Author: Fred Hoyt

Let me combine two thoughts for my last blog entry. One involves the new “Tet Offensive.” In 1968, the Viet Cong mounted the “Tet Offensive.” Set to coincide with the Lunar New Year (“Tet”), the 1968 version assaulted the major U.S. bases, including the U.S. embassy, which was occupied in the middle of Saigon. Amid U.S. claims that we were “winning the war,” the Tet offensive caused a rethinking of the support in the U.S. for continuing the war, and ultimately led to our stating, “We won,” going home, and in 1975 watching the North Vietnamese tanks breach the Presidential Palace (now known as the reunification palace).

Today’s “New Tet Offensive” is mounted by marketers on an increasingly wealthy population. 35% of the urban population is thought to be “middle class,” officially making the $350 a month that is classified as the entrance into the middle class level. The Tet holiday, about to start, is a 10-day (or two-week) celebration of the Lunar New Year. Children return home to spend time with family, the nucleus of a Confucian society. You may remember last year a massive snowstorm crippled China during Tet and left millions stranded. Gifting is important.

Here, where the poverty level is officially 13%, down from some 40% a decade earlier, people are preparing for Tet. The stores are decorated, as are homes. Most pronounced here are kumquat trees, with an orange/tangerine-sized fruit. The airlines have put on 30 extra flights, the trains have added, etc. One important (recent) addition is the return of the overseas Vietnamese. Once denounced as traitors, the Viet Kieh are now welcomed as part of the effort to modernize the country. In fact, quite recently the government allowed foreigners to own land (for 50 years) under specific conditions. The overseas Vietnamese have been important for a long time; I remember in 1995 when I was here, I learned that the Kieh Viet remittances were instrumental in supplementing income and allowing people to buy motorbikes which they could not do on their local salaries. The Overseas Vietnamese are numerous. Many fled the Communist regime during the war or after 1975 and settled in the United States. I learned last night there were 4,000 Vietnamese in Lincoln, Nebraska!

It’s really neat being here close to the Lunar New Year, and I realized I’ve never been in Asia this close to the New Year before. It has become a marketer’s paradise. As one of our speakers just described the consumer – materialism, conspicuous consumption, and individualism are rampant (We won? Can Wal-Mart be far behind?)

As for Confucius, I read an interesting book several years ago, entitled, “Confucius lives next door.” The book described the persistence of Confucian thought in Japan. It’s true here, too. There’s one Confucian saying that I’d like to address in the rest of this blog: It is a pleasure to welcome guests from afar. That’s certainly true for my experiences in Vietnam, which students at IWU, who are Vietnamese, enhanced by welcoming me, either in person, or through their parents. They let me meet people who are locals, not viewed from the bus.

One of current students told me, “My parents want to meet you.” When I called the father, on Sunday, he told me to phone him when I was done with my tour and he’d come meet me. He picked me up and we went to Hoa Kiem Lake, the center of the old city, for tea. He’s a government official (assistant to the Prime Minister of Vietnam) with a master’s degree in economics from Williams College, a Ph.D. in econ from Hanoi National (where he’s taught) and a Fulbright Post Doc at Johns Hopkins in Washington. We wandered around the city, had dinner at a quiet Vietnamese restaurant (without foreigners!), and I told him I’d like to see the water puppet show, which I’d remembered as one of the great entertainments the two times I’ve been in Vietnam before. He bought two tickets but admitted he’d seen the show hundreds of times before and did not need to see it again. He did, however, bring me back to the hotel, where I found a faculty member who wanted to see it, then drove us, waited, and took us back.” You don’t need to do this,” I suggested, knowing that as his son’s teacher, I would merit the attention.

The following day, he invited me back to have dinner at his house with his family. He explained that his “family” (extended) had combined to “invest” in my student’s American education (as his father and uncle had gone to school in the U.S., their sons would have to do so or lose face). His daughter, he proudly told me, had placed second in the English competition for 5th graders in Hanoi. After dinner, she absented herself “because it is a school night and I have homework to do.”

Last night he asked if I would meet his mother, who lives with a younger brother along West Lake, not far from here. I did so, and met a young man who would like to go to the States to study (as father and uncle had). Interestingly, the uncle, being of the right generation, had studied in Prague, when Vietnam was an Iron Curtain country. Dad is arranging for a driver to get me to the airport, and had lunch with me this afternoon and left his brother to make sure I saw the two temples near here that were high on my list of things to do. The temples date from the 11th century and the founding of Hanoi. Teacher, and elder, and guest from afar – a powerful combination in a Confucian world, as the next example also illustrates.

