Discrepancy between GDP and GNI of Asian countries

[William Hung]

I agree, it seems like a lot of the failure is the result of the shortsightedness of the politicians and leaders. Don't get me wrong, these foreign investors are no saints either and their no 1 priority is profits, but the politicians should have planned how they could fully take advantage of their investments and capitals. It was a chance to develop their infrastructure, adjust their policy and restructure their corporate governance not just for foreign investors, but also for their local companies to compete as well. It's been 28 years since their economic reform, thats plenty of time to smooth out any kinks and address these issues mentioned. All these recent news made it look like they've only began their reform a few years ago.

I'd like to hear the opinions of the Viet members. @xesy @mrfly911 @dichoi @Carlosa @Rent

You guys are sensible posters, what do you say? are we missing out on anything?

This is not a troll thread nor a body organ measuring contest. We just want to discuss the bits and pieces behind these GDP, GNI data, etc.

 

[alaungphaya]

I agree, it seems like a lot of the failure is the result of the shortsightedness of the politicians and leaders. Don't get me wrong, these foreign investors are no saints either and their no 1 priority is profits, but the politicians should have planned how they could fully take advantage of their investments and capitals. It was a chance to develop their infrastructure, adjust their policy and restructure their corporate governance not just for foreign investors, but also for their local companies to compete as well. It's been 28 years since their economic reform, thats plenty of time to smooth out any kinks and address these issues mentioned. All these recent news made it look like they've only began their reform a few years ago.

I'd like to hear the opinions of the Viet members. @xesy @mrfly911 @dichoi @Carlosa @Rent

You guys are sensible posters, what do you say? are we missing out on anything?

This is not a troll thread nor a body organ measuring cont est. We just want to discuss the bits and pieces behind these GDP, GNI data, etc.

Heh. I know there's a lot of bad blood between Viets and Chinese (though I'm not sure why - is it because of the war? The Spratlys? History?), but I quite admire Vietnam. They've come off 2 major wars in their short history and they've transformed their country into a relevant regional power by opening up (unlike us who went into our shell for 50 years). You can't be too harsh on their policies. Who would have wanted to invest if there wasn't low hanging fruit? The Vietnamese haven't really done anything too wrong. Small countries just have to bend over and take it sometimes if they want things to change. That's the way of the global economy. These problems of corruption are just what they have to face to move into the next phase. Remember that of all the SE Asian economies, Vietnam was pretty late joining the party. They didn't have the financial maturity to be affected by the Asian Financial Crisis like other countries and probably why they're a little more naiive.

BTW making microchips isn't really a hitech industry anymore. It's prestigious but there isn't much if any TOT. The value added is in their design and AFAIK even the big players outsource the designing to foreign specialists. ARM in the UK is a good example. I have a friend who interned there years ago and it was scary the number of chips that were actually designed by them. I think they did the majority of the iPhone chipsets.

 

[Viet]

yes, it's true shame, what you think will happen if they got TPP? you have not seen anything yet for those annam pigs

I am very disappointed from you khmer boy. we saved you from the deaths, abyss. but all we hear from you is insulting. let me tell you we won´t save Cambodia if you come under the slaughter again. you are such ungrateful people.

Pho is poor people food. If you like carbs and MSG pho is fo you

wrong. pho is for both poor and rich people. everybody is equal, there is no social division between classes. socialism pure

A quick Google search also showed this news piece about VN's supporting industrial problem:

English - VietNamNet News



So these Japanese owned manufacturer need to import about 80% of materials or components. And I'm guessing these Japanese companies are relatively lower-tech than Intel. Not quite 100% component importation, but 80% is still shockingly high. Like what FairAndUnbiased said, it's been 28 years since VN started it's economic reform, and over 10 years since large foreign companies been making investment into the country. So what have their leaders being doing the last decade? we would normally expect their supporting industries to be relatively developed by now. But they are now only at the stage in drafting policy to address these supporting industry problem.

Why have foreign companies moving into VN all these years? I think FairAndUnbiased have covered the main points, but I'd like to make another two speculation of mine:

1. If a MNC also owns or control (through partnership, etc) their supporting industries, whether locally or outside the country, then they could cook up or manipulate their balance sheet in order to maximise their overall profits. I suspect, without evidence, that Samsung could be doing this. They bring along with them "partners" in the their supporting industry chain and can manipulate or dictate the "cost" of the components or materials being imported. Likewise, Intel could dictate the value of the "product" that are getting exported out of VN back to other Intel factory abroad.

2. Contrarily, some foreign companies may indeed be losing profits due to poor local supporting industries and really want to see it getting improved and developed. When first making the investment, they probably predicted that the local supporting industries will develop, but the local govt have failed them and didn't produce this expectation.

Black, where are you from as you hide your country flags?

