA map attributed to VectorFlag.com, Lloyd’s List Intelligence, Open Development Vietnam, Website of WTO Center under Vietnam Chamber of Commerce and Industry at https://www.trungtamwto.vn/, Vietnam General Consulate Houston, visualization adapted from Asia
Briefing.
Business environment | Vietnam also offers powerful competitive
advantages in workforce, living environment and corporate tax treatments
Competitive labour cost Hospitable living environment for expatriates
Minimum monthly wages of Vietnam vs Countries, 2022, $ Expat City ranking, 2021
473
380
310
231
6th 1st 5th 11th 13th
200
HCMC Kuala Singapore Bangkok Shanghai

Lumpur
Vietnam China Indonesia Philippines Malaysia
Formidable industry workforce size Favourable tax rate
Workforce in manufacturing sector, 2022, million people and Corporate income tax across major APAC countries, 2022
percentage of total population
14% 10% 8% 4% 9% 30%
13 25% 25% 24%
6 20%
1 2 k
4 1
4 3
Vietnam China Indonesia Philippines Malaysia Vietnam China Indonesia Philippines Malaysia
Note: Expat City ranking is annual report from InterNation where expats are asked to share personal experiences from the quality of life to working abroad
11
Source: Oxford Economics, InterNation, BCG analysis
Business environment | Investment incentives are also provided to support
economic breakthroughs in many key industries in Vietnam
Industry-based tax incentives in Vietnam
Summary of Prioritized Business Lines and Projects Eligible for Investment Incentives In Vietnam
Class High tech Large scale Social importance
Description: Investment projects in the following sector Manufacturing projects with a Investment projects in the
categories: minimum invested capital of VND following sector categories:
➢ Information technology 6,000 billion, and which meet one of ➢ Education
➢ Biotechnology the following ➢ Vocational training
➢ New Material technology ➢ Annual revenues of VND 10,000 ➢ Healthcare
➢ Automation technology billion by the fourth year of ➢ Culture
➢ Supporting products for high operations ➢ Sports
technology ➢ Employment of at least 3,000 ➢ Environmental
➢ Scientific research and development workers
➢ Software production
Manufacturing projects** with a
minimum investment capital of VND
12,000 billion and which utilize certain
technologies.
Incentives: 10 percent CIT for 15 years* 10 percent CIT for 15 years* 10 percent for entire life of project
CIT exemption for 4 years** CIT exemption for 4 years** 4 years of CIT exemption**
50 percent reduction on payable CIT for 9 50 percent reduction on payable CIT 5 years of 50 percent reduction
years for 9 years on payable CIT
* From the first year of operating income generation
**from the first year of profit 12
Note: Projects invested into within economic zones may be liable to different treatment.
Source: Vietnam Briefing
Investment opportunities | Government direction to double down on
3 key growth pillars to restructure the engine of economic growth …
From “High speed”... To “High quality”...

By restructuring the engine of economic growth…
National Master plan for
2021-2030 with vision to 2050
Labor intensive Talent focus
Static forces (e.g. low-cost Dynamic forces

Digital Green Hi-tech labor, natural resources) (e.g. innovation)
Economy Economy economy
Modern technical & social infrastructure

Emerging economy Regional top-tier
High productivity, advances in science, economy
technology & innovation And moving to more sustainable development model
Developing people's material, cultural &
spiritual value
Forming and developing economic corridors

Depleting/Polluting Green ambition
Source: Resolution No. 81/2023/QH15, Decision No. 569/QD-TTg, BCG analysis 13

Investment opportunities | … and shift focus to “higher quality” FDI
Vietnam’s shifting of FDI strategy from Key selecting factors for FDI
“attracting at all costs” to “selectively attracting”
High quality
High quality
Focus on project that blended into the • Prioritizing value added investment to the people
such as Education, R&D, Supply chain linkages, etc.
development plan of the country
• Prioritizing businesses that operate effectively (high
safety standard, fully integrated) & fulfill their
commitments (e.g. providing jobs, paying tax, etc.)
Technology efficiency
• Encouraging advanced/new/high/clean
technology and modern management projects
• Encouraging technology transfer and governance
for Vietnamese companies
Environmental impact
• Improving standards and technical regulations on
products, environmental protection, resources and
energy saving in line with regional and world
standards
Technology efficiency Sustainability • E.g. New projects manufacturing reproduction
More technology, innovation, More sustainable and energy, clean energy, energy from waste
less labour intensive investment eco-friendly investments
Source: Resolution No. 50/2019/NQ/TW on “Perfecting the policies of FDI cooperation by 2030”; BCG analysis 14
Investment opportunities | Future potential growth sectors worth
investigating for foreign investors Non-exhaustive
1 2 3
TECH-ENABLED MODERN B2B GREEN ECONOMY
SECTORS SERVICES
HealthTech Asset-light Logistics Renewables
FinTech IT & DIgital services De-carbonisation services
EdTech Recycling & circular economy
Deep-dives in next pages

15
Tech-enabled sector: HEALTHTECH
An untapped sector with numerous unresolved pain
points, HealthTech is emerging to be beyond
6% $161 promising
Healthcare spending
per capita in
Vietnam (2018) Attributed to the following drivers:
Growing tech-savvy population with high propensity to spend on

x3
●
Healthcare healthcare driven by expanding consuming class and rising health
spending as %
$408
awareness.
Vietnam per Healthcare spending
per capita in Overloaded public hospitals, lack of public infrastructure
capita income Vietnam (2028)
●
investment and undersupplied healthcare professionals have
(2022) created a solid ground for innovative forms of healthcare such as
remote monitoring solutions, telemedicine, AI-diagnosis and
NOTABLE STARTUPS empowered the private healthcare sector to grow.
Booking/ Digital
Telemedicine/O2O Marketplace Biotechnology
Pharmacies ● Unpleasant experience, long wait, outdated infrastructure remain
patients’ pain points during offline health check-up at public
hospital, giving a rise for private sector and patient-focus startup
solutions.
● Government support and preferential tax treatment to encourage

the development of healthcare sector and make room for
innovation.
16
*The list is non-exhaustive and not ordinal.
Source: Insignia Ventures Partners, InnolabAsia, Tracxn Technologies
Tech-enabled sector: FINTECH
Vietnam, Total funding value & Count of fintech deals, 2016 - 9M2022 Fintech is making a boom in Vietnam, the sector has
(in million USD) received substantial funding while presenting huge
room for growth
Attributed to the following drivers:
● Young, tech-savvy population of nearly 100 million people with

increasing digital adoption and smartphone ownership.
● A significant proportion of the unbanked population remains

Deals count (*) 2 2 5 7 2 5 14 13 30 27 untapped; MSMEs (representing 70% of Vietnam’s GDP) are
struggling with financing.
Vietnam, Transaction value of the fintech sector, 2017 - 2027F, by ● Rising middle-class and buoyant economic activities further
segment (in billion USD) fortify demand for fast, cost-effective and innovative financial
services digitalization.
● Favourable government policies and initiatives to promote digital

payments, financial inclusion and innovation.
NOTABLE STARTUPS
Payment Consumer finance Data Blockchain
Intelligence
(*) Golden Gate Ventures preliminary count, non-exhaustive. Fintech sector includes but is not limited to core payment services, technological applications into financial services and banking. 17
Source: World Bank, Statista, Do Ventures; Tracxn Technologies
Tech-enabled sector: EDTECH
Vietnam, Total funding value & Count of Edtech deals, EdTech is gaining attention from purpose-driven
2013 - 2021 (in million USD) investors
Attributed to the following drivers:
● Large and growing young population with a strong demand in

high-quality education and professional development with high
level of digital adoption into learning, teaching and educational
experiences.
● Higher spending propensity on education due to deep-rooted

belief in the importance of having educational advantages,
coupled with rising disposable income and buoyant economic
growth.
● COVID-19 has set a new learning and teaching normals that can
Deals count (*) - - - 3+ 5+ 3+ 3+ 2+ 6+ 11+
be facilitated through online platforms.
NOTABLE STARTUPS
● Supporting government initiatives to promote the development
of education and edtech industry.
Digital transformation of education in Vietnam is still in its early stages. In

2019, Vietnam was among the top 10 fastest-growing online education
markets worldwide, with an annual growth rate of 44.3%. Currently, there are
over 200 EdTech firms in Vietnam, serving 2 million users nationwide, with a
market size estimated at no less than $2 billion.
18
(*) Golden Gate Ventures preliminary count, non-exhaustive, not ordinal.
Source: Golden Gate Ventures, Crunchbase, Do Ventures, Cento Ventures, EdtechAgency.
Modern B2B services: ASSET-LIGHT LOGISTIC
Asset-light models are making a huge boom in business
How the landscape has been transformed
and investment landscape
The supply chain and logistics sectors have undergone significant Traditional Innovative
changes in recent years. Traditionally seen as heavy-asset business Notable startups
industry moves
models due to huge capital expenditure and large asset base, the
emergence of innovative players and shifting global supply chain
dynamics have allowed companies to leverage third-party services and Courier, express, Last-mile delivery
adopt asset-light models. and parcel
With Supply-Chain-as-a-Service, organizations can focus on their core

competencies while utilizing partners' key assets to adapt quickly to
changing customer demands. This approach enhances operational Fulfillment service
efficiency and enables businesses to tailor their services more effectively,
leading to improved outcomes and increased agility in the face of
evolving market conditions. Transportation Trucking flatforms
& Storage
Building blocks for Asset-light models:

