MARITIME HOW TO DO BUSINESS IN VIETNAM? Andrew Westwood 2014-03-21 1 DNV GL © 2013 2014-03-21 SAFER, SMARTER, GREENER No sense to ignore it: Corruption is an issue Hanoi: A Hanoi court has sentenced five officials in the shipping industry to jail for forging documents to gain illegal income in deals purchasing old vessels at a state shipping company. Ngo Van Nhuan, dismissed deputy chief auditor of the State Audit Region No.7, received a jail term for the same charge. Do Thi Bich Thuy, dismissed deputy director general of Bien Dong, and Nguyen Thi Le Thuy, a dismissed cashier at the company, received 30 months and 24 months suspended sentences, respectively. Meanwhile, Bui Quoc Anh, dismissed director general of Vinalines and Hoang Gia Hiep, dismissed director of Vinashin Finance Company, a subsidiary of the state-owned shipbuilding firm Vinashin, were sentenced to three years in prison. [04/03/14] 2 DNV GL © 2013 2014-03-21 Indonesia Vietnam Norway Philippine China 3 DNV GL © 2013 2014-03-21 No need to reinvent the wheel DNV GL © 2013 2014-03-21 4 There are plenty of good law firms in Vietnam as sample below shows: identify a good company …and a good man in the company 5 DNV GL © 2013 2014-03-21 6 DNV GL © 2013 2014-03-21 Economy Ease of Doing Starting a Business Rank Business Dealing with Construction Permits Getting Electricity Registering Property Getting Credit Protecting Investors Trading Across Borders Paying Taxes Enforcing Contracts Resolving Insolvency Singapore 1 3 3 6 28 3 2 5 1 12 4 Denmark 5 40 8 18 7 28 34 12 8 32 10 Norway 9 53 28 17 10 73 22 17 26 4 2 China 96 158 185 119 48 73 98 120 74 19 78 Vietnam 99 109 29 156 51 42 157 149 65 46 149 Philippines 108 170 99 33 121 86 128 131 42 114 100 Indonesia 120 175 88 121 101 86 52 137 54 147 144 Bangladesh 130 74 93 189 177 86 22 100 130 185 119 India 134 179 182 111 92 28 34 158 132 186 121 Economies are ranked on their ease of doing business, from 1 – 189. A high ranking on the ease of doing business index means the regulatory environment is more conducive to the starting and operation of a local firm. This index averages the country's percentile rankings on 10 topics, made up of a variety of indicators, giving equal weight to each topic. The rankings for all economies are benchmarked to June 2013. 7 DNV GL © 2013 2014-03-21 Vietnam’s population @ 90 million @ app 40 million < 26yrs old Economy Fixed-term contracts prohibited for permanent tasks? China No Indonesia Korea, Rep. Japan Yes No No Norway Philippines Yes Yes Vietnam No 8 DNV GL © 2013 Maximum length of a single fixed-term contract (months) Maximum length of fixedterm contracts, including renewals (months) No limit - after 10 years of work or 2 renewals of fixed-term contracts, provisions of article 14 of the PRC Labor Contract Law apply No limit 24 months extendable for another 12 months (Art. 59(4)) 24 36 No limit No limit, but after 4 years the employee is regarded as a permanent employee, and thus enjoy the same job protection (with respect to termination provisions etc) as an indefinite term employee (Sect 14-9 para 5 WEA). No limit No limit 36 - Art. 22.1 of the Labor Code 2012 2014-03-21 Minimum wage for a 19year old worker or an apprentice (US$/month) 242.4 36 24 232 727.8 1833.6 48 4,400.10 218.3 72 73.1 WHAT IS CULTURE? a complex pattern of ideas, emotions and observable behaviours and symbols … … that tend to be expected, reinforced and rewarded by and within a group DNV GL © 2013 2014-03-21 Slide 9 Culture is not simple but often a matrix Religious Regime EXPECTED Tribal Individual National REINFORCED REWARDED Organisational DNV GL © 2013 Professional 2014-03-21 10 Cultural & Ethical DILEMMA You are the passenger in a car driven by a close friend Your friend hits a pedestrian You know your friend was driving at 50km per hour in a 30 zone There are no witnesses Your friend’s lawyer says that if you testify under oath in court that your friend was only driving at 30, it might save him/her from serious consequences Would you lie in court to help your friend? DNV GL © 2013 2014-03-21 Slide 11 Percentage of respondents who said they would probably NOT lie in court 100 80 60 40 20 SWI DNV GL © 2013 GER SWE NOR NETH SPA ITA 2014-03-21 Slide 12 IND CHI RUS INDO VEN KOR DNV GL © 2013 2014-03-21 Slide 13 Individualist cultures – Often