FedEx Express, one of the global largest express transportation companies, is expected to be the first foreign investor to have a wholly-owned subsidiary in Vietnam since the country entirely opened express market for foreign players early this year.
David Cunningham, president of the Asia Pacific Division of FedEx Express, in a recent meeting at the Ministry of Planning and Investment said the US-headquartered company had filed application for establishing a wholly-owned subsidiary in Vietnam.
He said FedEx expected the Vietnamese government to approve its application soon. If the application is approved, FedEx will be the first foreign express firm having 100 per cent subsidiary in Vietnam.
FedEx has been operating in Vietnam since 1994 through a partnership with domestic Scabornes and Danatrans companies. The firm is also the first international express transportation company to have it own flights into and out of Vietnam. At present, FedEx has flights linking Hanoi and Ho Chi Minh City with 19 places in Asia and North America.
Cunningham said the new investment would expand business foothold of FedEx in Vietnam to exploit the growing demand in this growing market. It also underlined long-term commitment of FedEx in Vietnam’s market.
With the increase of foreign direct investment inflow and average economic growth at around 7 per cent over the past decade, Vietnam is an attractive place for foreign ex companies. The proof for this industry’s potential, Datamonitor ResearchStore’s statistics shows that the total express market value in Vietnam is expected to have the annual growth rate of 10.9 per cent in the period of 2009 and 2014. However, the Vietnamese government has just entirely opened express market for foreign players since early this year under its commitment to the World Trade Organisation.
Still, foreign companies like FedEx Express, DHL Express, TNT Express and UPS Express have been presenting in Vietnam for a long time and they are expanding business quickly. Those four famous brands are now accounting for around 80 per cent of the market share in Vietnam.
Ngoc Linh | vir.com.vn
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