SUPPLY CHAIN AS A SERVICE
Warehousing
Supply chain planning as a Supply chain management as a
service service
Supply chain solutions Inventory/warehouse/
Logistics as a service Manufacturing as a service order management
Route ops
Commercial optimization as a
Inventory as a service
service
19
** The list is not exhaustive and ordinal.
Source: Golden Gate Ventures analysis, Crunchbase, KPMG, Accenture
Green economy: RENEWABLES
Green investments has been fueled by the new
>80%
wave of ever-growing green opportunities driven by
has been deployed in strong commitment to Net Zero target
Solar/Wind/Other In 2021, Vietnam’s Prime Minister Pham Minh Chinh announced
of corporate renewables project in SEA Vietnam's commitment to achieving its net-zero emissions target
(cumulative, 2020-2M2022) by 2050 at the UN Climate Change Conference in Glasgow (COP26).
green capital
Renewables see great potential due to strong onshore & offshore
technical wind/solar capacity, also attributed by the following drivers:
RECENT DEVELOPMENT
● Governmental supports to allow foreign investment in
industries that were previously restricted, and revisions to
laws that include foreign bidders in publicly-funded
projects.
plans building 3.9- intends to
GW offshore wind develop $13-billion ● Rising investment in infrastructure through public-private
farm in Vietnam wind farm in aim to develop 1.5 partnerships (PPPs), promoting innovation and
Vietnam GW of renewables digitalization to support its net-zero transition.
in Vietnam
Opportunities for capital investment (*):
NOTABLE STARTUPS ON SOLAR
● Early-stage capital: Onshore/Offshore wind project &
Small-scaled solar panel projects with high risk - high
return potentials amid unclear feed-in tariff policies.
● Mature capital: Mature/operational onshore wind projects

Solano Energy with less risk thanks to projects that are already in
operations by established developers.
(*) According to Bain and Temasek, with contributions from Microsoft, Southeast Asia’s Green Economy 2022 Report: Investing behind new realities. 20
Source: Temasek, Bain & Company with contributions from Microsoft, Chambers and Partners, asiaperspective.com, Press releases.
Risks & Challenges | Investors needs to carefully manage the risks to
ensure successful investment - Political & economic risks
1 A relatively open economy 2 Territorial disputes
• Vietnam’s economic openness ranks 5th out of 35 Asian markets: score 74.6 /100 - higher • Political risk in Vietnam is moderate. The political and security environment has a track
than Asia’s average of 46 and global average of 49.5, according to a report by Fitch Solutions. record of stability, helping to provide a conducive environment for doing business. The
government remains committed to stamping out corruption and implementing policies to attract
• Vietnam is one of the most open economies to international trade in Asia: Vietnamese trade investment.
represented 186% of GDP in 2021 (World Bank, 2023).
• Territorial disputes remain an ongoing risk to Vietnamese relations with neighbouring
• Nevertheless, Vietnam’s excessive reliance on exports and FDI has been seen as a potential
countries, as Vietnam is dependent on imports.
problem for the country. While foreign invested companies accounted for only 20.3% of
Vietnam’s GDP, they contributed a whopping 67.8% to Vietnam’s total export turnover in 2019.
⇨ High foreign dependancy can make Vietnam vulnerable to global economic changes and
changes from major foreign-invested enterprises on which the Vietnamese economy is over-reliant. Trade structure by destination/origin
(% of total, 2021)
One oft-cited example of Vietnam’s over-dependence on foreign capital and exports is Samsung. It
was Vietnam’s largest foreign investor, with an accumulative investment of more than US$17 billion as Exports Rank Imports
of March 2020. In 2019, Samsung Vietnam’s revenue of USD68.3 billion was about 26% of Vietnam’s
GDP and had an outsized contribution of 19.4% to Vietnam’s export turnover. A single foreign- United States 29.1% 1 Mainland China 33.8%
invested company contributing ~20% to export turnover is unprecedented in Vietnam and rarely seen
anywhere in the world. Should Samsung decide to wind up or scale back its operations in Vietnam, Mainland China 17.0% 2 Korea, Republic of 17.3%
Vietnam’s economy will suffer enormously.
Korea, Republic of 6.6% 3 Japan 6.9%
Photo courtesy of Fitch Solutions Japan 6.1% 4 Taiwan 6.4%
Hong Kong 3.6% 5 United States 4.6%
Economic openness scores of East and Southeast Asian markets
Note: Fitch’s economic openness is generated from 2 main indicators: trade and investment
openness, which are based on import, export and FDI values as a percentage of GDP. It scores each
market on a scale of 0-100, with 100 being the highest.
Source: Fitch Solutions, VIR, Vietnam Chamber of Commerce and Industry, ISEAS – Yusof Ishak Institute. Source: Allianz Research, La Coface, Export Finance Australia
21
ensure successful investment - Legal & regulatory risks
1 Legal risk analysis 2 Some industries are heavily regulated
• Vietnam’s scores on Worldwide Governance Indicators are broadly in line with or Vietnam's productivity and competitiveness remain hindered by high levels of
stronger than the average for emerging Asian countries. The notable exception is government intervention in the economy through regulation and the dominance of
voice and accountability. state-owned enterprises (SOEs).
• Low risk of expropriation: consistent with Vietnam’s governance scores around the • SOEs have played a dominant role in several important industries, namely oil and
control of corruption and rule of law. The government can only expropriate investors’ gas, electricity, banking, telecommunications, transport infrastructure and
property in cases of emergency, disaster, defence, or national interest. The production of some basic input materials for the economy. Up to 96% of customers
government is required to compensate investors if it expropriates property. use mobile phone networks of SOEs, including Viettel, VNPT, and Mobifone. State-
owned commercial banks such as BIDV, Vietcombank, Vietinbank... accounted for
more than 50% of the total loan balance of the whole banking sector.
⇨ Investors may not prefer startups operating in heavily government-regulated industries

due to the implied risk of competitiveness and regulatory barriers.
E.g. In March 2023, 36 clean electricity investors signed a document to petition the Prime
Minister about the inadequacies in the electricity generation pricing mechanism with
wind and solar power, making their power plants cannot sell electricity to EVN - monopoly
national power system, putting investors at risks of financial plan failure and increasing
bad debts.
• However, Vietnam’s divestment and equitisation plans have opened several opportunities for
investors, incentivizing FDI in SOEs. For instance:
Source: Export Finance Australia Source: VIR, Vietnamnet, nhandan.vn, Ministry of Finance
22
Risks & Challenges | Investors need to carefully manage the risks to
ensure successful investment - Operational Challenges
1 Supply chain challenges 2 Lack of local expertise
Management votes “Lack of alignment between supply chain operating Foreign investors generally face difficulties to navigate local
model and business direction” and “Lack of real-time visibility of cost, practices and understand the intricacies of the market
service level, inventory, etc. on the organizations’ end-to-end supply chain”
as top concerns within supply chain management. • Lack of availability of specialized personnel, skills and
(KPMG 2021, “Vietnam Supply Chain at a Glance”) knowledge: Foreign investors often rely on local experts or
• Shortcomings in production standards: Majority of industry advisors to get industry insights, sector-specific
manufacturing facilities in Vietnam are inadequately equipped frameworks, and market dynamics.
to reach international standards regarding quality, health, and
safety that pose challenges to international new entrants. • Language and communication barriers: Different languages
used by investors and local stakeholders may hinder effective
• Physical logistics Infrastructure in need of improvement: collaboration and potentially incur miscommunication during
Transportation infrastructure in Vietnam still presents investment and operations processes.
limitation in terms of quality, connectivity of modes of
transport, management, technology application that yet to
meet the demand of delivering goods from factories to ports or 3 IT challenges
distribution centers such as long lead time, transshipment
problems, etc. Foreign investors should be aware of IT infrastructure and
communication capabilities of Vietnam:
• High logistics costs: The latest report of the Việt Nam Logistics
Association revealed that logistics costs were equivalent to • Quality of internet access is not high-speed and uniform
around 20-22% of the country’s GDP, much higher than across the country: Median download speed is 38.23 Mbps via
Thailand (19%), China (18%), Malaysia (13%) and nearly x3 higher cellular mobile connection & is 76.16 Mbp via fixed broadband.
than the US and Singapore (8%), leading to profitability
headache to businesses.
(*) Speedtest Global Index ranks Vietnam 47 out of 140 countries and 45 out of 182 countries in terms of the median download speed via cellular mobile connection and via fixed broadband
internet.
Source: KPMG, Savills, Open Development Vietnam 23
ensure successful investment - Environmental challenges
1 Pollution 2 Lack of regulatory comprehension for
green initiatives
• Air pollution has yet to met WHO guidelines: The primary Amid renewables mania, Vietnam’s government are yet to prepare
causes of air pollution in Vietnam is the use of fossil fuels for a complete regulatory package for a smooth transition.
power generations, exhaust transportation vehicles and factory
emissions. Along with industrial growth, Vietnam is expected to • There is not yet clear guidelines for rooftop solar panel
continue experiencing low air quality problems, especially near power generation: Currently, majority of customers of solar
industrial zones. energy are households and small-scale buildings. Vietnam’s
governmental agencies are in the process of developing
• Water pollution remains major concern: A significant portion policies for solar energy installation, usage, sales, and waste
of Vietnam's wastewater is discharged without undergoing management. This may cause a delay in solar energy
treatment, only 12.5% of municipal wastewater get treated. development and uncertainty for foreign investors.
Treatment of wastewater is often neglected, resulting in the
untreated discharge of wastewater from craft villages, factories • Monopoly of EVN may hinder the development of
outside industrial zones, and local healthcare facilities into renewables projects: Up to now, EVN (Electricity of Vietnam)
rivers, lakes, and oceans. enjoys exclusive control over Vietnam’s power transmission and
distribution sector, creating high barriers to enter the market.
EVN is now in charge of buying electricity from power
Urban households' connection to drainage systems is limited to 46%, only ⅔ generation companies and distributing to end-consumers,
Industrial wastewater from industrial zones is treated, but centralized which diminishes bargaining power of independent renewable
wastewater treatment facilities are available in only 9.4% of industrial clusters. energy producers.
(World Bank Group 2019, “Vietnam: Toward a Safe, Clean, and
Resilient Water System”)
Source: Press releases, World Bank 24

