HCMC BUSINESS LEADERS: UP THROUGH HARD WORK AND NEW IDEAS

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 000010 SIPDIS SENSITIVE SIPDIS STATE FOR EAP/MLS, EEB/TPP/BTA/ANA STATE PASS TO USTR DBISBEE TREASURY FOR SCHUN COMMERCE FOR HHPHO USAID/ANE E.O. 12958: N/A TAGS: ECON PGOV EFIN ETRD BEXP VM SUBJECT: HCMC BUSINESS LEADERS: UP THROUGH HARD WORK AND NEW IDEAS REF: HO CHI MINH CITY 1281 HO CHI MIN 00000010 001.2 OF 002 ¶1. (SBU) SUMMARY: Vietnam is increasingly a land of opportunity for those with business skill and determination. Over the last decade, enterprising HCMC businesspeople like Dang Thanh Tam and Le Thi Phuong Thuy have risen from obscurity to positions of national influence. They succeeded by championing ideas new to Vietnam like collateralized financing and intellectual property rights and the timing of their ascent aligns their interests closely with the multinational companies they now partner with. As the product of Vietnam's process of economic reform, these emerging business leaders are articulate and often forceful advocates for more change, particularly increased transparency and a more level playing field. End summary. ¶2. (SBU) This is the second in a series of cables analyzing the role of HCMC's business community in shaping Vietnam's policies. We assessed the politically-connected and will next examine those who were associated with the old regime but have overcome that stigma to make money and gain influence. Self-Made Business Leaders -------------- ¶3. (SBU) Unlike the politically-connected described reftel, the "self-made businessmen" tend to be younger, generally were not involved in the war, have more formal education and have lifted themselves up to build strong companies without connections to government officials. ¶4. (SBU) In little over ten years, Dang Thanh Tam has risen from obscurity to become one of the richest and most influential men in Vietnam. Vietnam's "King of Industrial Parks," Tam owns more than 17 across the country and sees the current property boom as an opportunity to expand into residential areas, tourism, financial services, energy and telecommunication. Tam rose to prominence in the business community after setting up Tan Tao Industrial Park in 1997. Realizing that local companies did not have sufficient capital, Tam convinced the local government to issue land use rights certificates for tenants in his park that could be used as collateral for bank loans. HCMC approved the proposal, Tan Tao piloted this program (later adopted as a national policy) and Tam soon had enough capital to begin buying new properties for new industrial zones. ¶5. (SBU) As his businesses grew, Tam held increasingly senior positions in associations that provided platforms to express his opinions and influence policies. As a member of the HCMC People's Council, Tam is now a vocal advocate for business interests and publicly attacks bad policies. Tam took on HCMC's inefficient tax system, criticizing the spending of VND $80 million to collect just VND $100 million tax on farm income each year; the tax was later removed. Tam is the only private entrepreneur invited to sit in a 12-advisor board of the Government's WTO Action Plan which evaluates each province implementation of Vietnam's WTO accession commitments. ¶6. (SBU) While Tam did not start with political connections, thanks to his success and wealth he certainly enjoys political influence today. Tam claims close ties with ten out of 14 Politburo members, including Prime Minister Dung and President Triet, through which he can give inputs and comments on many issues. Soon after he was elected Prime Minister, Tam says he urged a skeptical Nguyen Tan Dung to visit Japan. The trip resulted in large contracts, including Cannon, and after the trip Tam was appointed Chairman of Vietnam-Japan Business Association. Unlike many business leaders, Tam is not camera shy. Tam believes that talking with the media is one of the most effective ways for him to express opinions and make both critical and constructive comments. Pioneering New Ground -------------- ¶7. (SBU) In 2005, Le Thi Phuong Thuy stepped away from her successful company producing stainless steel water tanks and kitchen fixtures for export to become a media pioneer in Vietnam. She pulled together a US$20 million investment to set up Tri Viet Media Corporation (TVM) and in October 2005 opened Dream Field Studio to produce television programs for domestic and foreign television stations. TVM licenses and distributes foreign content from major media companies from the United States, Japan, South Korea and China. Thuy was also instrumental in establishing in 1994 the Young Entrepreneurs' Association (YEA) of HCMC, one of the largest business associations in Vietnam; she is currently Vice President. HO CHI MIN 00000010 002.2 OF 002 ¶8. (SBU) Thuy consistently uses TVM and the Young Entrepreneurs' Association as platforms to make policy proposals to the government and her fingerprints can be found on Vietnam's publication laws, enterprise laws and competition laws. As a producer of local media content, Thuy has been a vocal proponent of IPR and has helped create an environment where HCMC television stations are stakeholders in protecting content. In contrast to other provinces, media contacts now tell us that signal piracy is not tolerated in HCMC. As the association Vice-President's, Thuy voices members concerns on issues such as corporate income tax, customs issues, land issues and points discrepancies between the law on paper and the reality of implementation. Comment: -------------- ¶9. (SBU) Vietnam's fast growing economy is increasing opportunities for those who work hard and want to make a better life. The greatest opportunities may be available for those previously hampered by lack of political connection. As business associations like the Young Entrepreneurs' Association grow and become more influential, business people's concerns and recommendations to regulators and policy makers are better represented. Interestingly, both Tam and Thuy believe that Vietnam's media is as becoming an effective means for business people to raise concerns and gain influence. Their stories are a testament to the ability of individuals to rise far and fast in Vietnam while retaining perspective on the country's shortcomings still to be overcome. End comment. ¶10. (U) This cable was coordinated with Embassy Hanoi. FAIRFAX