Vietnam rallies behind security
Editor / Provider: Lisa Hsu, a&s Asia | Updated: 11/4/2014 | Article type: Hot Topics
The anti-China protests that escalated to a riot in May resulted in damages to factories in industrial parks. Many of them were looted or burned down, causing injuries and several deaths to people who were caught in the incidents. The aftermath of the event led to losses of millions of dollars in damages and ceasing of manufacturing operations, as well as temporarily causing economic consequences as factories were required to close down for safety issues. Such violence meant an increase in security demand. Now, Vietnam is reevaluating their security issues, looking to improve safety and deter future incidents.
ECONOMIC GROWTH STILL STRONG
Despite the riot, Vietnam is unlikely to suffer significant economic impact. According to IHS Research, the economic and commercial impact on Vietnam's investment image in the wake of the anti-China riot will be limited, since production is likely to resume quickly in the affected areas. Additionally, the drop in Chinese investment is expected to be temporary, as it is more likely to delay commitment to new projects than lead to the cancellation of existing projects in Vietnam. In fact, according to the General Statistics Office of Vietnam, China has 893 projects on going in Vietnam, with a total registered capital of US$4.7 billion. Furthermore, Japan and Taiwan, the two biggest investors in Vietnam, have registered capitals of $28.7 and $27.1 billion respectively in the country, showing that investors still see Vietnam as an ideal location for investing.
So what does this mean for security? According to Tran Nguyen Dung, Director of HDTEK Technology, “Growth of the security industry is due to market demand. Recently, the real estate market has recovered a bit, the bank system problems are being solved step by step, the belief in the stock market is increasing, and the exchange rate is quite stable.”
SECURITY AWARENESS INCREASES
During the chaos, the lack of security made catching culprits who vandalized and robbed factories even more difficult, as many did not have any surveillance cameras or intrusion alarms installed. With insufficient equipment to capture clear footage of incidents, families who lost loved ones in the riot were not able to bring justice to the criminals. However, this experience has led more Vietnamese people and companies, many of which normally ignored security issues in their organizations before, to become more aware of their security system and services, creating a turning point for the Vietnamese security industry, according to Hoang Qui Hop, GM of T&T Security.
“I believe this incident is a wake-up call for Vietnam's manufacturing sector,” said Terence Ng, GM of IndoChina at Bosch Security Systems. “Many industrial parks and factories were set up over the past years since Vietnam started industrialization, but there were insufficient or no investment in protecting and securing these facilities which is posing a threat to the safety and security of personnel. Now, industrial park and factory owners can no longer take security for granted and need to work on a comprehensive protection plan for their personnel, assets, and facilities.”
Hop also observed that apart from upgrading security systems to protect themselves, “companies are starting to work more closely with local authorities for assistance to obtain information about their employees for background checks, and human resource departments in companies are taking more interest in their staff.”
GOVERNMENT INCENTIVES TO BRING BACK INVESTORS
Vietnam has offered tax breaks and other incentives for companies whose factories were damaged or destroyed during the riot to maintain trade relations, with a reduction of up to 30% in special consumption tax, and reduced import and export tariffs. The government has also committed to ensuring absolute safety for people, businesses, and foreign agencies in accordance with the law and its international commitments.
“The government will have to give assurances to all foreign investors all over the world that it is making its best effort and taking measures to restabilize the business environment for foreign invested companies in the country,” Ng stated. Similarly, Dung emphasized, “Vietnam is a reliable environment to invest. They [the government] are giving compensations to the damaged companies. This is a very good way of handling the situation.”
Additionally, more companies from various verticals have been approaching security solutions, fueling additional growth in the Vietnam security industry. There is an increase in market demand by industrial parks, correction facilities, and city and marine surveillance verticals, which are faced with the need to satisfy companies and citizens requiring protection against future incidents, and to ensure reliable security systems are in place, said Ng.
LOOKING FOR NEW PREVENTION TECHNOLOGIES
Although the incentives offered to companies affected by the riots by the Vietnamese government are not directly related to security, money saved from tax and rent deductions can go to investing in security solutions.
“Companies must seriously look into a physical protection system to protect their assets and facilities against further theft, sabotage, or other malevolent human attacks,” suggested Ng. This system should involve “the setting up of a factory security team, equipment, and procedure to deter, detect, or delay any intrusive action.” He further emphasized the need for a plant's security forces to be able to delay an attack or defend itself until it can notify an emergency response team. Similarly, Bryan Quý, Sales Director of Namson Engineering, emphasized that security solutions providers should supply users with solutions to better connect consumer security systems to the police or government agents to process support requests faster.
In regard to equipment, Ng suggests that there will be an increase in market demand for high resolution HD and megapixel cameras with wide dynamic range and low-light sensitivity functions, as demand for video clarity and recognition capabilities have become increasingly evident. Other products such as external and internal alarm sensors for perimeter and facility protection, and access control linked with video systems to prevent unauthorized access are options for companies to install to protect their property. Video content analysis with functions such as crowd detection, loitering, and fire and smoke detection can be used to immediately recognize risks and reduce the need for human operators. With the growing location of banking ATMs, security solutions are needed to secure different banking locations.
Nguyen Minh Cuong, Assistant Manager for System Solution Division of Panasonic Vietnam, notes that camera and alarm systems are basic requirements, with an estimated growth of over 10% for the banking security market. High resolution cameras will be popular in order to monitor customers' behavior in the ATM booth, and remote monitoring will also be an option for banking security solutions. Alarm systems are on the road to becoming the most essential technology for ATMs, as the feature to alert authorities or operators in situations is the main purpose of security systems, especially after business hours.
SOLUTIONS, NOT JUST PRODUCTS
Regardless of whether the riot brought more business to security companies, security companies still need to step up their game. According to Ng, it is essential for security solution providers to be able to offer a comprehensive intelligent solution — one that can reliably capture, analyze, store, view, and manage large amounts of video and alarm information, from early detection of potential problems to final response action. It would also be ideal to have software solutions with site maps and integrated functions to different sensors and elements of the physical protection system. Combining both equipment and software solutions would form a multifunctional and expandable platform that fits into the company's personal requirements.
Since the riot, security solutions providers are under more scrutiny to maintain standard codes and regulations for security solutions, said T&T's Hop, “especially for banks, factories, airports, seaports, casinos, and oil and gas industries. Not only should they sell products but also solutions with the after-sales service.”
Post riot, more people will be willing to spend money on security issues. For example, more homes will install 24-hour-monitored security systems with burglar alarms, panic call, and fire alarm functions. Hop noted that the cost of security systems is not expensive at this time; therefore, it is affordable to install one or two HD IP cameras in a residential home. Furthermore, with the evolution of technology, most people own smartphones or tablets, allowing consumers to monitor their houses through security apps on-the-go via the Internet.
POSITIVE OUTLOOK FOR THE FUTURE
Despite the negative impact brought on by the riots, growing security awareness as a result of the events will hopefully provide Vietnam with the push it needs to jump-start its security market. Furthermore, as the economic situation in Vietnam — and across the globe — continues to improve, as well as adding on the support of the government to bring in more foreign direct investment, Vietnam has the tools it needs to build up and improve its security landscape.