We learned a lot today. We started the day by going to VinaCapital. VinaCapital is an investment firm in Saigon that supports and takes advantage and supports the country’s intense economic growth in very interesting ways. We learned that the company manages a total of 1.8 billion US dollars. One of their funds, which they are now winding down, is based on the infrastructure of the country. These projects would make sense since the country is constantly trying to improve its structure, especially because of the constant increase in population and the incredible traffic jams that the city experiences. This fund, however, turned out to not be sustainable. The professionals we talked to gave the reason that infrastructure is way too long-term when thinking of when you’re going to actually make money on the investment. The company is also in a very interesting situation when it comes to deciding what to invest in. Many companies within the country are still partially or totally held by the government. In the case of these companies, VinaCapital would not be able to invest in them as easily as something more liquid. With this said, VinaCapital uses liquidity as a measuring point for how easily it can invest in company or industry. Overall, government regulation can be extremely inefficient, especially economically. From what the professionals said, the government would gladly exchange efficient economic growth for a stable social situation. The government’s mindset is that faster growth requires a more free market economy. With more growth comes a widening gap between the rich and the poor. A large income gap leads to social unrest. Because of this mindset, the company believes freer, more liquid companies are better potential investments.
After the company visit, we had our Vietnamese language and culture classes. We learned numbers and how to buy things today. This will be useful tomorrow when we go to the market. Our culture class was very fast paced and interesting. We talked a little about the religions in Vietnam, which we’ll learn more about tomorrow. We also learned about modern Vietnam and its relationship to the rest of the world. Although today’s company visit was a little more complicated than the others, it was still extremely interesting and very important to understanding Vietnam as a whole.
Thank you for reading,