Last night a December graduate of IWU from Hanoi who was home awaiting his departure for graduate school at the University of Nebraska picked me up on his motorcycle and asked, “What kind of food?” I said, “Vietnamese of course,” and off we sped, like locals, to a restaurant where he introduced me to his girlfriend (a student at UN – I see the picture perfectly); the three of us sampled a variety of the local cuisine, including some dishes I’d not had before (Vietnamese food is quite varied – lots of seafood and noodles; the primary noodle is called pho, pronounced roughly fuh – and quite good). On the way back, he offered a tour of the old city. Motorcycles zoom in and out where cars fear to tread (or are blocked), so it was quite an exciting ride. My colleagues were impressed that I’d been able to do it – and survive. We have a farewell banquet tonight, which I leave for departure to Narita in Tokyo, then to Dallas and then home. As always, I’m Hanoied at having to leave, but it will be good to get home and think about coming back to Asia in May.

Yi lu ping an, as we say in Chinese. A peaceful journey – and chuc mung nam moi. Happy New Year. And congratulations to my new and old Vietnamese friends on the New Tet offensive.

We’re spending the last days in “school” meeting with professors and businessmen, and visiting businesses.

Here are some random thoughts on what I’ve seen:

Vietnam is developing, but not developed yet. The stock market for example lists 350 companies (and stock trading companies – there are 150 of them) and is open 8:30-11 five days a week. It used to be open only Monday/Wednesday/Friday.

We visited GM Daewoo, which is the second largest automobile company (after Honda). The plant can produce up to 10,000 cars a year (Mitsubishi manufactures 120,000 per shift), or rather assembles, since it doesn’t “manufacture” anything. It did have a 200% growth over 2007, but it shows that the automobile industry is not highly developed. That’s fortunate; neither is the infrastructure. I can’t imagine all the motorbikers converting to auto drivers. Hanoi, at least the old quarter has streets that are barely a horse cart wide. One might have to destroy the charm of the old city (charm based in part on its Vietnamese history and its French history – the French part is old boulevards, tree lined streets, and colonial mansions (some of them once occupied by the French now housing the comparable Vietnamese departments).

We also visited Deloitte, an accounting firm, which has a history dating (as does Daewoo) to the mid-1990s, when Vietnam “opened”. It’s opening was hastened by agreements with the U.S. ending the U.S. boycott, and more recently, by Vietnam’s admission to the WTO. Deloitte has offices in HCMC, Hanoi, and Haiphong, but has a cluster arrangement with SE Asia that taps into Thailand etc. The company has major multinational clients, but not many in the small and medium sector, which is very large, but small here is SMALL.

We were encouraged to be careful in our questioning, because Hanoi, as the political capital, has more State Owned Enterprises than does Saigon. Certainly, the transformation of the economy here has featured the privatization, or as they like to call it, equitization of the. In 1990, there were 12,000 SOEs, a number that has shrunk to 1,500 today. The remaining companies are bigger and more diversified – e.g., Vietnam airlines is into banking, but one of our speakers noted that the SOEs have gone from trying to become more efficient and competitive to raising more capital. We visited the Vietnamese Post and Telegraph department, which is struggling with the Internet and DHL; it controls fixed lines, but fixed lines are at least as outdated here as they are in the States.

Vietnam has moved beyond the “American War.” Over half the population has been born since the reunification of the country. The United States is also Vietnam’s biggest trading partner, and one of the largest investors in Vietnam. Not surprisingly, Taiwan is the number one investor, followed by Singapore, Japan, and Korea. One interpretation is that some of the non-U.S. investment is from U.S. subsidiaries, who are not prohibited by U.S. law from bribery. The country is around 70% rural, and is true elsewhere in Asia, there are great gaps between rural and urban centers. We’ve been in luxury hotels in urban areas (I am in awe of the retractable roof on the swimming pool here), but as I mentioned did get to a school that Cargill built because the area was too poor to build a school. While the income average is under $1,000, but $2,000 in Hanoi and $3,000 in HCMC, the average is kind of misleading – you know the joke about averages? If one hand is in boiling water and the other in freezing water, the “average is temperate.”

My sense is that this is sort of like China in that it’s a political one-party state, but the bargain here, as elsewhere, is that in exchange the party promises increasing economic growth. So far, that’s happened. However, nearly every business we’ve visited has pointed to the chaos caused by the integration of Vietnam into the world economy. The papers are full of the problems it’s causing here (the garbage pickers are suffering).

Well, one other thing that I wanted to mention, but it’s getting late, is the usefulness of having locals who really show you around. I had two here – the family of one of my current students and a former student who graduated in December but was home. I’ll save that for tomorrow, if I get a chance, before I leave at midnight.

