“Entrepreneurship in Asian High-Tech Industries”

OPPORTUNITIES & CHALLENGES in VIET NAM

US – ASIA TECHNOLOGY MANAGEMENT CENTER STANFORD UNIVERSITY – SCHOOL OF ENGINEERING

May 6th 2008

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Scale Image of Semiconductor Market
33 trillion $US
(World GDP) 1 trillion $US
Electronic Products Electronic Devices (Semiconductor/FPD) Semiconductor/FPD Production Equipment

The World Economy

Solar Cell App, emerging

275 Billion $US
40 Billion $US

Source: Gartner Dataquest

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WW Semiconductor Capital Equipment Annual Spending from 2006 - 2009
Projection indicates most semiconductor manufacturing capacities are in Asia

North America 15%

Asia 78%

Europe 7%

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New Waves of Growth In the Semiconductor Market

, going green

Expanding from Advanced Nations to Economic Zones, Developing Nations
Source: TEL GES Company Confidential

New Wave II – Geographical Expansion
Expanding from Advanced Nations to Economy Zone, Growing Nations

Asia

Central & South America

East Europe Russia Czech Slovakia Hungary Poland Turkey Rumania etc.

Middle East, Africa Saudi Arabia Egypt South Africa Nigeria etc.

Mexico China Brazil India Viet Nam Argentine Indonesia etc. Malaysia Philippine Thailand Nam Viet etc.

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New Wave II – Geographical Expansion

Emerging Country: China, India, Viet Nam, Africa, Latin & Central America, Eastern Europe, Middle East
Source: Goldman Sachs, Nikkei Market Access GES Company Confidential

New Wave II – Geographical Expansion

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OPPORTUNITIES IN VIET NAM

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Thriving Economy

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A population of 85 million people
A huge potential electronics product consumer market

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Domestic Consumption Trends on the Rise

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Vietnam Country Profile Vietnam
• Population: 85 million
(~60% under the age of 30) 13th largest in the world

• Government: Socialist State • Literacy: 90.3% • Languages: Vietnamese (official), English (increasingly favored as second language)
Age Structure Age Structure
1 2
Thai 2%

Ethnic Breakdown Ethnic Breakdown
Others 1 2%

8

4

0 0-4 1 4 0-1 20-24 30-34 40-44 50-54 60-64 70-74 80+

Kinh (Viet) 86%

Source: CIA World Factbook, May 2007; TNS, Oct 2007; AC Nielsen, Nov 2007

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Integrated into the World Economy
• • • • • • • • 1998 Member of APEC 2001 US – VN Bilateral Trade Agreement 2003 Japan – VN Bilateral Trade Agreement 2003 Korea- VN Bilateral Trade Agreement 2006 Full Membership of WTO 2006 Full Realization of AFTA 2008 Member of UN Security Committee July 2008 VN will chair the UN Security Meeting

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Vietnam: Economic Overview
Macroeconomic Indicators:
• • • • 2006 GDP Growth: +8.2% 2006 Retail Spending Growth: +20.4% 2007 GDP Growth: +8.2% 2008 GDP Growth: 9% (est.)

Educated and Eager Labor Force:
• • • •

ACNielsen survey ranked Vietnamese as most optimistic in Asia Labor Force: 44 million Urban Unemployment: 5.5% University and college attendance rates increased 56% in 2005 over 2000

2007 GDP Growth 2007 GDP Growth
12.0% 10.5% 9.0% 8.5% 8.2%

6.0%

4.8%

4.5%

4.4% 3.4% 2.8% 2.8%

3.0%

0.0% China India Vietnam South Korea Israel Taiwan

Source: Source: World Bank, CIA Factbook, TNS, ACNielsen

United States

Japan

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European Union

Vietnam: Industry Market Analysis
Internet Usage Statistics:
• 18mm users in 2007 – Up from 13 mm users in 2006, a 38% increase – ~20% Internet Penetration For ages 15 -19: 82% (Feb. 2006) For ages 20 -24: 74% (Feb. 2006)
Internet Population and Penetration Internet Population and Penetration
50.0 100%

Mobile Usage Statistics:
•

18.2mm mobile phone users in 2007E – Up from 12.2mm users in 2005, a 49% y/y increase