Vietnam Praised for Economic Reforms

Craig Mundie, chief research and strategy officer of Microsoft Corp., makes an address at the Asia Pacific Economic Cooperation (APEC) CEO summit in Hanoi, Friday, Nov. 17, 2006. As a sideline of the annual Pacific Rim summit, business leaders discussed economic climate in the region under the theme of "Towards One Community." (AP Photo/Apichart Weerawong) (Apichart Weerawong - AP)

HANOI, Vietnam -- Top business leaders attending a Pacific Rim economic conference on Friday praised communist Vietnam for its stunning progress in reforming its economy a day after U.S. companies struck a flurry of investment deals worth more than $1.6 billion.

"Vietnam has demonstrated to the world its capacity for quantum leaps," said Craig Mundie, chief research and strategy officer for Microsoft Corp.

"It's clear that the government has recognized that broad-based reform and economic liberalization are essential to Vietnam's integration into the global economy," Mundie told more than 1,000 participants at the Asia-Pacific Economic Cooperation forum's "CEO Summit."

Hanoi's role as host to the annual APEC summit, which brings together President Bush and 20 other leaders for a weekend meeting, gives Vietnam a rare chance to showcase its transformation from a war-ravaged backwater to a fast-growing exporter.

More than 20 years of "doi moi" market-oriented reforms have made Vietnam APEC's fastest expanding economy after China, with growth racing ahead at a 7.5 percent clip.

The CEO gathering comes fresh on the heels of two of the biggest business developments to hit Vietnam in years _ its approval for membership in the World Trade Organization and Intel Corp.'s announcement last week that it will invest $1 billion in a chip plant in Ho Chi Minh City.

More deals were announced Thursday. Energy company AES Corp. signed an agreement with state-owned Vietnam Coal & Minerals Corp., or Vinacomin, to build a coal-fired power plant at a cost of $1.4 billion, Vinacomin said. Arlington, Va.-based AES will contribute 90 percent of the capital, with the Vietnamese partner providing 10 percent.

In another deal, state-owned Vietnam National Shipping Lines, or Vinalines, agreed to form a $100 million container terminal joint venture with Seattle-based SSA Marine.

And Vietnam's Truong Thinh Co. said it had sealed a US$140-million contract with California-based NRG Resources Inc.

Executives lauded Vietnam's effort to amend its laws to conform with WTO rules as it prepares to join the Geneva-based trade group next month.

"We see great growth potential in this market," said Michael Ducker, president of FedEx Express International.

Joining the WTO "represents the emergence of Vietnam towards an economy that is very competitive," said Scott Price, chief executive of DHL Express Asia-Pacific, which on Thursday said it was investing US$14 million in Vietnam through a joint venture to upgrade its facilities and vehicles in the country.