Good night to me, and good morning to you.

January 11

One of the features of traveling as I do is that each day brings incredible opportunities to do spectacular and frequently new things. Sometimes these opportunities are, literally, opportune. That happened our first night in Hanoi when the only non-business professor, who is in awe of this program’s locations because we’re in the Club area (I could get used to being pampered, as we are; there’s a separate lounge for a “happy hour” that was so good we didn’t have dinner Friday night), and I went for a walk around Westlake, where we’re staying at the Sofitel. (PS — The pool has a retractable dome). The main way Americans might know about Westlake is that John McCain was shot down here in 1969, and there’s a monument to the heroic citizens who defended Hanoi against the foreign invaders.

Anyway, Professor Berman wanted to find a high school near here that apparently attracted the cream of Vietnamese society, and turned them into good revolutionaries against the French. We walked across the lake, where he thought the place was; he speaks sometimes passable Vietnamese (as I told Carolyn, I enjoy watching him interact because the Vietnamese usually look at him the way the Chinese look at me when I attempt to speak Chinese – befuddled as to what language is being spoken). We finally found a coffee shop where he engaged someone who understood, and told him it was far away, so we went into the shop for chocolat chaud (hot cocoa). He spotted a photograph that he decided he “had to have,” because it was similar to a lacquered painting he had purchased last fall when he was teaching in Hanoi. One thing led to another, and it turned out that the photographer was the uncle of the cafe owner, and would we like to meet him? Next thing we know, we’re going two doors down (past the black and white cafe, in case you’re wanting to follow in our footsteps) into the photographer’s apartment, where we were treated to his wonderful portfolio (I bought one) and a conversation, in halting English and halting Vietnamese into his life; it was neat just to see his apartment.

The next day was planned opportunity, and in fact the past two days – the weekend here before Tet, the New Year – people were enjoying the outstanding weather and doing their shopping for the holiday, which essentially shuts down the country for a week. We were scheduled to visit Ha Long Bay, a world heritage site that had escaped me in 1995 for reasons that now escape me. We had a choice – whether to spend overnight on the bay (shades of the seabase) or do a looong one day trip; the one day trip advantage was that Sunday we would have a city tour of Hanoi, otherwise we’d get back mid-day. I opted for the day trip.

Ha Long Bay is famous for the karst scenery (like well-known Guilin in China); it’s developed into a tourist site par excellence, with dozens of boats hustling thousands (it seemed) of tourists (this is a good time to go to Australia, I think; down under is up over – i.e. they’re here!) If you want to know what the bay looks like, I’ll try to send a photo with this, and if that doesn’t work, check out Indochine with Catherine Deneuve, which is a sumptuous film reflecting the French nostalgia for a colony it lost a half century ago. We went out to a cavern discovered in 1994, which is to say it was not trashed at all, and sailed the bay for a few hours and then came back to Hanoi. The road was decent, the traffic indecent, and the only major difference I saw to compare our Northern trip (708 miles to Saigon) with the South was that up here there were fewer Churches and pagodas along the road. We spent today in the city of Hanoi, which I had remembered as one of the most European cities in Asia. In fact, as we drove past one building, I remarked that I’d seen it in Bucharest last summer, and wondered where it would follow me in the future. With the French city attempting to resemble Paris (as the late 19th century European cities also did), there were remnants of France’s 150 years of rule throughout the city. The old quarter, by contrast, reflects the fact that Hanoi has been on and off the capital of countries here for nearly a thousand years; in fact, if you’re here 10/10/10, you’ll be able to join the celebration of 1,000 years of the history of Hanoi. Supposedly one of the kings of the Ly Dynasty took a boat trip on the Red River (which I can see from my window) and saw a dragon ascending; it was so auspicious he moved the capital here. I have no independent verification, and I was not around at the time! Honest.

The places we toured today reflect the tortured history of the country, which is located in an area my son David has dubbed the Balkans of Asia. There are monuments to the heroes who fought the Chinese, including two ladies who mustered a defense of the country (as late as 1979, the Chinese have attempted to cross the border here, and eventually got sent packing); there are monuments to the Vietnamese hero who stopped the Mongols (perhaps the only peoples to do so); I thought the Christian armies led by Hungary turned back the Mongols at Budapest, but someone told me that the death of Genghis Khan called off the attack as the chieftains had to return to Mongolia to vote for his successor. (In fact we stopped yesterday at a cemetery for soldiers and met a woman whose brother had died in the Vietnamese liberation – certainly appropriately applied in this case – of Cambodia from the Khmer Rouge – the Killing Fields bunch – in 1978 or so. A book I saw is entitled roughly, Vietnam at War, 1854-1980.

