Why is it difficult for Vietnam to replace Chinese manufacturing?

I have always been curious about Vietnam. I often see opportunities about Vietnam’s stock market. From 2011 to 2017, Ho Chi Minh Index rose 177.49% for 6 consecutive consecutive days. In 2017, the increase was as high as 55.29%. Some friends recommended investing in Vietnam stock market, but they could only give up if they didn’t understand.

This trip to Vietnam also brings with it the question of whether Vietnam was China at the beginning of the reform and opening up 30 years ago. After the trade conflict, will Vietnamese manufacturing replace Chinese manufacturing?

Those who hold such remarks are nothing more than Vietnam’s huge and cheap demographic dividend.

The average age of Vietnamese population is about 25 years old, while the average age of Chinese population is over 35 years old. Judging from the proportion of the working population ( 15 – 64 years old ), Vietnam’s working population accounts for about 70.0%, similar to China’s in 2003, with a dependency ratio of about 42%.

All economic problems can be regarded as population problems. Before going, I began to accept that Vietnam may be the next China. But after a few days of feeling, I found that this may not be the case.

First, the economic level. 10,000 Vietnamese dong is about 2.88 yuan. Vietnam’s banknotes are of very large denominations and are not used to them. Later, I came up with a solution. When the average waiter said 50,000 or 100,000 Vietnamese dong, the psychological default was to take the previous figure and multiply it by 3, that is, its 50,000 Vietnamese dong is probably less than 15 yuan.

Wages and prices there are very low. On the day of arrival, I took a taxi from the airport to the hotel. At the check – out, the driver said whether it was 200,000 or more and gave a 500,000 directly. The driver showed a surprised expression on his face, and then rummaged through his wallet for a long time before finding enough change.

One day at noon in Ho Chi Minh City, I hit a Grab ( in Vietnam ), the driver of which could not speak English. I said he didn’t understand, neither did I. In the end, it took more than 20 minutes for both of us to sweat profusely. Only then did we know that he wanted to charge an extra 5,000 Vietnamese dong ( about 1.45 RMB ). I readily agreed.

In the shopping center of Ho Chi Minh City, I ate a special local meal. This place should be similar to Tianhe City, with a total cost of 454,000 ( about RMB130 ). A cup of coffee is about 30,000 Vietnamese dong.

Prices in supermarkets in the city center can be seen at about 27,000 yuan ( RMB8 ) for the following two space peppers, 40,500 yuan ( RMB12 ) for the following ribs, and 18,000 yuan ( RMB5.4 ) for vegetables in the middle.

The house price is not clear, but after checking online, ho chi Minh city’s house price is over 10,000 RMB per square meter, and the capital Hanoi’s house price is as high as 40,000 RMB per square meter.

Considering the little brother of Mo, he and I made a 20 – minute move to increase the price of 1.5 yuan, judging from this that their salary should not be high and it is difficult to supply the house price. This is similar to the situation in China, where housing prices are always determined by those with the strongest purchasing power.

Besides infrastructure construction, this is one reason why I think Vietnam cannot replace China in the short term. When we went to the security check, the security check place was very shabby and the staff efficiency was very low. It took about 5 minutes for one person to pass the security check. When I returned to Guangzhou, all of them were fingerprint recognition + face recognition, and all of them passed the customs automatically. I felt very deeply at that time. The most common traffic in the city is motorcycles.

Let’s look at the lower left corner of the picture. The road is a bit rotten. This is the road condition in the center of Ho Chi Minh City. Ho Chi Minh City is the largest city in Vietnam. The road is worse than our fourth and fifth line cities.

It is conceivable that the road conditions in other places are exactly the same. From Ho Chi Minh to the China – Pakistan bus in Dalat, the road is called sour and refreshing. There were about 10 people in the same car, of which 4 Vietnamese elder sisters got sick and vomited directly.

We went to three cities, Ho Chi Minh, Dalat and Nha Trang. The latter two are tourist cities. Dalat was colonized by France before, leaving behind many colonial buildings, which are very beautiful.

Generally, only paper money can be used. Credit cards can be used in some places in Ho Chi Minh. As for mobile payment, that is a fable. Vietnam is also unlikely to develop express delivery, e-commerce and mobile internet economy.

Other banks, I feel very good to find. For communication, the local telecom operator was used, but after leaving Ho Chi Minh City, the signal became much worse. No attention should be paid to the 4G signal.

Therefore, after visiting Vietnam, I began to understand what Ma Yun said. China’s investment in infrastructure is also unique. Over the past few decades, China’s investment in social infrastructure construction is probably the largest in the world combined, which is certainly much larger than that of Europe and the United States combined. Whether it is the connection between high-speed rail, expressways, airports, provinces and cities, the perfect, perfect and advanced infrastructure construction is the envy of the world.

Infrastructure needs raw materials such as steel and cement. China’s production capacity now exceeds half of the world’s. China’s infrastructure is getting better and better, and its production capacity is getting stronger and stronger. In contrast, the infrastructure of some European and American countries, especially the commercial infrastructure, is already quite different from that of China. However, China is still far from the West in terms of infrastructure management and operation.

Finally, talk about people’s mental outlook. The service personnel contacted there are generally very good in English, probably because there are many tourists there. Some waiters can also speak some Chinese.

There are all kinds of motorcycles in the streets of the city. They flow endlessly and are very energetic. I also rented a motorcycle to go to the village, but there were few people and no economic activities. In the case of industry, I did not see any factories, probably the places I went to were mainly tourist areas. But overall there is no prosperity as imagined.

By the way, I also saw Chinese manufacturers over there, including Huawei, OV, tremolo, etc.

On my way back, I thought Vietnam could not become China. Another reason was that there were too few people.

Vietnam has a population of 92.7 million and Jiangsu’s current resident population is 80.29 million, which is more than 10 million more than Jiangsu. Therefore, the ideal situation for Vietnam’s development is that it may become Jiangsu instead of replacing China.

Those low-end manufacturing industries, such as socks, shoes and toys, had no problem in the past. However, the current high-end manufacturing industry does not compete with manpower. For example, BOE’s panel production line requires dust-free workshops to be operated automatically by mechanical arms.

Another example is Gree’s and Midea’s air-conditioning production. Basically, machines have changed. China’s future direction is unmanned factories and industry 4.0.

The above is what I saw and heard in the course of my hurried trip for several days. It is hard to avoid seeing only skin and fur on a cursory tour.