Potential exit options in Vietnam
Although exit strategies for PE/VC investors in Vietnam remain relatively complex and their efficacy at scale
has not yet to be fully demonstrated, there are still some viable options
1
● Onshore listings can be a viable (but not easy) option for private equity portfolio companies due to the thin liquidity
of the country’s key stock exchange, the Ho Chi Minh City Stock Exchange, and strict listing requirements, including
the requirement that any issuer have a return on equity of at least 5% in the year preceding the year of the listing
application and profitability for the 2 consecutive years prior to the year in which the listing application is made.
Domestic IPO ● Given the limitations of the domestic IPO market, in recent years, a number of Vietnamese companies, including
portfolio companies of private equity firms, have been exploring offshore IPOs. However, due to a combination of
poor market conditions and a number of legal and technical hurdles, none of these companies have been able to
complete an offshore IPO to date, though it is likely to be only a matter of time before one is successful. A
Vietnamese company looking at consummating an offshore IPO will require complex restructuring in order for the
offshore listing to be workable.
2
Trade sale
to strategic ● In the context of a trade sale or secondary exit, most private equity sellers will agree to make fundamental
investor warranties only.
3
● Holdbacks and escrow mechanisms are sometimes used but are rare in Vietnam.
Secondary buyout ● Warranty and indemnity has been used more frequency recently in M&A transactions as foreign buyers seek to
by another PE firm manage risks and streamline deals
4
Management ● Management buyouts and/or redemptions are relatively rare and will often come into play on deals that have
buyout or not gone well for whatever reason.
redemption
25
Source: Freshfields Bruckhaus Deringer
Contributors
Tram Nguyen
Vinnie Lauria
Associate, Golden Gate Ventures
Founding Partner, Golden Gate Ventures
Tram is an investment professional with 7 years of
Vinnie is an entrepreneur turned venture capitalist.
experience spanning early-stage technology ventures
He’s been investing in Asia for over a decade and has
to cross-border mergers & acquisitions. Tram brings a
made 60+ investments to date. He is a Kauffman
unique blend of local knowledge and international
Fellow and Tsinghua EMBA candidate. Vinnie joined
exposure. She holds an MSc in Finance and
his first startup while still in high school.
Management from the University of Exeter.
Uyen Nguyen Quyen Dang

Intern, Golden Gate Ventures Intern, Golden Gate Ventures
Uyen is a fresh graduate with Economics & Finance Quyen is a fresh graduate from RMIT University
major from RMIT University. Uyen has intense Vietnam majoring in Economics and Finance. With
passion about investment career and is excited to strong passion in strategy and finance, she has been
participate in different investment projects in either exploring different angles of deal continuum in
Vietnam or SEA markets. various investment projects in multiple industries
focusing on Vietnam’s market.
26
Contributors
Il-Dong Kwon Hanno Stegmann
Managing Director and Partner, Head of BCG Managing Director and Partner, Head of BCG X SEA
Vietnam
Hanno is dedicated to inventing, building, investing in,
Il-Dong has been with the Vietnam office for 7 years and launching category-changing businesses at
working with industry leaders and central and startup speed together with the world’s most
provincial governments on their strategy and large- influential corporates. Over the last several years,
scale transformation programs. He also co-leads Hanno launched more than ten new businesses in
BCG’s work in risk management for the Asia Pacific various industrial goods and consumer products
region. companies that have created billion-dollar impact.
Arnaud Ginolin
Partner BCG Vietnam
Arnaud has more than 15 years of consulting

experience in designing and executing strategic
programs for clients in industrial goods, energy and
public sector. Most recently, he has helped
governments develop programs to accelerate their
transformation efforts focusing on smart technology
and sustainability.
27
About Golden Gate Ventures
● Golden Gate Ventures, with HQ in Singapore and offices in Indonesia and Vietnam, is a Southeast
Asian venture capital firm founded in 2011 that brings together knowledge and experience from
Silicon Valley with passion and ambition for Southeast Asia.
● For over a decade, we've proudly backed some of the region's most audacious founders and had the
privilege of being part of the region’s incredible growth story: launched 4 funds, have US$250M AUM,
and invested in 80+ companies with 9 unicorns across our portfolio.
● We’re deeply committed to continue to play a supporting role - spot trends, deliver data-driven
insights, facilitate lasting global connections - and always show up for those brave enough to
catalyze change.
About GGVbrain
● Internal proprietary tool that helps us analyse trends, predict new sectors, and signal sentiment and
investibility that guides our deal sourcing, deal screening and research processes.
28
About Boston Consulting Group
Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their
greatest opportunities. BCG was the pioneer in business strategy when it was founded in 1963. Today, we work closely with clients
to embrace a transformational approach aimed at benefiting all stakeholders—empowering organizations to grow, build
sustainable competitive advantage, and drive positive societal impact.
Our diverse, global teams bring deep industry and functional expertise and a range of perspectives that question the status quo
and spark change. BCG delivers solutions through leading-edge management consulting, technology and design, and corporate
and digital ventures. We work in a uniquely collaborative model across the firm and throughout all levels of the client organization,
fueled by the goal of helping our clients thrive and enabling them to make the world a better place
About BCG X
BCG X is the pioneering new tech build and design division of Boston Consulting Group. It is uniquely positioned to support
companies in Southeast Asia seeking to kickstart the journey to new markets through venture opportunities. BCG X brings
together advanced tech knowledge and ambitious entrepreneurship experience to turbocharge BCG’s trusted corporate offering.
The division is positioned to help organizations embrace, enable, and succeed in delivering innovation at scale, backed by over
3,000 technologists, data scientists, programmers, engineers, and human-centered designers located in more than 80 cities across
the globe 29
Legal Disclaimer
Disclaimer
This communication has been prepared by Golden Gate Venture’s Research Team (“GGV”) for general information only and is not intended to be relied upon
in any way. Golden Gate Ventures is an early stage venture capital firm based in Singapore. We are an independent company incorporated in Singapore and
are not affiliated to any other company outside of Singapore and the Cayman Islands. In particular Golden Gate Ventures is not associated in any way with
GGV Capital based in Silicon Valley, United States of America and Shanghai, China or Golden Gate Capital based in San Francisco, United States of America.
Our business takes us to various parts of the world, and there may be companies in those countries with a similar corporate name, but we are not in any way
related to them.
Information, projections and images

Information contained in this communication has been obtained from materials and sources believed to be reliable at the date of publication, however GGV
has not taken steps to verify or certify its accuracy or completeness. Opinions, projections and forecasts in this communication depend on the accuracy of
any information and assumptions on which they are based, and on prevailing market conditions, for which GGV does not accept responsibility. No
representations or warranties of any nature are given, intended or implied by GGV about this communication, any information, opinions and forecasts
contained within this communication or the accuracy or enforceability of any material referred to in this communication.
GGV (including its employees, officers and agents) any of the employees of GGV referenced in the communication will not be liable, including in negligence,
for any direct, indirect, special, incidental or consequential losses or damages arising out of or in any way connected with use of or reliance on anything in
this communication. For the avoidance of doubt, GGV (including its employees, officers and agents) will not be liable for any investment decision based in
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recipients of this communication to exercise caution and to conduct their own due diligence on the relevance, accuracy, completeness and currency of the
information in this communication.
30
Appendix –
Business Environment
Vietnam's strategic location, stable political environment, and
openness to the global economy through various trade
Key business agreements provide it with geopolitical advantages
environment Vietnam's workforce is also advantageous, with competitive
factors labor costs and a formidable size
contributing To further encourage investment, numerous legal requirements

were amended to make investing in Vietnam more transparent
to and promising
investment Investment incentives are also provided to support economic

decision in breakthroughs in many key industries in Vietnam
Vietnam However, to ensure investment success, it's important to have a

good understanding of the legal and regulatory framework
surrounding corporate structure and taxation in Vietnam
32
Geopolitical advantages (1/2)
Relatively more politically stable than neighboring countries