As you might expect, many of the museums and monuments deal with three topics: Ho Chi Minh, the “French War,” and the “American War.” Ho Chi Minh was the first president of Vietnam, and the inspiration for its liberation from the French and ultimate reunification, although he died before the end of the war. His mausoleum houses his embalmed body, embalmed by the same Eastern Europeans who did Lenin and Mao. It’s a solemn place, with the “Ho Chi Minh” mall a respectable distance away, unlike the similar mausoleum for Mao. Uncle Ho is everywhere, sort of like George Washington – in public places, on propaganda billboards and sayings, etc.

The other wars are memorialized either in buildings or in the museums. In most cases, the new emperors replace the old, but in 1954, when the French surrendered Vietnam (temporarily dividing the country awaiting an election for unification that never happened), Ho refused to move into the palace that had been the home of the governor general of Indochine; he said it was too rich for a poor country, and lived in cottages on the grounds until he built a very modest stilt house that visitors still traipse through. The palace is now a guest house for foreign dignitaries.

As for the war museums, I went to one that features an enormous diorama of Dien Bien Phu, the big battle in Northwest Vietnam where, in 1954, the French lost so badly they called “Uncle” (Ho). On its grounds are remnants of the fort the Vietnamese built in 1804, an arsenal tower that is the symbol of the City. There’s a sculpture of parts from American planes shot down during the Vietnam war that’s about 40 feet high, and guns captured from armies from the mid 19th century on.

We also visited a few sites that demonstrate that while, as one of our speakers noted, Vietnam is not a small China for business, the country is indebted culturally to China. One of my favorite places is the “Temple of Literature,” which is a Confucian Temple. Vietnam instituted Confucian exams and until missionaries transliterated the language using an alphabet, used the Chinese characters. In the temple is a statue of the Great Sage, and names of the scholars who passed the examinations to become mandarins (none of your names were on it – I checked!) Having been to the Confucian in Beijing, Seoul, and in Confucius’ hometown of Qufu, I know a Confucian temple without any confusion (It’s getting late!)

Finally, we saw the “one pillar” temple, which is another symbol for Hanoi. Built early in the Ly Dynasty, it’s an obvious example of East Asian (rather than South Asian) Buddhism – the earthy colors rather than the gold and cut glass of Thailand, marking Vietnam’s ties with its northern neighbor. Inside is the Goddess of Mercy, (who became a woman in China, but not in India or SE Asia), making the site a popular one for women seeking boy children.

One transition to the next blog – I spent the late afternoon with the father of one of my IWU students, and tomorrow evening I’m visiting with his family. He pointed out that his family had pitched in to send his son to the United States, another example of Confucian society – but that’s for tomorrow, when I go back to “work.”

January 10

Hello from Hanoi, where we arrived earlier today. It’s quite temperate in this city, which is nearing it’s 1,000th birthday (that’s 1,000) unlike Saigon, which is a mere 300 years old (youngster!), and the political city as Beijing does toward Shanghai. The weather is in the 60s during the day, and the upper 40s or so at night, and that’s Fahrenheit. The locals, though, are in their woolens and down clothing – and it’s not a fashion statement. They think it’s cold, and given their warm summers, they may be right. It doesn’t snow here, and I suspect it’s in the tropics (I’ll check my GPS tomorrow)

As I was out and about this morning (which was free to us), I got up early and walked to the market (the Ben Than market has its counterpart in most Asian cities) – it’s an opportunity to buy almost anything you want – from clothing to groceries, under one roof – including a restaurant and one of my favorite places‚ the wet market (wet because the sellers feature live fish and recently killed chickens, cows, etc.) After 15 minutes of this mayhem, I hired a cyclo (the local type of rickshaw, where you enter kind of a basket and are pedaled around town. The persistent Mr. Tom promised me a guided tour for the remaining hour and a half, and took me to places I’d never been before. For around 90 cents, he helped me navigate the purchase of a baguette sandwich (I think it had pork sausage and various other meats) that I’d seen others eating on the street, but not in the hotel. Should be required eating! Only the Vietnamese rival the French for breads! One of the places we visited was an “Army market,” which, near as I could translate from Mr. Tom’s English, had been an Army market under the U.S. days (it was hidden away) and offered the opportunity to buy various Army/Navy surplus items. We also stopped at a pagoda which he said was 150 years old, and it might well have been, before he deposited me back to my hotel so I could pack for the 706-mile ride to Hanoi.

