News / Economy

Anti-China Riots Shake Vietnam’s Investment Prospects

FILE - Stacks of 100,000 Vietnamese Dong notes ($4.70) are pictured as employees count money at a branch of the Bank for Investment and Development of Vietnam (BIDV) in Hanoi, Jan. 20, 2014.
FILE - Stacks of 100,000 Vietnamese Dong notes ($4.70) are pictured as employees count money at a branch of the Bank for Investment and Development of Vietnam (BIDV) in Hanoi, Jan. 20, 2014.
Marianne Brown
In Vietnam, businesses affected by last week’s deadly anti-China riots are beginning to piece their operations back together. But questions remain over whether any permanent damage has been done to the country’s investment prospects over the protests that got out of control.

Vietnam is still reeling from riots which erupted in industrial parks on the outskirts of Ho Chi Minh City and later in central province Ha Tinh, where two Chinese workers were killed and over 100 wounded.
 
FILE - Firefighters rest near a damaged Chinese owned shoe factory in Vietnam's southern Binh Duong province, May 14, 2014.FILE - Firefighters rest near a damaged Chinese owned shoe factory in Vietnam's southern Binh Duong province, May 14, 2014.
x
FILE - Firefighters rest near a damaged Chinese owned shoe factory in Vietnam's southern Binh Duong province, May 14, 2014.
FILE - Firefighters rest near a damaged Chinese owned shoe factory in Vietnam's southern Binh Duong province, May 14, 2014.
The riots broke out following heightened tensions over a Chinese oil rig deployed between Vietnam and the Paracel islands - which both countries claim.

Jerry Shum, investor relations director at Yue Yuen Industrial Holdings Ltd, a sports shoe manufacture which supplies Nike Inc. and Adidas AG, said operations in South Vietnam were now running normally.

“We have confidence, given what we have heard from our sources, that the Vietnamese government will restore law and order soon,” he said in an emailed comment to VOA.

He said the company took precautions last week and did not experience any damage or violence, adding: “We are still committed to operate in Vietnam and see it as an important part of our operations.”

Return to normal will take time

It will take time before things are back to normal, says Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi, and the business community is encouraging the government to help in a fair and transparent way.

“Talking to Taiwanese and Koreans and others, the big issues now are how to handle the logistics of getting things back to normal. That involves some of the technical stuff like wage payments, social and health insurance and stuff. In the time period when things weren’t working because things were shut down, who pays for that?” he said.
 
Protesters chant slogans during an anti-China protest in front of the Chinese embassy in Hanoi, Vietnam, May 13, 2014.Protesters chant slogans during an anti-China protest in front of the Chinese embassy in Hanoi, Vietnam, May 13, 2014.
x
Protesters chant slogans during an anti-China protest in front of the Chinese embassy in Hanoi, Vietnam, May 13, 2014.
Protesters chant slogans during an anti-China protest in front of the Chinese embassy in Hanoi, Vietnam, May 13, 2014.
Sitkoff says although the riots have temporarily shaken investor confidence, they will not affect Vietnam’s long-term investment prospects.

This is partly because the government has made it very clear that this will not happen again, Sitkoff says.

“It’s done a very effective job of reaching out to key stakeholders and making sure that people understand that their priority is to continue calm and stability here and to let foreign investors know that the attributes that make Vietnam an attractive destination for investment are still going to continue here and that people don’t need to worry,” he said.

At a news conference on Saturday, Do Nhat Hoang, director of Vietnam’s Bureau for Management of Foreign Investment under the Ministry of Planning and Investment, said Taiwanese companies had been mistaken for Chinese.

Wait-and-see

Hoang said Vietnamese authorities are taking appropriate measures to assist investors in restarting production.

However, not everyone is so confident.

Economist Vuong Quan Hoang, co-author of What We See, Why We Worry, Why We Hope: Vietnam Going Forward says he believes investors will keep a “wait-and-see attitude” for some time.

He said part of the problem is that the government’s decision-making process on this issue is not clear from the outside, and analysts are left to speculate.

“I don’t know whether such a political will be able to make things happen the way politicians and leaders want," said Hoang. "Apparently they didn’t want to see the riots and the kind of effect we’ve been seeing over the past week. Nobody wanted that.”

The crisis could also lead to changes within the country. Some observers have said anti-China protests sparked riots among factory workers because of grievances over poor working and living conditions.

Need for reforms

Hoang said it is good that this issue has been raised.

“Now they also raise [the] issue about the roles of trade unions in those factories. I know that the issue is not easy to solve, but at least big brains in society will have to sit down and agree that these are things we have to discuss," he said.

Sitkoff says the current environment is a good opportunity for Vietnam to make itself even more attractive to foreign business and undertake some of the reforms that have been necessary for a long time to make the country more competitive.

The Vietnamese government feels bad, he says, and it wants people to come back.

Factories Torched in Anti-China Protests in Vietnam
 
  • Protesters targeted an industrial area in Binh Duong. The crowd set everything on fire, from materials, computers, equipments to other machines.
  • Protesters set truck on fire during a protest against China in the southern province of Binh Duong.
  • Protesters gathered at Amata Industrial Park, Bien Hoa City, Dong Nai Province, Vietnam.
  • Protesters gathered at Amata Industrial Park, Bien Hoa City, Dong Nai Province, Vietnam.
  • A foreign company displays banner supporting Vietnam in Dong Nai.
  • A factory in Binh Duong was set on fire. Banner says “We love Vietnam. Please protect our rice bowl."
  • A factory in Binh Duong was set on fire. Banner says “We love Vietnam. Please protect our rice bowl."
  • Protesters gathered at Amata Industrial Park, Bien Hoa City, Dong Nai Province, Vietnam.
  • Protesters gathered at Amata Industrial Park, Bien Hoa City, Dong Nai Province, Vietnam.
  • A banner says “Our company is not a Chinese company” in Binh Duong.