Vietnam vs. neighboring ASEAN countries, Indices in percentile rank
Vietnam is considered having lower
probability of political challenges and
geopolitical disruptions than its regional
peers
*Note: lower figure =
higher ranking = lower risk
of disruptions
Attributed to:
● “bamboo diplomacy” highlighting the

greatest prioritization of maintaining
peace, preventing conflict, and fostering
international cooperation in the context
of the rapidly changing world, and
● a single-party democracy system that

brings a high degree of governmental
stability.
(*) percentile rank, rankings over 163 independent states and territories, 0 is the highest ranking, 100 is the lowest ranking, data from Institute for Economics & Peace.
33
(**) percentile rank, rankings over 213 countries and territories, 0 is the highest ranking, 100 is the lowest ranking, data from World Bank.
Source: EY, World Bank, Institute for Economic & Peace, Press releases
Geopolitical advantages (2/2)
Vietnam emerges as a destination for China+1 strategy
Foreign-owned corporations in Vietnam (with amount of foreign capital invested in million USD) Multiple global giants name Vietnam as
a long-term manufacturing base
$20,000 The massive influx of FDI inflows can be

attributed to increasing attractiveness of
Vietnam as a solution for the China+1
strategy.
South Korea and Japan are among the

first countries setting their production
plants in Vietnam since the 1970s and still
remain the top contributors to Vietnam’s
FDI until the present day.
Manufacturing is the leading sector

attracting the most FDI due to Vietnam’s
favourable mix of competitive human
cost, standard corporate tax rate, and
being a member of many economic trade
zones.
34
** The graph is for illustrative purposes only and does not represent an exhaustive list of all foreign-invested manufacturers in Vietnam.
Source: Press release, Vietnam General Statistics Office
Ease of doing business: Legal requirements
Business sectors that foreign investors can access (Decree 31/2021/ND-CP guiding the Law on Investment 2020)(*)
Foreign investors are Foreign investors are Foreign investors are

not allowed allowed with conditions allowed
Sectors which are not yet accessible for Sectors which are accessible with Foreign investors have the same market
foreign investors (Prohibition List of conditions for foreign investors (Market access as that of domestic investors
Appendix I of Decree 31/2021/ND-CP) Entry List of Appendix I of Decree (sectors not being mentioned in
31/2021/ND-CP): Prohibition List and Market Entry List)
• Foreign-owned ratio
• Form of investment
The Government does not commit on
• Scope of investment
market access, foreign investors may be
• Investor capability and others
subject to restrictions under Vietnam’s
=> In-principle approval of higher-level
domestic law in the corresponding
competent authorities required
Example: Security services, goods and services Example: Nuclear power plant, special use forests,
industries/sectors.
under state monopoly, Administrative and judicial headwater protection forests or border protection
services, Manufacture of military equipment or forests; construction of airports, terminals;
materials, etc. petroleum processing; betting and casino for
foreigners; golf courses; etc
(*) Full English version on Legal update of Decree 31/2021/ND-CP is available at Decree 31/2021/ND-CP EN | KPMG. 35
**For more information on List A and B of Appendix 1 of Decree 31/2021/ND-CP, view Appendix - Prohibition List & Appendix - Market Entry List.
Source: Vietnam Law on Investment, view full detail at LEGAL FRAMEWORKS ON DOING INVESTMENT VIETNAM (mpi.gov.vn).
Ease of doing business: Legal requirements
Procedures to set up a company Procedures of registration process (Projects not under in-principle review) (**)
Foreign investors are required to complete
the necessary registration process with Projects located INSIDE
Provincial
the relevant licensing bodies in order to industrial zones (IZ), export
Seek approval Management
processing zones (EPZ),
legally engage in business operations in economic zones (EZ) and Hi-
from Authority of
Vietnam. The new Law on Investment and the Zones
tech park IRC
Law on Enterprises requires foreign issued
investors to follow 2 mandatory steps:
Provincial
1 Acquiring the Investment Registration Certificate (IRC) (*)
Department
Projects located OUTSIDE Seek approval
2 Acquiring the Enterprise Registration Certificate (ERC) of Planning
IZs, EPZs, EZs, Hi-tech parks from
and
(*) IRC is required only for investments by foreign investors or deemed-to-be foreign
investors (i.e. companies with more than 51% of charter capital held by foreign
Investment
ownership).
Step 1 Step 2 Step 3

Provincial
ERC Department
Online/Offline
Application dossier for
(3 days) submission
issued of Planning company set-up
and (IRC included)
Location IRC ERC Set-up & Investment
selection Application Application Announce
(15 days) (3 days)
(**) Article 39 Law on Investment No.61/2020, Law on Enterprise No. 59/2020/QH14, dated 17 June 2020, issued by the National Assembly of Vietnam 36
Number of days mentioned above are counted as business working days. View full detail at LEGAL FRAMEWORKS ON DOING INVESTMENT VIETNAM (mpi.gov.vn)
Source: Vietnam Investment Law, reproduced from Deloitte, EY
Ease of doing business: Case studies
Case studies of foreign companies entering Vietnam market via M&A
Acquirer Target Detail
Year of deal: 2011

Asset transfer: market share of 60%, 54 screens in 7 locations.
a South Korean top exhibitor a leading Vietnam-based Transaction value: $73.6m
Market Entry
cinema chain
Year of deal: 2014

Asset transfer: 19 wholesale stores across the country, more
a Thai colomegrate having wholesales
a subsidiary of Metro AG, a German retail than 3300 employees
company specializing in wholesale Transaction value: ~ $711m
and retail business
distribution
Year of deal: 2017

Asset transfer: 8 branches located in Hanoi and Ho Chi Minh
a leading commercial bank in South retail arm of ANZ Bank in Vietnam - an City, and ongoing roles for all retail staff.
Market Expansion
Korea, established representative Australian-based provider of banking Transaction value: undisclosed

office in Vietnam in 1993 services
Year of deal: 2018

Asset transfer: Uber’s operations in SEA (Cambodia, Indonesia,
a Singaporean-based ride-hailing a ride-hailing platform, entered Malaysia, Myanmar, the Philippines, Singapore, Thailand and
and on-demand delivery platform, Vietnam in 2014 and being Grab’s Vietnam).
entered Vietnam in 2014 direct rival Transaction value: ~ $1.65b (as a part of regional deal (*))
37
(*) Golden Gate Ventures estimation based on announced Uber will hold a 27.5% stake in Grab, while Uber’s CEO will join Grab’s management board. Prior to Uber deal in 2018, Grab had a valuation of $6b.
Source: Press releases, MarketLine
Legal and regulatory framework (1/3)
Type of corporate structures
Limited Liability Company Joint Stock Company Partnership Private Enterprise Joint Venture
Established by its Established by general Established by the owning partners of

Establishment
With two or more

With one member founding shareholders on partners. A Established by a a foreign-invested Joint Venture with
members
the basis of their partnership may single individual. at least two foreign entities or at least
Established by its member(s) by way of capital subscription to shares of include limited one foreign and one local entity. A
contribution to the LLC. the Joint Stock Company partners. partnership of companies are created
(JSC). for a specific business purpose.
Ownership
Minimum contribution of 30%

Legal entities or At least 3 shareholders. At least two general Owned by a single individual. from foreign ownership. However,
One legal entity individuals. Maximum No maximum number partners who must the government also mandates
or individual. number must not of shareholders. be individuals. minimum contributions for
exceed 50. domestic partners in JVs in some
industries.
The company The members are liable The shareholders are A general partner is The owner is liable for JV can be incorporated as a LLC
owner is liable for for the debts and other only liable for the liable for the company’s the entire operation or JSC (if there are more than 3
Liability
the debts and liabilities of the entity to debts and other obligations equal to all of the company investors/parties). Each party is
other liabilities to the extent of their capital liabilities of the entity of his/her assets. A equal to his/her total responsible for the company
the extent of the contributions, except for to the extent of their limited partner is liable assets. within the scope of its capital
company’s the case specified in capital contributions. for the company’s debts contribution to the charter capital
charter capital. Clause 4 Article 47 of the equal to the promised of the company.
LOE 2020. capital contribution.
38
Source: EY, Vietnam National Law, LOE No. 59/2020/QH14, dated 17 June 2020, issued by the National Assembly of Vietnam
Joint Ventures are very popular, why?
Establishing a joint venture (JV) with a local business(es) is a popular method used by foreign companies to enter the Vietnamese market
thanks to the expertise of the local partner(s), as well as the low compliance risk. In some cases, it also is the only option for overseas brands to
enter Vietnam. This is especially applicable when it comes to the industries that have a limit on foreign ownership of the business. Below are
some examples of the benefits that foreign companies can expect from this collaboration model.
Compliance with local regulations Access to local expertise

