I try not to let my personal life interfere with this blog too much, though I do on occasion tell personal stories. I’m currently sitting in Laos Plaza Hotel in Vientiane, Laos, and wondering at the difference between Vietnam and Laos. While there is indeed some new construction here in Vientiane, it is nothing like what I see in Vietnam. There could hardly be a bigger difference.
Laos is a small country with only about six million inhabitants, compared to Vietnam’s 97 million. Ho Chi Minh City, where I live, has over 10 million people alone. That’s a sizable difference and it can tell in the amount of foreign money pouring in.
While FDI in HCMC surpasses several billion a year, that’s probably all that Laos gets, and that’s definitely not all that Vietnam gets. There’s a difference in work force, in location, in geography, it’s all different. Though last I checked Laos had a 30 day a year sick leave policy for workers, which is quite nice compared to the limited sick leave allowed in Vietnam. But that is also something that attests to Vietnam’s productivity. Workers work hard in Vietnam, and they spend their time in the office, in the paddy, on the farm. It’s part of what makes Vietnam what it is, it’s resolution and resilience, learned from thousands of years of fighting invaders.
Infrastructure, too, is a major boon. Vietnam lies on the coast, and has access to shipping and rail and roads. Laos is landlocked, and must transship everything through either Thailand or Vietnam, and this is expensive, making manufacturing in Laos impractical for supply chain purposes. Though the infrastructure is improving with the Chinese Belt and Road program building a railroad and a highway through the country to connect Laos with China and Thailand in a more efficient, more nexus oriented, way.
Laos is Vietnam’s little sister in politics, following much the same path, though it also has failed to modernize to the same extent that Vietnam has. It’s a dichotomy, a juxtaposition of two extremes. One is poverty, in Laos where the socialism of Kaisone Phomvihane and the Party became overwhelming to the needs of reality and what would eventually become economic liberalization.
So Vietnam is in a good position, when you look around it, and it’s a place to invest your money. It has many advantages. Certainly, it’s not Singapore, but it’s getting to the point where it can compete. Infrastructure, workforce, geography, all of these are in Vietnam’s favor. Rather be there than in Laos, at least for investment purposes, anytime.