Taiwanese Entrepreneurs Build a Vietnamese Tienmu

Phu My Hung, a Taiwanese-built housing development, has been Vietnam's most luxurious residential district since 2003. "Only two kinds of Vietnamese don't buy a home in Phu My Hung," jokes Alpha Chen, a Phu My Hung Corporation's international marketing manager, "those without good sense and those without money."

Over the last couple of years, Phu My Hung has sold out each of the new buildings it has brought to market on the first morning they were offered. Competition for the properties is so intense that the company now uses a lottery system to determine who gets them. When it put 70-some new units on the market in February 2007, more than 300 people registered for the drawing. Since May, the company has required would-be homeowners to make an upfront payment of US$30,000 to even register for the lottery, but interest remains as heated as ever. Even Lawrence S. Ting, the Central Trading and Development Group (CT&D Group) chairman who founded Phu My Hung 18 years ago, never envisaged this kind of demand.

Lighting the way

CT&D Group is an outstanding example of successful Taiwanese investment in Vietnam. When the Asia-Pacific Economic Cooperation (APEC) forum held its Economic Leaders' Meeting in Hanoi in 2006, Arthur Ting, Lawrence's second son and the current chairman of Phu My Hung, was the only Taiwanese businessperson invited to speak.

Lawrence Ting made the decision to invest heavily in Vietnam some 18 years ago after conducting a market study. The head of the then-KMT-owned CT&D Group, Ting became known as "the King of Vietnam" for the success of the Phu My Hung venture.

CT&D Group's Vietnam investments have included the Tan Thuan Export Processing Zone and the Phu My Hung/Saigon South urban development project (both joint ventures), and the Hiep Phuoc Power Plant (100% Taiwanese owned). The group, which began work on the three sites by improving the soil and leveling the ground, has truly built from the ground up. It has invested a total of NT$30 billion in the projects to date, using the money to create something resembling Taipei's Tienmu area and Hsinyi development zone on 1,000 hectares in Vietnam.

"Few people were optimistic at the outset," says Y.T. Young, president of Tan Thuan Export Processing Zone Development Corp. He says no one imagined the scale and success Tan Thuan and Phu My Hung would have when he and the elder Ting traversed this former swamp in a sampan in 1993.

The 300-hectare Tan Thuan Export Processing Zone was Vietnam's first EPZ, and also the industrial zone closest to Ho Chi Minh City.

When work at Tan Thuan finishes between 4:30 and 5:00 p.m., a sea of young faces flows out of the EPZ and disperses, recalling similar scenes at the Kaohsiung EPZ in the 1960s. Tan Thuan is currently home to 114 companies--46 Taiwanese, 54 Japanese and eight South Korean--which collectively employ the some 60,000 workers who pass through here daily. As the most successful of Vietnam's 12 EPZs, Tan Thuan is also a source of national pride and has even been visited by former US president Bill Clinton.

While reliving much of Taiwan's own early experience, Tan Thuan has also resolved two of the major difficulties companies investing in Vietnam face--it provides its tenants with stable power supplies and, as a joint venture, is well positioned to facilitate the licensing of their businesses and the construction of their facilities.

CT&D Group's Hiep Phuoc Power Plant is currently Vietnam's only foreign-owned power plant and was the first in the nation to receive ISO9002 certification. The 375 MW oil-fired plant, which began operations in 1998, provides reliable power to the businesses in the Tan Thuan EPZ. It also supplies 45% of Ho Chi Minh City's power during the November to April dry season, helping alleviate the 500 blackouts per month the city used to be known for.

Reclaiming a swamp

The eight-square-kilometer Phu My Hung district is the largest urban development project ever undertaken in Asia. It includes the New City Center, University Place, a high-tech center, and a logistics center, all built on what used to be a swamp.

The Phu My Hung Corporation looked at the site's prime location (just 15-20 minutes' drive from Ho Chi Minh City) and the low cost of the land and decided to turn a dream into reality by developing a community here.

This incredible project advanced step by step, becoming ever more grounded as it progressed from condominiums to villas to a large supermarket, a department store, and high-end retailers. It is also the site of a number of schools (including the Taiwanese, Japanese and Korean schools, the Saigon South International School, a branch of the Royal Melbourne Institute of Technology, and the Lawrence Ting Memorial School), the renowned Franco-Vietnamese Hospital, and the soon-to-be-completed international convention and exhibition center. Phu My Hung is Vietnam's most advanced community, a truly groundbreaking development that integrates residential, commercial, cultural, educational and medical functions into a single, multifunctional, international village.

"This kind of methodical long-term development and basic infrastructure construction is inconceivable to short-term investors who want their profits immediately," says Tsai Ching-yun, president of the CT&D Group. He says it was Lawrence Ting's vision and daring that led CT&D Group down the difficult entrepreneurial path and steered it through the hard times that followed the KMT's withdrawal of capital. Sadly, Ting killed himself three years ago in the midst of a financial dispute and lawsuit involving the partners in CT&D Group. Though that case remains unsettled, there is no question that Phu My Hung represents a proud Vietnamese-Taiwanese achievement and a fine example of the pioneering spirit of Taiwan's business community.