Some industries limit foreign ownership as some industries A great benefit of a JV is that you can utilize the local experience and
that are considered to be sensitive by the government. network of the domestic Vietnamese partner.
Below you can find a handful of industries and the foreign ● Foreign companies can establish their footprint in the
ownership limitations: domestic market while enjoying external support from
someone familiar with the market for years. You and your
● Banking – 30% partner can then bring your own strengths to further develop
● Goods transportation by rail or domestic waterway – the JV.
49% ● Your partner will support with related paperwork and
● Goods transportation by road – 51% documentation, as well as deal with local authorities. They can
● Cargo handling services – up to 50%, depending on also provide insights about local practice, as well as
the type of cargo established relations with relevant stakeholders, such as
suppliers and distributors.
Therefore, establishing a JV might be the only way in for ● Meanwhile, the foreign partner is expected to bring
foreign companies in certain industries. However, this is experience of globalization, technological innovation, and
more complicated and requires significantly more resources know-how, which typically are the weaknesses of the local
from the investors, both in terms of legal documents and party. Hence, the addition of a foreign company is considered
human capital. a competitive advantage over local peers in the same
industry.
39
Source: ARC Group
Example of Joint Ventures in Vietnam Foreign Vietnam Ownership
Ownership
Honda Vietnam Cuu Long JOC Yamaha Motor Vietnam CALOFIC Corporation
Hong Leong Yamaha Motor Vietnam Vegetable Oils

Monaco's Geopetrol
Industries Berhad Company Ltd. Industry Corporation
company
SK Group Malaysia Japan (Vocarimex)
Japan Honda
Vietnam Motor Company Korean National
Engine and Oil Corporation
Agricultural
Machinery
Corporation
UK's
ConocoPhillips
Cuu Long Co. Ltd PetroVietnam
Thailand Asian Honda Vietnam Forestry Corporation & Wilmar International (Singapore)
Motor Company Co Do Mechanical Factory
After the transition to exploitation and CALOFIC is one of the most successful
Established in 1998 and operating in joint venture companies across
production in 2003, Cuu Long JOC
Up to now, Honda Vietnam has invested the field of manufacturing and Vietnam and has spearheaded the
always holds the 2nd position in Vietnam
over 400 million USD in the construction of assembling motorcycles, Yamaha manufacturing and processing of
regarding crude oil output and export
3 factories including two motorcycle Motor Vietnam Company Limited now vegetable oils in the country. CALOFIC
revenue. In 2022, the firm’s estimated oil-
factories and an automobile assembly plant has more than 300 dealers and stores operates over two factories in Quang
equivalent production is expected to
in Vietnam, creating jobs for thousands of in Vietnam, a strong step up from only Ninh and Ho Chi Minh City, capable of
reach 25.25 million barrels, earning 1.44
workers. 33 stores in 1999. an output of 2,300 tons/day-night, and
billion USD and paying 863 million USD
to the State budget. offices in both Hanoi and Ho Chi Minh
City. Across the nation, almost 1,000
people work for the enterprise.
40
Source: VEAM, Apollo.io, VNA, VIETSOVPETRO, CALOFIC
Business Taxes
Tax Treaties Vietnam’s Double Taxation Agreements
Summary of Withholding Tax Rates Contained Within each Agreement
Double taxation avoidance agreements (DTAAs) prevent businesses from
being double-taxed on their income. Vietnam currently has approximately
Treaty Dividends Interest Royalties Refund of
80 DTAAs signed. These treaties effectively eliminate double taxation by Partner (%) (%) (%) excess tax
identifying exemptions or reducing the amount of taxes payable in
Vietnam.
Corporate income: For foreign-invested enterprises (FIEs), corporate 5/7/12.5 10 5/10 7.5 - 15%
income is what is earned from carrying out production and business
activities in Vietnam.
Income earned from Vietnam by FIEs
Dividends
●
No treaty benefit applies to dividends under DTAAs as there is no
10 10 10 10%
withholding tax on dividends in Vietnam. Companies are required to fulfill
their financial and tax obligations in Vietnam before remitting dividends to
their overseas parent companies. This means that the remitted dividends
are after-tax profit which can be taxed again in the other signatory
countries. Most tax and revenue jurisdictions allow tax offset for tax paid in 10 10 5/15 5 - 15%
other countries on dividends received.
● Interest & royalties

Interest & royalties are taxed around 5% to 10%. Tax on the interest is
usually exempt under most DTAA while tax in royalty income is often
reduced and ranges from 5% to 15%.
10 10 10 10%
● Technical, management, and consulting services
Tax on service fees is often withheld at 10 percent, in which 5% is of value-
added tax (VAT) and the other 5% portion is CIT. Under DTAAs, only the CIT
portion is subject to an exemption.
Note: In most cases, the limits set by the DTAAs are higher than the present withholding rates under domestic law; thus, the domestic
rates will apply.
* The refund of excess tax = standard CIT (20%) - the double tax treaties maximum tax rate
** The list does not represent an exhaustive list of all DTAAs
41
Source: PwC Vietnam, Acclime Vietnam, Vietnam Briefing
Appendix –
Ecosystem maps
An interconnected economic ecosystem creates solid
ground for growth and success of Vietnam’s economy
LOCAL
COMPANIES
VN
PE/VC STARTUPS
ECOSYSTEM
MULTI-
NATIONAL
CORPORATIONS
43
Ecosystem map (1/4)
Non-exhaustive
LARGEST PUBLIC LOCAL COMPANIES BY SECTOR
Vietcombank - Banking VINHOMES - Real Estate

Market cap $20.94B Market cap $10.82B
a foreign trade bank that provides a wide range of financial services in develops and trades integrated residential, commercial and industrial real
international trade. estate, and provides real estate management and related services.
BIDV - Banking
Market cap $9.96B Vinamilk - Consumer goods
Market cap $6.47B
a Vietnamese commercial and state-owned bank engaged in the provision of
investment banking services for individual customers, corporate customers, and a nutrition corporation providing dairy products, ranging from core dairy
financial institutions. products to value-added dairy products.
Vietinbank - Banking SABECO - Consumer goods

a State-owned commercial bank whose traditional services as well as other
modern and valued added services have reached all nation-wide users. a leading beverage company, produces and sell beer, alcohol, beverages and
related products including material and packaging materials
PetroVietnam Gas - Utilities Hoa Phat - Manufacturing

an industrial manufacturing company focusing on steel production. Its

has main business in gathering, importing, transporting, storing, processing and business includes trading and producing Furniture, Steel Pipe, Steel,
trading of gas and gas products Refrigeration, Real Estate, and Agriculture.
Date of valuation: July 21st, 2023

44
** The list is not ordinal and does not represent an exhaustive list of all entities in Vietnam.
Source: Crunchbase, Press release, TradingView
Ecosystem map (2/4)
Non-exhaustive
PE/VC WITH AUM >US$ 50M
KKR - PE Golden Gate Ventures - VC
AUM $504B AUM US$250M
a global investment firm that focuses on real estate, infrastructure, a Southeast Asian venture capital firm that brings together knowledge and experience
Global
digital transformation, food, consumer goods, and technology in Vietnam from Silicon Valley with passion and ambition for Southeast Asia.
Warburg Pincus - PE
AUM $83B
a leading global private equity firm; one of the largest PE investors iin Vietnam
VinaCapital - PE VinaCapital Ventures - VC

AUM $3.9B AUM $100M
a leading investment management and real estate development firm in Vietnam. a Vietnam-focused venture capital focusing on investing in and building world-class
technology companies and incorporating them into a full digital ecosystem.
Ascend Vietnam Ventures - VC

Local
Vietnam Investment Group - PE

AUM $560M AUM $64M
a private equity firm that focuses on high-growth businesses in Vietnam. an early-stage venture capital firm on a mission to empower tech entrepreneurs
in Vietnam.
Mekong - PE
Do Ventures - VC
AUM $490.5M
AUM $50M
a Vietnam-focused Private Equity firm, specializing in consumer driven businesses an early-stage VC firm focusing on investing in technology companies in Vietnam and
such as retail, restaurants, consumer products and distribution. Southeast Asia.
45
Source: Crunchbase, Press release
Ecosystem map (3/4)
Non-exhaustive
STARTUPS RAISED >US$ 20M
VNLIFE - Fintech - Digital payment Trusting Social - Fintech - Credit data