 

[mrfly911]

You guys are sensible posters, what do you say? are we missing out on anything?
This is not a troll thread nor a body organ measuring contest. We just want to discuss the bits and pieces behind these GDP, GNI data, etc.

Yes, yours make sense. Our economy isn't good.

 

[William Hung]

Black, where are you from as you hide your country flags?

Why do you always need to ask for my background? is it because you rather make personal insult instead of engaging the subject matter?

I can assure you, right now I'm residing in NZ for the rest of this study semester, then after the next few months I will return back to my main campus in Aus to finish my study next year. Where I'll go after that? I don't know, stay in Aus if they accept me, if not, then maybe try move to Germany. So you are free to insult those 3 countries. As for my ethnicity, I already told you lots of time I'm not Chinese. I once posted a picture of my tribe but some mod deleted it.

Yes, yours make sense. Our economy isn't good.

What about the business environment there? easy to start up and run a business? are there any form of support from govt? any access to special low interest loans, etc, for certain sector? What is the process like for business or individuals to file their tax paperwork?

 

[Cossack25A1]

@FairAndUnbiased, @LeveragedBuyout, @Cossack25A1 @alaungphaya @fuse2014 ... here are some more very recent news articles related to the discussion.

The European commission have begun their investigation into possible transfer pricing manipulation used by Apple:

The European Commission Opens an Investigation into Transfer Pricing Practices | The National Law Review



Interestingly, Ireland is another country with huge negative GNI/GDP discrepancy/divergence.

It seems like Apple has also involved Australia in its transfer pricing scheme. The Aus govt is also now investigating other tech corp like Google and Amazon who might also be doing similar manipulation via Australia:

Tech companies in tax avoidance inquiry crosshairs | ZDNet



So there is a real possibility that big name corporations are still practicing transfer pricing and other form of manipulations by using low tax countries with lax regulation like Ireland and Vietnam.

I'm not too sure what the real situation is like in Ireland but this article here about VietNam just nails the coffin for me:

Foreign investors make big profits, then flee country - Lexology







The article said not all foreign companies are practicing these kind of behaviours (only some). But it sounds like the environment (huge tax holidays, lax law, questionable auditing, no transparency, corruption, etc.) is ripe for foreign companies to manipulate and exploit the situation.

My suspicion is now off the richter scale.

It is a good thing that I am not much of a fan of Apple. I am quite surprised on the price of the iPhone 6 yet many still buy them, willing to throw out large amount of money for a gadget.

 

[Nike]

It is a good thing that I am not much of a fan of Apple. I am quite surprised on the price of the iPhone 6 yet many still buy them, willing to throw out large amount of money for a gadget.

they are just err plainly stupid and naive, they actually bought the Apple brands name instead of technological core inside of those gadgets. A well made and well designed Chinese made gadget is actually more worth to buy.

 

[Cossack25A1]

they are just err plainly stupid and naive, they actually bought the Apple brands name instead of technological core inside of those gadgets. A well made and well designed Chinese made gadget is actually more worth to buy.

I guess the purpose of other people on buying Apple brands is simply to join in the hype.

 

[mrfly911]

they are just err plainly stupid and naive, they actually bought the Apple brands name instead of technological core inside of those gadgets. A well made and well designed Chinese made gadget is actually more worth to buy.

Have you ever used an Apple product?
Is there any product made by China can compare to?

P/S: I'm using a Lenevo notebook.

 

[Viet]

Why do you always need to ask for my background? is it because you rather make personal insult instead of engaging the subject matter?

I can assure you, right now I'm residing in NZ for the rest of this study semester, then after the next few months I will return back to my main campus in Aus to finish my study next year. Where I'll go after that? I don't know, stay in Aus if they accept me, if not, then maybe try move to Germany. So you are free to insult those 3 countries. As for my ethnicity, I already told you lots of time I'm not Chinese. I once posted a picture of my tribe but some mod deleted it.

why should I start to insult you if I know where you come from? I just want to ensure I don´t talk to a ghost

 

[cybertron]

ooops,typo

beef is $3/kg
Sheep/mutton is $6/kg

You gave me a mini hear-attack. I almost packed my bags to pakistan

 

[Carlosa]

What about the business environment there? easy to start up and run a business? are there any form of support from govt? any access to special low interest loans, etc, for certain sector? What is the process like for business or individuals to file their tax paperwork?

For foreign companies or individuals, the process to start a business in Vietnam is a bit more difficult than in western countries, but it depends a lot on the location; In Danang for example, they have a one stop center where you do all the paperwork, etc and you can be approved in just a few days if you already have a location for the company. In other provinces, it can be a lot more complicated and you might have to grease somebody's pocket to make things easier. The tax system for business is particularly complicated and regulations can change at any moment and without any notice or discussion with those affected by it.

Regarding government support, there are a lot of incentives if you are in the type of business activity that they want to promote. Government employees will be happy to moonlight for you to help you with the applications, paperwork, etc if they can get some money.