called “I” cultures – You take responsibility for your own actions – You should be able to show initiative – You should be able to work alone and independently – You should have the confidence to give your own opinion and say what is on your mind (even if you do not agree with other people) DNV GL © 2013 2014-03-21 Slide 14 INDIVIDUALISM Individualism Collectivist “We” comes first “I” comes first DNV GL © 2013 2014-03-21 Slide 15 Collectivist cultures – “We” cultures – group focus before individual focus – Relationship-focused – Will tend to go along with what the group believes/feels rather than standing alone with an individual decision or opinion – Important to maintain a sense of unity and harmony – Loyalty and duty very important – Prefers to communicate discreetly DNV GL © 2013 2014-03-21 Slide 16 POWER Equality (Small Power Distance) cultures – Power is distributed more evenly from top to bottom – Power differences are kept to a minimum – Employees expect to be consulted before important decisions are made (consensus) – People do not really adjust their communication style when speaking to people with power – Powerful people try to appear less powerful than they are DNV GL © 2013 2014-03-21 Slide 17 POWER Hierarchy (Large Power Distance) cultures – Power is distributed unevenly (people at the top have much more power than people at the bottom) – Less powerful people dependent on the more powerful – Subordinates expect direction and guidance – The ideal boss is a “good father” (able to combine power with kindness) – Communication style is formal – Management style tends to be top-down DNV GL © 2013 2014-03-21 Slide 18 HIERARCHY NOR DNV GL © 2013 USA UK GER 2014-03-21 Slide 19 ITA FRA JAP Percentage of respondents that feel that it is important for a boss to act and look like a boss DNV GL © 2013 2014-03-21 Slide 20 Hierarchy people who agree that when you ask a manager a question, the manager should know the precise answer DNV GL © 2013 2014-03-21 Slide 21 Talk most of the time Talk half of the time DNV GL © 2013 Listen most of the time 2014-03-21 Slide 22 Display feelings Hide feelings Tend to hide feelings DNV GL © 2013 2014-03-21 Slide 23 People-oriented People-oriented Task/Job-oriented DNV GL © 2013 2014-03-21 Slide 24 Wants to create a good impression with you as well as provide you with information Speaks to be clear and provide factual information DNV GL © 2013 2014-03-21 Slide 25 Wants to mostly create a nice atmosphere Is flexible with the truth depending on who is hearing “the truth” Will avoid telling you the truth if it is not very nice Tries to tell you the truth even if the truth is not very nice to hear DNV GL © 2013 2014-03-21 Slide 26 HATES being wrong and will often provide excuses and reasons to defend his “mistake” Will never embarrass you in public even if he knows he is right and you are wrong Doesn’t like being wrong but will accept your argument if you have solid proof (facts) DNV GL © 2013 2014-03-21 Slide 27 Confronts emotionally and personally Avoids confrontation Confronts with logic & reason DNV GL © 2013 2014-03-21 Slide 28 Has good intentions – even if unable to deliver the promise Cautious about making promises but, since this person likes to be helpful too, will often say yes to keep a nice atmosphere Cautious about making promises DNV GL © 2013 2014-03-21 Slide 29 DNV GL © 2013 2014-03-21 Slide 30 MODEL CREATED BY RICHARD LEWIS Venezuela Algeria Italy Greece Angola Saudi Arabia Portugal Russia Iran Turkey France BELGIUM INDIA Australia Netherlands Indonesia Philippines Denmark Korea USA China Switzerland UK DNV GL © 2013 Germany Sweden Finland CANADA Norway 2014-03-21 Slide 31 Singapore Hong Kong Japan Vietnam ASIA Philippines Korea China Hong Kong Vietnam Singapore Japan DNV GL © 2013 2014-03-21 Slide 32 NORWAY NARVIK TRONDHEIM BERGEN STAVANGER OSLO LILLEHAMMER DNV GL © 2013 2014-03-21 Slide 33 KRISTIANSAND Just doing business or risky business? DNV GL © 2013 2014-03-21 Slide 34 35 DNV GL © 2013 2014-03-21 Thank you for your attention “Sometimes you have to do what is necessary” Winston Churchill 36 DNV GL © 2013 2014-03-21 SAFER, SMARTER, GREENER Andrew Westwood – Senior Vice President, DNV GL [email protected] Regional Office South East Asia and Pacific www.dnvgl.com SAFER, SMARTER, GREENER 37 DNV GL © 2013 2014-03-21