Raised $550M Raised $214M
a leading digital payment platform in Vietnam, offering secure and convenient a Vietnam-based fintech company specializes in alternative credit scoring and data
electronic payment solutions to individuals and businesses. analytics, leveraging innovative technologies to provide financial inclusion and
access to credit for underserved populations.
MOMO - Fintech - Digital payment Buymed - Ecommerce - B2B

Raised $434M Raised $63.5M
a prominent digital wallet and payment platform in Vietnam, providing users with operates an e-commerce website that connects pharmaceutical manufacturers,
a secure and convenient way to make online and offline transactions distributors, and clinics. Its platform, Thuocsi.vn, works on various projects, including
e-commerce, seller centers, supply portals, WMS, POS, and logistics services.
TIKI - Ecommerce - Marketplace OnPoint - Ecommerce - Enabler

a Vietnam-based e-commerce platforms, offering a wide range of products with a a prominent ecommerce enabler offering a range of services and solutions to help
focus on providing customers with a convenient and reliable online shopping businesses establish and optimize their online retail presence, including website
experience. development, digital marketing, logistics management, and payment integration.
SKY MAVIS - Blockchain - Enabled business KiotViet - SaaS

Sky Mavis is the creator of Axie Infinity, a popular blockchain-based game that a popular point-of-sale (POS) system provider in Vietnam, offering businesses a user-
combines elements of gaming and decentralized finance, allowing players to earn friendly and feature-rich software solution to manage sales, inventory, and customer
cryptocurrency by collecting, breeding, and battling digital creatures called Axies. data, streamlining their retail operations and enhancing overall efficiency.
46
Source: Crunchbase, Press release
Ecosystem map (4/4)
Non-exhaustive
MULTINATIONAL COMPANIES WITH HEAVY ROOT IN VIETNAM

VIETNAM
Samsung Electronics - Manufacturing Nestle - Consumer goods
Invested $18B Invested $730M
is a major subsidiary of the South Korean-based global electronics giant, Samsung, is a Swiss food and beverage company, offering a diverse range of nutritional
operating manufacturing facilities and research centers in Vietnam, representing products and beverages to Vietnamese consumers.
the largest source of FDI from South Korea into Vietnam.
LG Electronics - Manufacturing Honda - Manufacturing

Invested $5.3B Invested $535M
is a subsidiary of South Korean LG Corporation, involved in manufacturing and is a Japan-based automotive manufacturer and distributor, producing a wide
supplying a wide range of innovative consumer electronics and home appliances in range of motorcycles and automobiles
high quality.
Intel - Manufacturing Foxconn - Manufacturing

Invested $1.5B Invested $503M
is a Taiwan-based consumer electronics and electronic components
is a key manufacturing and research subsidiary of the US-based Intel Corporation in manufacturer, known for assembling for Apple’s product
Vietnam, producing and developing a wide range of cutting-edge semiconductor
products.
Unilever - Consumer goods

Heineken - Consumer goods Invested $300M
Invested $1B
is a subsidiary brewery as a part of the Dutch Heineken global brand, producing and is a British consumer goods company, offering a portfolio of well-known brands in
distributing high-quality beers to Vietnamese consumers. personal care, home care, and food products.
47
Source: Press release
Appendix –
Exits
Vietnam IPO Market Overview
Snapshot IPO Breakdown By Industry
● Vietnam’s IPO market saw 8 successful listings in 2022. While this is ● The IPO market focus has shifted from Real Estate in 2021
lower than the 13 listings recorded for 2021, the amount raised has to the local capital market dominance of Industrial
more than quadrupled, from US$15.6 million to US$71.4 million. Products ($35.7 million) and Consumer Business ($22.3
million) in 2022.
● Top 3 IPO deals in 2022 were Ton Dong A Corporation with US$27
million raised, Nova Consumer Group with US$21 million, and ● Consumer Business is foreseen to continue to play a vital
Green Plus Joint Stock Corporation with US$7 million raised. role, with highly anticipated upcoming listings from this
sector. Specifically, we expect to see a few Retail and FMCG
● In January 2023, Vietnam witnessed 5 successful IPOs, including companies go IPO in the near future.
VNG Corporation, Green Plus JSC, Da Nang Public Lighting JSC, 120
Mechanical JSC, Vinatrans DaNang JSC.
IPO Fund Raised in recent years (US$'m) 2022 IPO Fund Raised breakdown by industry
Financial Services
9%
Industrial Products
50%
Consumer
Business
31%
Life Sciences & Health Care

Deals count 1 13 8
10%
49
Source: Deloitte, News article
It is estimated that the domestic public market may become an
active channel for local startups in ~5 years
Vietnam is expected to witness more IPO cases
Country Unicorn Startups Industry Established IPO Time gap
within 2025-2027, lagging about 5 years behind
regional countries like Singapore and Indonesia. The
Technology 2009 2022 13 years estimation is based on:
VN strict IPO standards

E-commerce 2010 2022 12 years Vietnam's current regulations for IPO standards are
still strict to minimize risks for investors, which is not
supportive for startups:
Indonesia E-commerce 2010 2021 11 years ● Any issuer must have ROE of at least 5% in the
year preceding the year of the listing
application.
Technology 2012 2021 9 years ● Must have profitability for the 2 consecutive
years before the year the listing application is
made.
Technology 2005 2017 12 years
VN startup ecosystem is still young vs. peers
Technology 2009 2017 8 years Peers like Indonesia and Singapore already have well-
Singapore established startup ecosystems early on. In 2000, tech
companies sprouted up in Vietnam, but it was really in
2016 that the country's startup ecosystem was fully
complete with all of its components, along with the
Technology 2004 2023 19 years
approval of Project 844 by the Prime Minister and
technology improvement (notably the growth of the
E-Logistics 2013 TBD* 10+ years internet and social media)
VN maturity of financial market

Vietnam Fintech 2007 TBD* 15+ years The time gap also shows a trend that the maturity of
the financial markets shortens the time IPO, given
that those of Singapore and Indonesia are more
mature than Vietnam's.
*To be determined 50
** The list is not ordinal and does not represent an exhaustive list of all unicorn startups in three countries.
Source: Company websites, Crunchbase, Press release, Techsauce, Asia Development Bank
Vietnam M&A
NOTABLE VIETNAM M&A TRANSACTIONS
As global players become more interested in
SEA region, Vietnam domestic market is
Date Investor Target Sector Value (US$m) Stake
expected to support acquisitions worth of
$250M, especially big unicorns. Jun-20 KKR’s consortium Vinhomes Real Estate 651 6%
Oct-18 SK Investments Masan Group Consumer 474 9%

Internet/Fintech/Game
Investors: IDG Ventures,
Tencent, Goldman Sachs, Aug-18 Hanwha Asset Management Vingroup Diversified 403 Undisc.
Temasek, Chiratae Ventures,...
May-21 Alibaba, BPEA The CrownX Consumer 400 6%
Fintech/E-commerce Dec-18 Warburg Pincus Techcombank Financial Services 370 4%

Investors: GIC, SoftBank,
General Atlantic, Dragoneer Dec-21 TPG, Temasek, ADIA The CrownX Consumer 350 5%
Investment Group,...
Jul-19 GIC, Softbank VNPay Technology 300 Undisc.
Fintech (Payment) Jan-19 GIC, Mizuho Vietcombank Financial Services 264 3%

Investors: Goldman Sachs,
Warburg Pincus, Mizuho
Bank,... Jun-22 Warburg Pincus Novaland Real Estate 250 Undisc.
Jul-21 General Atlantic, Dragoneer VNPay Technology 250 Undisc.

Game Blockchain
Investors: Mark Cuban, May-22 Shinhan Financial Group Tiki E-commerce 90 10%
Andreessen Horowitz,
Binance,...
*The list is not ordinal and does not represent an exhaustive list of all M&A transactions in Vietnam.
51
Source: BDA Partners, CafeF, VNExpress
Appendix –
Vietnam FTAs
VIETNAM FTAs
FTAs Signing members