As I was pondering deep questions in the cyclo, partly to avoid thinking about the traffic that immersed and swirled around me, I thought about one of the questions I raise in class – about the social responsibilities and the awesome power of multinationals, and I thought I might share my observations of two businesses in Vietnam and what they’ve done to help make the world different/better. This, in the context of an economic downturn in the developed world that has ripple effects in the developing world (the Vietnam Times stories are about – among other things – layoffs in manufacturing and in tourism because of declining demand).

I’ve made the point with some of the Liberal Arts faculty that business support and initiative will be at least as important as individual and volunteer initiative in resolving many social problems. After all, the Bill Gates Foundation gave enough money to inoculate all the children of Vietnam against a few specific diseases.

Here, we went to a grade school outside Bien Hoa, about 2 hours from the Louis Vitton store in Saigon. The school had been built by Cargill because the government had been too poor to build the school for the children who would stay too poor without education. It was one of 29 the Cargill Corporation had built, all in the poor rural areas. The company matches the contributions of its employees, suppliers, etc., but has a full time Cargill Activities person, who seeks new opportunities and monitors existing ones.

The second example was from AA furniture. The CEO, of whom I’d spoken admiringly, told us that he was converting to the use of “green” wood – and I don’t mean the wood my Scouts use to make fires. There’ s apparently some independent organization that certifies the greenness of wood; he’s been lining up suppliers who meet these approved standards. While he admitted European customers are much more sensitive to the certification than Americans, he stated that he charges no premium for products made from the “green” wood – which is good business and, to me, good conscience.

January 8

We had a wonderfully informative day today, with two great site visits. The first one was to the largest hospital in Saigon (which I learned today is still the official name of HCMC –Ho Chi Minh City), at least the largest state hospital, and not only in the city but in the southern part of Vietnam.

The hospital is at the top of a four tier system of state care, and has about 120 operations a day. It accommodates 2,800 patients a day, with 1,700 beds, which somehow or another doesn’t compute. There’re huge “ward rooms,” and no private rooms. About 35% of the patients are trauma results – i.e. automobile accidents, or more likely motorcycle crashes. Last year, the government made wearing helmets mandatory, which has reduced the number of deaths, but our guide (who’s not a state employee) made the point that drivers on the open road get crazy, and we’ve seen enough of the traffic to make me glad someone else is doing the driving. As I said, there are a lot more vehicles than there were the last time I was here (2001), but the infrastructure leaves much to be desired. Not just in HCMC, but elsewhere. We were on Highway 1, the NS connector – I think it goes from the Mekong Delta to the border with China – roughly 1,500 miles. There are .62 doctors for every thousand people, and while I don’t know what comparable figures are in the United States, I would suspect over 100X more (at least), and certainly would be better in the countryside in the U.S.! What said “stay healthy” to me more than anything else was the revelation that the doctors have no national certification – any medical school can decide its own curriculum.

If you can’t stay healthy, it also helps here (as elsewhere) to be wealthy to get good health care. There are private hospitals, but the average income in Vietnam is $862, which means some folks are very rich and some are very poor; it’s the kind of contrasts I’ve described elsewhere in the developing world. We’re in the Gucci district, but elsewhere in HCMC are shacks. I’ve got the pictures to prove it.

Our afternoon visit was to a fascinating furniture factory. The only foreigner working there is an American, graduate of Carleton and the University of Chicago Graduate School of Business, who’s the Chief Operating Officer, and in his mid 30s. I enjoyed his presentation so much I asked him if he’d host my students when we come back to Saigon in May. His company is a real niche player – he does upscale hotels, stores (Louis Vuitton, etc.) He noted that the contraction of credit on the part of the Hong Kong and Shanghai bank for all furniture companies forced his company to seek bonding from Vietnamese banks (which scared some of his customers), and has caused some of his suppliers to fold also. It was a graphic illustration of the hazards of the flat world. One item that might explain why the furniture industry has come from the Carolinas to Vietnam was that he was making a piece of furniture (the woodworker was from a woodworking village near Hanoi, working from a drawing of the desired piece) and would take 200 hours to gouge the wood – for a product to be sold for $1,200 (if priced just on labor, that would be $6 an hour!) The ride there took us to the fringes of HCMC, on a two-lane road, with traffic that would have resembled what we saw in India last year – had there been animals on the road! In the factory lot itself, there were no cars – only bikes and motorcycles.

My day started with a nice walk around 6 a.m., and I think it’s time to get to sleep. But not without a lesson on the currency. Vietnam’s currency is the dong. One dollar is worth 17,000 dong. The largest bill is I think 100,000 dong, so you cash $100 U.S. and have a large pile of “folding money.” When I got back from my walk, though, someone in our group asked how I was responding to jet lag. “I feel like a million dong.” I hope you’re all feeling well, too.