As a first-time visitor to Ho Chi Minh City, I was impressed by the city’s relative affluence. The supermarkets have a variety of consumer products and an array of fresh fruit and vegetables, and meat. The massive opera center, main Catholic church, and delicate terraces on the apartment buildings display the city’s French heritage. The river that courses through downtown is a potential asset. High-end residential complexes are being built with docks for luxury boats. Some day the city could resemble Singapore. Motorcycles are the favorite mode of transport. Swarms of bikes imperiled this New York pedestrian, accustomed to crossing the street against the light.

Viet Nam, a world leader in pepper, rice, coffee, and tea production, is an agricultural power house. Seventy percent of its population lives in rural areas. A Vietnamese entrepreneur is trying to build a global tea brand. Multinationals in apparel, footwear, and technology are moving factories into the country. One local entrepreneur has launched a deodorant brand, X-man, which is number two in the market.

There is relatively high internet penetration (30 percent of the population) and near universal use of the mobile phone. But in a country of 90 million, the leading newspaper has a circulation of only 450,000. VTV, the government-owned TV station, dominates the airwaves, with nine separate channels showing news, sports, and entertainment. Social media is vibrant; Zing, a local company, competes effectively with Facebook. We just opened AVC-Edelman in Ho Chi Minh City, with a superb leader in Ngoc Anh. He’s typical of the professional in his late 30s determined to be successful in business.

I had a fascinating tour of the Cu Chi tunnels, just outside of Saigon, which were built by the Viet Cong during the 1960s. Workers dug two hundred kilometers of subterranean concourses on three different levels, using small hand picks and straw baskets to dispose of the earth. Since the war with the United States, the tunnels have been widened to accommodate 1,000 daily visitors. I am not a big person, but could barely squeeze through certain sections. I crawled on my stomach, dripping with sweat and warding off claustrophobia. Imagine the will of the tunnels’ inhabitants, fifty years ago, as they dodged bombs and napalm and lived for days and weeks under the surface. My guide was proud of the booby traps made of bamboo spikes, which were used to impale unsuspecting GIs. I felt ambivalent as I departed for the boat ride home—to the strains of a machine gun firing from the rifle range on the premises—imagining myself as an American soldier on patrol.

China

I was in Beijing for the second time in four months to celebrate the tenth anniversary of our subsidiary, Pegasus, led by the inimitable Steven Cao, whose clients include BMW and Unilever. I was able to introduce Cindy Tian, who joined Edelman as vice chair of public affairs for Asia Pacific after a distinguished career in government and as head of Burson China. Perhaps, most important, I threw a 21st birthday party for my middle child, Tory, who is spending the second semester at Minzu University.

I heard a great deal of unhappiness about state owned enterprises, such as China Mobile. SEOs are taking far too much of the available investment capital and applying it to areas outside of the country’s core competencies, for example, real estate (the latter fueling real estate inflation). When I asked why China did not crack down on smoking, I was informed that most of the cigarette production is done by local companies, many of which are owned by provincial governments.

I had an entertaining meeting with Mr. Feng, founder and chairman of Aigo, a Chinese electronics company. He is helping some of the best privately owned Chinese companies in fields as diverse as fruit juice and air conditioners go global at a time when the business strategy for many Chinese manufacturers is to be the white goods producer for American or European brands. Feng wants to facilitate the creation of Brand China, enabling these companies to sell direct to consumers. He gave me an energetic demonstration of his own product’s quality. He took my picture with an Aigo camera, then tossed the unit high in the air, allowing it to crash on the floor. Then he took a bowl of water and dunked the camera into it several times. The camera still worked.

Digital media is taking off in the B to B sector. We run a program for Volvo, which sells heavy equipment for construction. We have put together a community of 300,000 machine operators on Weibo who happily share their daily experiences. The Wall Street Journal in Mandarin now has nearly 4 million monthly unique visitors; with this circulation, an advertising-supported media is possible.

The environment continues to be a hot topic. Several executives voiced serious concern about food safety—not just melamine in milk, but steroids in beef and poultry. The air quality in major cities continues to deteriorate. Under pressure from bloggers, the number of “blue sky days” is being reported more honestly. A monitor at the US Embassy in Beijing gives daily readings. The question remains: Must the rapid economic growth necessary to accommodate the ongoing emigration to cities cause continued environmental degradation? China is the world’s number one test case in finding out the true potential of green technology, from solar to electric vehicles.

I went to the National Museum on Tiananmen Square, a huge complex devoted to the history of the Chinese people. The most dramatic room is filled with paintings of the path to revolution, from the initial uprising in Shanghai in 1927 to the conquest of the Nationalists in 1949. Chairman Mao is depicted in various heroic poses, from the Long March to the visits to collective farms in the 1950s. A heartrending section is devoted to the Opium War and subsequent subjugation of China by the “imperialist powers,” through to the horrific occupation of Manchuria and northern China by the Japanese in WWII. (The rape of Nanjing is stomach-turning.) The stunning bronze cookware and pottery from over 3,000 years ago is testament to the advanced state of the country at a time when the West was in “survival agriculture” mode.

I return tired but profoundly impressed by the energy and positive spirit of these three nations. There are difficult questions to be resolved, from the role of government in business to the priority given to environment, to the growing divide between the rich and the poor. But, for now, the consensus is that prosperity is job number one.

Posted by Edelman at March 5, 2012 8:23 AM |

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