You May Like

Afghan Refugees Complain of Harassment in Pakistan

Afghan officials and human rights organizations assert that Pakistani authorities are using deadly attack at school in Peshawar as pretext to push out Afghan refugees More

At Boston Bombing Hearing, Sides Spar Over Boat

At final pre-trial hearing, lawyers for suspect Dzhokhar Tsarnaev, prosecutors disagree on whether vessel where he hid from police can be shown to jurors More

Iran Judiciary 'Picks' Lawyer for Detained WP Reporter

Masoud Shafii has been attempting to secure official recognition as Rezaian’s attorney, but is not allowed to see his client in prison More

This forum has been closed.
Comment Sorting
Comments
     
by: We just fade away
May 20, 2014 5:57 PM
When the oil rig is moved away in August as scheduled, there will be no real winner but both sides will declare victory and things will calm down until ???

by: We just fade away
May 20, 2014 5:42 PM
What riots? -There will not be any riot because the government says so.
A shooting war between Vietnam and China is unlikely to break out. Labor costs are rising in China, more and more investors are considering moving their operations out of China to somewhere else, and Vietnam will be getting a good portion of that and that means more jobs for the people and exports growth for the country.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Supreme Court Hears Hijab Discrimination Casei
X
Katherine Gypson
February 25, 2015 11:30 PM
The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video US Supreme Court Hears Hijab Discrimination Case

The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video Falling Gas Prices Hurt Nascent Illinois Hydraulic Fracturing Industry

Falling oil prices are helping consumers purchase cheaper petroleum at the pump. But that’s made hydraulic fracturing or “fracking” less economically viable for the companies in the United States invested in the process. VOA’s Kane Farabaugh reports on one Midwestern town that was hoping to change its fortunes by cashing in on the next big U.S. oil boom.
Video

Video Fighting in Sudan's South Kordofan Fuels Mass Displacement

Heavy fighting in Sudan's South Kordofan state is causing hundreds of thousands to flee into uncertain conditions. Local aid organizations estimate as many as 400,000 civilians have been internally displaced since the conflict began more than three years ago, while another 250,000 have fled across the border to refugee camps in South Sudan. VOA's Adam Bailes reports.
Video

Video Lao Dam Project Runs Into Opposition

A Lao dam project on a section of the Mekong River is drawing opposition from local fishermen, international environmental groups and neighboring countries. VOA's Say Mony visited the region to investigate the concerns. Colin Lovett narrates.
Video

Video A Filmmaker Discovers Her Biracial Identity in "Little White Lie

Lacey Schwartz grew up in an upper middle-class Jewish family, in a town in upstate New York where almost everyone she knew was white. She assumed that she was, as well. Her recent documentary, Little White Lie, tells the story of how she uncovered the secret of her true racial background. VOA’s Carolyn Weaver has more on the film.
Video

Video Deep Under Antarctic Ice Sheet, Life!

With the end of summer in the Southern hemisphere, the Antarctic research season is over. Scientists from Northern Illinois University are back in their laboratory after a 3-month expedition on the Ross Ice Shelf, the world’s largest floating ice sheet. As VOA’s Rosanne Skirble reports, they hope to find clues to explain the dynamics of the rapidly melting ice and its impact on sea level rise.
Video

Video US-Cuba Normalization Talks Resume Friday

Negotiations aimed at normalizing diplomatic relations between the U.S. and Cuba resume Friday. On the table: lifting a half-century trade embargo and easing banking and travel restrictions. There's opposition in Congress, but some analysts say there may be sufficient political and economic incentives in both nations for a potential breakthrough this year. VOA's Mil Arcega reports.
Video

Video Pakistan's Deadline For SIM Registration Has Cellphone Users Scrambling

Pakistani cell phone users have until midnight Thursday to register their SIM cards, or their service will be cut off. While some privacy experts worry about government intrusion, many Pakistanis are just worried about keeping their phone lines open. VOA Deewa reporter Arshad Muhmand has more from Peshawar.
Video

Video Myanmar Warns Factory Workers to End Strikes

Outside Myanmar's main city Yangon, thousands of workers walked off their jobs earlier this month demanding a doubling of their wages, pay raises after a year and input from labor unions on industrial regulations. Since Friday, the standoff has grown more tense as police moved in to disrupt the sit-ins, resulting in clashes that injured people from both sides. VOA correspondent Steve Herman visited industrial zones which have become a focus of Myanmar's fledgling workers rights movement.
Video

Video Oscar Winners Do More Than Thank the Academy

The Academy Awards presentation is Hollywood’s night to reward the best movies from the previous year. It’s typically a lot of glitter, a lot of thank you’s, a lot of speeches. But many of this year’s speeches carried messages beyond the thank you's. VOA’s Carolyn Presutti takes a look.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

World Currencies

EUR
USD
0.8896
JPY
USD
119.26
GBP
USD
0.6475
CAD
USD
1.2451
INR
USD
61.816

Rates may not be current.