Introduction
It is important to note that evaluating the business climate and cost of doing business in a specific market is essential when making a strategic decision. Under such a framework, one should assess attitudes toward foreign investment, cost of doing business, tariffs, and fees on imported machinery or equipment, and risk factors. The given evaluation will be focused on the target location of Vietnam and Chevron’s positioning in the local market.
Chevron’s Positioning in Vietnam
The historical and current relationship between the United States and Vietnam is a complex one. However, the global business today is not solidified by such relations (Hill 153). Attitudes toward foreign investment, US oil investment in particular, in Vietnam, is positive due to numerous diplomatic development which took place in the last several decades (Samuel par. 1). The overall cost of doing business in the nation is attractive. It is stated that “due to its geographic proximity, lower wages, skilled labor, trade agreements, and regional connectivity, Vietnam has emerged as one of the most preferred alternatives for manufacturers” (Samuel par. 21). The country reached a trade agreement with the US in 2001, which “helped lift several non-tariff barriers while lowering tariffs on a variety of goods,” equipment, and machinery (Samuel par. 8). Vietnam is stable due to low political and exchange rate risks.
Conclusion
In conclusion, Chevron should pursue working with Vietnam, and its low-cost workforce is already skilled, which would require non-substantial investment into their training with a government’s collaboration and assistance. The overall rating of the project is high, and the final decision should lean towards doing business in Vietnam. Its labor is cheap, the government is stable, business costs are low, and attitudes are proven to be positive.
Works Cited
Hill, Charles. Global Business Today. 12th ed., McGraw Hill, 2021.
Samuel, Pritesh. “Why Vietnam Has Become a Promising Alternative for US Businesses in Asia.” Vietnam Briefing, Web.