Facing Vietnam : -Which are the main reasons that there are not more Scandinavian companies established in Vietnam

Abstract: Since the beginning of 1990, Vietnam has had one of the fastest growing economies in the world. This economic growth is attracting foreign investors to the country. In spite of positive economic figures, the amount of Scandinavian companies established in Vietnam is low. The purpose of this thesis is to identify some risk factors as well as opportunities in the surroundings of Scandinavian companies operating in Vietnam. This will be carried out from a national point of view. The objective is to be able to inquire if Vietnam is an attractive country for Scandinavian companies. Furthermore, we wish to contribute with valuable information for Scandinavian companies that consider establishing their business within the country. With help from Ehrengren’s BERA model and Miller’s Framework we have investigated different areas in the companies’ surroundings. These areas are for example: political, infrastructure, government and clients. By studying them, it is possible to see how the different areas are affecting the companies. Above this, we have used a specific culture definition as well as an article, touching the same field, to further illuminate the subject. The thesis is a case-study with a qualitative approach. Methodologically our work is based upon 18 open personal interviews with different people in managing positions working for Scandinavian companies in Vietnam. The interviews were conducted during a five weeks stay in Vietnam in November and December 2005. There are many reasons why there are not more Scandinavian companies established in Vietnam. In this thesis we have come to the conclusion that the two major difficulties seem to be the widely spread corruption and the lack of infrastructure. Above this we have identified other factors that have or have had a negative impact on companies’ decisions on starting up businesses in Vietnam. Among those factors can be mentioned: shortcomings in the law, lack of national financing and different prerequisites for different companies. The country is not well adapted to its current needs, still tilting between being a market driven economy and a socialistic centrally planned economy. However, the situation for the time being might be attractive for some companies, depending on size and industry. There are different scenarios for Vietnam in the future, where the WTO-membership, China and India, the political stability and more open policies will play a decisive role.