10 ASEAN member countries (Brunei, Cambodia, Indonesia, Laos, Malaysia,
ASEAN Trade in Goods Agreement (ATIGA)
Philippines, Singapore Thailand, Vietnam)
Comprehensive and Progressive Agreement for Trans-PacifiC Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru,
partnership (CPTPP) Singapore, and Vietnam (*)
ASEAN - Japan Comprehensive Economic Partnership (AJCEP) 10 ASEAN member countries and Japan
ASEAN - Korea FTA (AKFTA) 10 ASEAN member countries and Korea Republic
ASEAN - India ETA (AIFTA) ASEAN member countries and India
ASEAN - China FTA (ACFTA) 10 ASEAN member countries and China
ASEAN- Hong Kong FTA 10 ASEAN member countries and Hong Kong
ASEAN - Australia - New Zealand (AANZFTA) 10 ASEAN member countries and Australia, New Zealand
Vietnam - Chile FTA (VCFTA) Vietnam, Chile
Vietnam - Korea (VKFTA) Vietnam, Korea Republic
Vietnam - Japan Economic vetnam, Japan
Vietnam - Eurasian Economic Union FTA (VN-EAEU FTA) Vietnam, Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia
Vetnam - European Union FTA (EVFTA) *Good exported from Vietnam
Vietnam, 27 EU member states
to the EU are still entitled to GSP benefits until 31
10 ASEAN member countries and Australia, China Mainland, Japan, Korea Republic,
Regional Comprehensive Economic Partnership (RCEP) (**)
and New Zealand
Vietnam - UK FTA (UKVFTA) (***) Vietnam, the United Kingdom
Notes: (*) The CPTPP Agreement officially took effect on 30 December 2018. The CPTPP took effect in Vietnam on 14 January 2019.
(**) RCEP agreement was signed on 15 November 2020 and entered into force on 1 January 2022. (***) The UKVFTA was signed on 29 December 2020. The Agreement has been temporarily applied from 23:00 p.m.
on 31 December 2020 GMT or 6 a.m. on 1 January 2021, Vietnam time and officially took effect on 1 May 2021 53
Source: EY from Website of WTO Center under Vietnam Chamber of Commerce and Industry at https://www.trungtamwto.vn/, Vietnam General Consulate Houston.
Appendix –
Vietnam Market condition list
Vietnam Market Entry Condition List
Appendix I of Decree 31/2021/ND-CP: Prohibition List (foreign investors are not allowed)
Trading goods and services on the list of goods and services on which monopoly is held by the Navigation services to ensure maritime safety in water areas, water areas and public
1 21
State in the commercial sector. navigational channels; marine electronic information service.
2 Press activities and information gathering in any form. Inspection (inspection, testing) and certification services for means of transport (including
Fishing. systems, components, equipment, components of vehicles); inspection and issuance of
3
certificates of technical safety and environmental protection for vehicles, specialized equipment,
4 Security and investigation services.
containers, and dangerous goods packaging equipment used in transportation; inspection
Judicial administration services, including judicial assessment services, poste restante services,
5 22 services and issuance of certificates of technical safety and environmental protection for oil and
property auction services, notary services, liquidator services.
gas exploration, exploitation and transportation means and equipment at sea; technical
6 Overseas contracted employment agency services.
inspection service of occupational safety for machines and equipment with strict requirements
Investment in the construction of infrastructure of cemeteries and graveyards to transfer land on occupational safety installed on means of transport and means, exploration and exploitation
7
use rights associated with such infrastructure. equipment and oil and gas transportation at sea; fishing vessel registry services.
8 Waste collection services directly from households.
Natural forest investigation, assessment and exploitation services (including gathering wood
9 Public opinion polling service (public opinion polling).
23 and hunting, trapping rare wild animals, management of the sources genes for plants, livestock
10 Blasting services. and microorganisms used in agriculture).
11 Manufacture and trade in weapons, explosives and supporting tools.
Researching or using genetic resources of new livestock breeds before being appraised and
12 Import and dismantling of used seagoing vessels. 24
evaluated by the Ministry of Agriculture and Rural Development.
13 Public postal services. 25 Tourism services, except international tourism services for international tourists to Vietnam
14 Goods transshipment business.
15 Temporary import for re-export business.
Exercise of the right to export, import, and distribution of goods on the list of goods for foreign
16 investors, foreign-invested economic organizations are not allowed to exercise the right to
export, import, distribute.
17 Collection, purchase and handling of public goods in armed forces units.
Trading in military materials or equipment and supplies for the people's armed forces, military
weapons, technical equipment, ammunition and specialized vehicles used for the army and
18
police; components, accessories, spare parts, supplies and specialized equipment and
technology used for their production;
19 Intellectual property representation services and industrial property assessment services
Services of the establishment, operation, maintenance and maintenance of aids to navigation,
water zones, water areas, public navigational channels and maritime routes; service of surveying
water zones, water areas, public navigational channels and maritime routes serving maritime
20 notices; services of surveying, constructing and publishing nautical charts for waters, seaports,
navigational channels and maritime routes; building and publishing marine safety documents
and publications.
55
Source: Vietnam Law on Investment
Vietnam Market Entry Condition List
Appendix I of Decree 31/2021/ND-CP: Market Entry List (foreign investors are allowed with conditions)
1 Production and distribution of cultural products, including visual recordings 32 Auditing, accounting, bookkeeping and tax services.
Production, distribution and broadcast of television programs and music, stage performance 33 Valuation services, consulting services on corporate valuation for equitization.
2
and motion picture works. 34 Services related to agriculture, forestry and fishery.
3 Supply of radio and television services. 35 Aircraft manufacturing.
Insurance, banking, securities brokerage, and other services related to insurance, banking, and 36 Manufacture of railway locomotives and wagons.
4
securities. Trading tobacco products, tobacco raw materials, and specialized machinery and equipment for the
5 Postal services, telecom services. 37
tobacco industry.
6 Advertising services. 38 Publishers' activities.
7 Printing service, publication issuance services. 39 Ship building, and repair services.
8 Measurement and mapping services. 40 Waste collection services, environmental observation services.
9 FlyCam services. 41 Commercial arbitration services, arbitration mediation services.
10 Educational services. 42 Logistic services.
11 Exploration, extraction and process of natural resources, minerals, oil and gas. 43 Coastal shipping.
12 Hydropower, offshore wind power and nuclear energy. Cultivation, production or processing of rare crops, breeding of rare wild animals, processing and
Transport of goods and passengers by railway, airway, road, waterway and conduit [pipeline]. 44
13 handling of these animals or plants, including live animals and products thereof.
14 Aquaculture cultivation or breeding. 45 Production of construction materials.
15 Forestry and hunting. 46 Construction and related technical services.
16 Betting and casino business 47 Motorcycle assembly.
17 Security guard services. Services related to sports, art activities, performing arts, fashion shows, beauty and model contests,
48
18 Construction, operation and management of river ports, seaports and airports. and other entertainment.
19 Real estate business. Air transport support services; ground technical services at airports and airports; catering services on
49
20 Legal services. the aircraft; navigation information services, aviation meteorological services.
21 Veterinary services. 50 Sea transport services; shipping tugboat [ship towing] services.
Goods sale and purchase activities and activities directly related to goods trading activities of Services related to cultural heritage, copyright and related rights, photography, video recording,
22 51
foreign service providers in Vietnam. recording, art exhibitions, festivals, libraries, museums.
23 Technical inspection and analysis services. 52 Services related to tourism promotion.
24 Travelling [tourism] services. 53 Agent, recruitment and scheduling, management for artists, athletes’ services.
25 Health and social services. 54 Family related services.
26 Sports and entertainment services. 55 E-commerce activities.
27 Paper production. 56 cemetery business, cemetery services and funeral services.
28 Manufacture of transport vehicles with more than 29 seats. 57 Airborne seeding and chemical spraying services.
29 Development and operation of wet markets. 58 Maritime pilotage services;
30 Commodity Exchange operations. Investment sector, business lines under the pilot mechanism of the National Assembly, The Standing
59
31 Domestic LCL collection services. Committee of the National Assembly, the Government, and the Prime Minister.
56
Source: Vietnam Law on Investment
Vietnam Market Entry Condition
Briefings of some conditions under Market Entry with condition (Vietnam’s Law on Investment 2020)
(*) Foreign-owned ratio:

Foreign investors have the right to possess unlimited charter capital in a business entity, with a few exceptions:
● For listed companies, public companies, securities trading organizations, and securities investment funds under law on securities: comply with law
on securities
● For state-owned enterprises undergoing equitization or transformation: comply with the provisions of the law on equitization and transformation of
state-owned enterprises.
● For other cases: comply with comply with other provisions of relevant laws and international treaties to which the Socialist Republic of Vietnam has
ratified.
(**) Form of investment:
Foreign investors have two main approaches: direct investment or indirect investment. The various forms of foreign investment in Vietnam including:
● Establishing economic organizations through investment.
● Investing through capital contribution, purchasing shares, or acquiring capital contributions.
● Carrying out investment projects.
● Investment in the form of a business cooperation contract (BCC).
● Exploring new investment forms and economic organizations as stipulated by the government's regulations.
(***) Scope of investment:
● In industries and sub-sectors where Vietnam has made commitments and foreign investors fulfill the investment conditions, the investment
registration agency will review and approve the IRC or registration of capital contribution, share purchase, or capital contribution of foreign investors
according to the Law on Investment.
● For service sectors and sub-sectors not covered by Vietnam's commitments in international investment treaties or specified in the Schedule of
Commitments, but are subject to investment conditions under Vietnamese law, foreign investors must comply with the provisions of Vietnamese
law.
*Full detail can be found at LEGAL FRAMEWORKS ON DOING INVESTMENT - INVESTMENT PROMOTION CENTER - SOUTH VIETNAM (mpi.gov.vn) 57
Source: Vietnam Law on Investment 2020
References
Reports Online Database
● Bain and Temasek, with contributions from Microsoft, “Southeast Asia’s ● Crunchbase
Green Economy 2022 Report: Investing behind new realities” ● Passport Euromonitor
● Ernst & Young, “Doing Business in Vietnam 2022” ● Vietnam Ministry of Planning and Investment
● Deloitte, “Doing Business In Viet Nam 2022-2023” ● Stock information: TVSI, BVSC, Stockbiz.vn,
● Do Ventures, “VIETNAM INNOVATION & TECH INVESTMENT REPORT TradingView, Investing.com, MarketWatch, Yahoo!
2023”
Finance
● PwC, “The future of ASEAN: Vietnam Perspectives”
● Google, Temasek, Bain & Company, “e-Conomy: SEA 2022” ● State Bank of Vietnam
● World Bank Group, “Ease of doing business 2020” ● International Monetary Fund
● Fitch Solutions, “Vietnam Trade & Investment Risk Report” ● World Bank Open Data
● ISEAS Yusof Ishak Institute, “Vietnam’s Over-reliance on Exports and FDI” ● Philippine Statistics Authority
● World Bank Group, “Vietnam: Toward a Safe, Clean, and Resilient Water ● Singapore Department of Statistics
System 2019”
● Vietnam General Statistics Office
● KPMG, “Vietnam Supply Chain at a Glance 2021”
● Ministry of Finance, “Report on equitization process of SOEs over period
of 2016−2018”
● Deloitte, “Southeast Asia IPO Capital Market 2022 Full Year Report”
● ASIAN DEVELOPMENT BANK, “VIET NAM’S ECOSYSTEM FOR
TECHNOLOGY STARTUPS”
58
References
Other sources
● Tax Incentives | Vietnam Briefing ● An Introduction to Double Taxation Avoidance in Vietnam |

