Vietnam Success Stories Have Also Done The Long March

03/14/1996

Doing business as an outsider in Vietnam is adventurous enough, but, as ERIC ELLIS in Ho Chi Minh City reports, doing it from the inside is decidedly exciting.

THE smartest business decision Mr Tuan Tran Tai made was to give his fortune and assets away. That was in 1975, when the conquering peasant army of North Vietnam overran Saigon and imposed textbook communist austerity on the free-wheeling South.

Mr Tai was then one of Vietnam's richest men, with assets in banking, textile and property he calculated then at $US2 million but which others put at closer to $US20 million. Twenty-one years later, he is again one of Vietnam's richest men, only this time his assets have tripled. He says he is worth $US6 million; his competitors say $US60 million. In 1975 he was driven around in a Mercedes, just like today. In between times, he drove himself around, first on a bicycle, then graduating to a moped as the communist stranglehold relaxed. "They were quite suspicious of me as a capitalist but they did not hurt me. That is because I came to them, not them to me," Mr Tai said.

Being rich in 1975 was only part of his problems. A far greater political headache was the fact that he was Chinese and an influential powerbroker in the Cholon district, the de facto controller of the then southern regime. After the war, the victorious northerners rightly saw Cholon as an alternative power base, a fifth column of stinking capitalists plotting to overthrow the newly unified communist State.

If Hanoi was already suspicious of Cholon's Chinese, their odour was not helped by the failed 1979 invasion of Vietnam by China's People's Liberation Army.

An ethnic Chinese population of more than two million was whittled down to less than a quarter of that through emigration, and worse.

But in Vietnam's economic renovation, the Chinese are on the way back. State-sanctioned tycoons like Mr Tai are advising the Government, running banks and factories and setting up foreign joint ventures.

After doing nothing substantial for 12 years except "exist", Mr Tai restarted in business in 1987, just months after the 1986 party congress that enacted the doi moi renovation - economic liberalisation - itself a leap of faith.

Today, Mr Tai's Viet-Hoa Bank (the name combines the words for Vietnam and China) is 90 per cent owned by Cholon Chinese and is the flagship of an empire that takes in property, garments and trading.

"The competition before 1975 was not as strong as it is today but the bureaucracy is bigger," Mr Tai told the Financial Review from his office in a magnificent renovated French manor, overlooking his three Mercedes. Careers like Mr Tai's require much juggling, but even he could have learnt a few things from Nguyen Xuan Oanh.

Mr Oanh's CV reads like a book documenting 20th century history. Born in Hanoi, he was educated in a French school in Hanoi in the 1930s, winning a scholarship to go to university in Japan, where he studied and worked from 1940 until 1949.

He then worked for the US military, which got him to the US where he taught economics at Harvard in the 1950s before becoming a senior economist with the IMF in Washington.

He returned to Saigon in 1963 and for the next four years was central bank governor for the deposed South Vietnamese regime, rising to Finance Minister and then Acting Prime Minister.

When the communists took over in 1975, he hid for a month in Saigon's Caravelle Hotel until they found him and put him under house arrest as a prominent southern official - in other words, a traitor.

Soon after the present Prime Minister, Mr Vo Van Kiet, moved to Saigon as party supremo, Mr Oanh got to know him, Mr Kiet got to like him and, as Mr Oanh tells it, asked him to quietly draw up a plan for economic reform.

"Our program became known as doi moi. Everybody thinks renovation was forced on Vietnam by the withdrawal of Soviet patronage, but we predated Gorbachev's perestroika by two years."

Today Mr Oanh runs an investment company and economic consultancy in four languages - French, English, Japanese and Vietnamese - and recently set up Vietnam's first Western-style investment bank.

"I've had a lot of fun," he says