No such thing as low interest loans in Vietnam at the moment, they are too high as a consequence of anti inflation policies but they are coming down.

They just approved a big incentive package for support industries, but I think it will mainly be used by foreign companies. Local companies usually say that they can't compete with the prices required by Samsung, etc or can't make it in terms of specs. They usually give up without much trying. I think it will be mainly the Koreans and Japanese that will revamp the support industries.

Vietnamese people are quite business entrepreneurial for the most part, but the country is mismanaged by an incompetent, corrupted bureaucracy that permeates every aspect of life, Its a cancer and there is no solution on sight for that at the moment.

 

[nufix]

they are just err plainly stupid and naive, they actually bought the Apple brands name instead of technological core inside of those gadgets. A well made and well designed Chinese made gadget is actually more worth to buy.

Err...iPhone 6 user here

Stupid or naive is not the word I would use to describe why Apple fans buy Apple products regardless its technical downsides compared to other new players in the field of mobile communication device. You know that a mobile phone is now more than just a communication device right? When people buy a phone, most people aren't really looking for its actual capabilities or how fast it works and all that geeky stuffs, people buy its brand thus they buy their way into a higher level in their society (gengsi) and people buy its design (most cheap mobile phones lack designs). When it comes to heavy tasks like presentations and college stuffs I rely on my android tab, but can I rely my style on a tab or cheap phones? If I buy a cheap yet technologically superior phone would people around me check the tech-cores of my cheap phone first to determine that I'm a "Wow"? No, people will look its brand first, then its exterior designs, therefore I bought an iPhone.

People don't just buy a USD 200.000 ferrari just to have a great engine right? if so, they would have bought a truck.

Sorry for running out of the topic

 

[FairAndUnbiased]

Heh. I know there's a lot of bad blood between Viets and Chinese (though I'm not sure why - is it because of the war? The Spratlys? History?), but I quite admire Vietnam. They've come off 2 major wars in their short history and they've transformed their country into a relevant regional power by opening up (unlike us who went into our shell for 50 years). You can't be too harsh on their policies. Who would have wanted to invest if there wasn't low hanging fruit? The Vietnamese haven't really done anything too wrong. Small countries just have to bend over and take it sometimes if they want things to change. That's the way of the global economy. These problems of corruption are just what they have to face to move into the next phase. Remember that of all the SE Asian economies, Vietnam was pretty late joining the party. They didn't have the financial maturity to be affected by the Asian Financial Crisis like other countries and probably why they're a little more naiive.

BTW making microchips isn't really a hitech industry anymore. It's prestigious but there isn't much if any TOT. The value added is in their design and AFAIK even the big players outsource the designing to foreign specialists. ARM in the UK is a good example. I have a friend who interned there years ago and it was scary the number of chips that were actually designed by them. I think they did the majority of the iPhone chipsets.

No that is not the case. Making the microchips is still just as hard as the design and there are many different types of microchips. ARM is an instruction set architecture. It is basically how the processor does math and process instructions electrically. The physical design layout (how to implement that in a physical semiconductor, what transistors to place where, how to power it, how to optimize design for best dataflow) is the "design" part. The physical fabrication is at a foundry, which involves an entirely different set of skills - materials science, physics, chemistry. It is not *easier* skills, it is different skills.

Let me make an analogy.

Mathematicians find out and establish the rules of math - how to add, how to subtract, etc.

Physicists use the rules of math and experiments/observation to establish facts of nature, properties of materials and radiation, etc and maybe design some simple devices with them (such as a p-n junction).

Engineers implement it all and use the basic devices (p-n junctions) and turn them into commercial products such as solar cells.

 

[Nike]

Err...iPhone 6 user here

Stupid or naive is not the word I would use to describe why Apple fans buy Apple products regardless its technical downsides compared to other new players in the field of mobile communication device. You know that a mobile phone is now more than just a communication device right? When people buy a phone, most people aren't really looking for its actual capabilities or how fast it works and all that geeky stuffs, people buy its brand thus they buy their way into a higher level in their society (gengsi) and people buy its design (most cheap mobile phones lack designs). When it comes to heavy tasks like presentations and college stuffs I rely on my android tab, but can I rely my style on a tab or cheap phones? If I buy a cheap yet technologically superior phone would people around me check the tech-cores of my cheap phone first to determine that I'm a "Wow"? No, people will look its brand first, then its exterior designs, therefore I bought an iPhone.

People don't just buy a USD 200.000 ferrari just to have a great engine right? if so, they would have bought a truck.

Sorry for running out of the topic

well speaking the truth i am more a technical person rather than follow the trends girls who keeps yawn-yawn and giggling around with others in some cafetaria or boutique, err it's maybe only me and my statement above is very subjective and i am speaking very openly and sometimes very abusive for someone who doesn't know me long enough and that's not only happened in virtual world but in reality too.