● Vietnam National Law Vietnam Briefing
● ARC Group ● Private Equity 2022 - Vietnam | Global Practice Guides
● Yamaha Motor Vietnam information
● The Vital Role of the Private Sector in Vietnam’s Green
● HONDA VIETNAM COMPANY
● Additional offshore oil field begins operation | VIETSOVPETRO Financing | ARC Group
● About CALOFIC ● Vietnam - Country Profile | Export Finance Australia
● Institute for Economics & Peace ● Vietnam - Country Risk | Allianz Research
● Geography of VietNam ● Vietnam - Economic Studies and Country Risks | La Coface
● WTO Center ● Asset-Light Supply Chain | Accenture
● Foreign Policy | About Vietnam
● Asset-light and flexible freight transportation to enable supply
● Crowe Vietnam
chain of the future | KPMG
● The Little Data Book on Financial Inclusion 2018 | World Bank
● FinTech in ASEAN 2022 | UOB Tech Ecosystem ● Infrastructure | Open Development Vietnam
● WHY VIETNAM? ● Why Invest in Vietnam?
● HealthTech in Vietnam| Insignia ● In brief: acquisition and exit strategies for private equity firms
● Taxes on corporate income | PwC Vietnam in Vietnam | Freshfields Bruckhaus Deringer
● Withholding taxes | PwC Vietnam ● Mekong Capital's past investment | Mekong Capital
● Vietnam Double Tax Agreement (2023) | Acclime Vietnam
59
References
Press releases
● TechInAsia
● DealStreetAsia
● Vietnam’s Bamboo Diplomacy: From Tradition to Innovation (VietnamPlus)
● Three Vietnamese seaports among TOP 100 largest container ports worldwide
● Shinhan Bank Vietnam To Acquire Anz Vietnam’s Retail Division | Shinhan Bank
● CJ CGV acquires Vietnam’s leading cinema chain (koreanfilm.or.kr)
● Thai TCC Group becomes new owner of METRO Cash & Carry Vietnam (vir.com.vn)
● Southeast Asia’s Grab lands $1B from Toyota at a $10B valuation | TechCrunch
● TPG buys majority stake in Vietnam school, Mekong exits | AVCJ
● SG buyout firm Growtheum invests $100m in Vietnam's International Dairy Products (dealstreetasia.com)
● Thai Beverage unit wins auction to buy 54 percent stake in Sabeco | Reuters
● Central Group officially owns Big C Vietnam (vir.com.vn)
● Cuu Long JOC oil production likely to hit 400 million barrels this year | VNA
● Ørsted plans building 3.9-GW offshore wind farm in Vietnam - report (renewablesnow.com)
● Vietnam says AES Corp intends to develop $13-billion wind farm (yahoo.com)
● Vietnam's BCG Energy inks USD-400m MoU with Siemens Gamesa (renewablesnow.com)
● Sembcorp, BCG Energy aim to develop 1.5 GW of renewables in Vietnam (renewablesnow.com)
● Warehousing continues to rise unabated in local market
● Vietnam ‘not ready’ for looming solar waste issue amid recent boom | climatetracker
● Vietnam ranks 5th in economic openness in Asia: Fitch | Vietnam Chamber of Commerce and Industry
● Vietnam is fifth most open economy in Asia | VIR
● Disposal of Big C Vietnam for a valuation of 1 billion euros | Groupe Casino (groupe-casino.fr)
● Inadequacy in the price mechanism, many solar and wind power projects face great difficulties (nhandan.vn)
● State-owned enterprises - good and bad | Vietnamnet
60
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Disclaimer
This communication has been prepared by Golden Gate Venture’s Research Team (“GGV”) for general information only and is not intended to be relied upon
in any way. Golden Gate Ventures is an early stage venture capital firm based in Singapore. We are an independent company incorporated in Singapore and
are not affiliated to any other company outside of Singapore and the Cayman Islands. In particular Golden Gate Ventures is not associated in any way with
GGV Capital based in Silicon Valley, United States of America and Shanghai, China or Golden Gate Capital based in San Francisco, United States of America.
Our business takes us to various parts of the world, and there may be companies in those countries with a similar corporate name, but we are not in any way
related to them.
Information, projections and images

Information contained in this communication has been obtained from materials and sources believed to be reliable at the date of publication, however GGV
has not taken steps to verify or certify its accuracy or completeness. Opinions, projections and forecasts in this communication depend on the accuracy of
any information and assumptions on which they are based, and on prevailing market conditions, for which GGV does not accept responsibility. No
representations or warranties of any nature are given, intended or implied by GGV about this communication, any information, opinions and forecasts
contained within this communication or the accuracy or enforceability of any material referred to in this communication.
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Successful foreign investors largely possess 4 key factors:

GDP Growth rate FDI Inflows Inflation rate

GDP per Capita Benchmark Interest Rate Ease of doing business

Population Government Literacy

Ho Chi Minh City

Global Index of Digital Global Innovation Index Internet Usage

Set by rapid economic growth and

● Top sectors for FDI disbursement:

● Top Countries by Total registered capital:

1 Singapore 2 South Korea 3 Japan

- Indonesia Malaysia Philippines Singapore Thailand Vietnam

Source: Oxford Economics, OECD; BCG Research & Analysis 5

Width of arrow represents total change in 74

Plans Invests $150 Intends to

Hanoi & Hai

Capital & largest Tĩnh Benefit from more Tĩnh

Notes: MACs – Middle and affluent classes

70th Rankings of Vietnam in Ease of Doing

Dealing with construction 25 Protecting minority investors 97

Getting electricity Paying taxes 109

Registering property 64 Starting a business 115

Enforcing contracts 68 Resolving insolvency 122

Vietnam has been working on regulatory reforms and technology infrastructure to

HCMC Kuala Singapore Bangkok Shanghai

Formidable industry workforce size Favourable tax rate

Class High tech Large scale Social importance

From “High speed”... To “High quality”...

Labor intensive Talent focus

Static forces (e.g. low-cost Dynamic forces

Modern technical & social infrastructure

Forming and developing economic corridors

Source: Resolution No. 81/2023/QH15, Decision No. 569/QD-TTg, BCG analysis 13

HealthTech Asset-light Logistics Renewables

FinTech IT & DIgital services De-carbonisation services

EdTech Recycling & circular economy

Deep-dives in next pages

Growing tech-savvy population with high propensity to spend on

● Government support and preferential tax treatment to encourage

● Young, tech-savvy population of nearly 100 million people with

● A significant proportion of the unbanked population remains

● Favourable government policies and initiatives to promote digital

● Large and growing young population with a strong demand in

● Higher spending propensity on education due to deep-rooted

Digital transformation of education in Vietnam is still in its early stages. In

With Supply-Chain-as-a-Service, organizations can focus on their core

Building blocks for Asset-light models:

● Mature capital: Mature/operational onshore wind projects

Photo courtesy of Fitch Solutions Japan 6.1% 4 Taiwan 6.4%

Hong Kong 3.6% 5 United States 4.6%

Economic openness scores of East and Southeast Asian markets

⇨ Investors may not prefer startups operating in heavily government-regulated industries

Source: Press releases, World Bank 24

Uyen Nguyen Quyen Dang

Arnaud has more than 15 years of consulting

Information, projections and images

environment Vietnam's workforce is also advantageous, with competitive