Land ownership was regulated, and such large-scale works as dykes were constructed in the Red River Delta to facilitate wet rice cultivation. The OSP can be used as a guideline for government agencies to implement the SDGs in the most effective ways, focusing on areas of importance, such as: investing in people, climate resilience and environmental sustainability, prosperity and partnership, justice and inclusive governance. More recently, alarms on trade account deficits have been raised domestically, especially after joining the WTO in 2007. Japanese and Korean electronics companies like Samsung, LG, Olympus, and Pioneer built factories, and countless European and American apparel makers set up textile operation in the country. The GDP growth was driven mainly by agriculture, forestry and fisheries sectors (4.69 percent); industry and construction (5.60 percent) and service sector (4.29 percent). [99], The World Bank's assistance program for Vietnam has three objectives: to support Vietnam's transition to a market economy, to enhance equitable and sustainable development and to promote good governance. Since the mid-1980s, through the Đổi Mới reform period Vietnam has made a shift from a highly centralized command economy to a mixed economy that uses both directive and indicative planning through five-year plans with support from an open market-based economy. Hydroelectric power is another source of energy. [53], In 2003, Vietnam produced an estimated 30.7 million cubic meters of wood. Though the plan exaggerated regional divisions, the development of exports—coal from the North, rice from the South—and the importation of French manufactured goods stimulated domestic commerce. These two factors together helped Vietnam to become a hub for foreign investment and manufacturing in Southeast Asia. [79], At the end of 2012, inflation stood at 7.5%, a substantial decrease from 2011. [39], In 2010, inflation stood at 11.5%, and 18.58% in 2011. [citation needed], Until the French colonization in the mid-19th century, Vietnam's economy had been mostly agrarian, subsistence-based and village-oriented. The government is actively reviewing and adjusting its policy, as shown in the current official Development Strategy Action Plan 2011–2020, to develop appropriate mechanisms for a more equitable growth across the country; promoting the advantages of each regions, working in collaboration with each other to support and amplify the fruit of development. By December 2004, about 58% had been dispersed. Efforts were also made to decentralize planning and improve the managerial skills of government officials. Vietnam became a member of the World Trade Organization (WTO) in 2007, which freed Vietnam from textile quotas enacted worldwide as part of the Multi Fibre Arrangement (MFA) in 1974. ", "ASEAN, Australia and New Zealand Leaders' Statement: Entry into Force of the Agreement Establishing the ASEAN-Australia-New Zealand Free Trade Area 25 October 2009, Cha am Hua Hin, Thailand", "ASEAN - Australia - New Zealand Free Trade Agreement (AANZFTA) - ASEAN - Australia - New Zealand Free Trade Agreement", "ASEAN Charter: One year and going strong", "Vietnam: New Trade Agreement with Eurasia Economic Union - Global Legal Monitor", "Vietnam - Chile - WTO and International trade Policies", "Vietnam - Korea - WTO and International trade Policies", "Vietnam - Japan - WTO and International trade Policies", "Chuyên trang Thống kê Hải quan :: Hải quan Việt Nam", "The Global Competitiveness Report 2017-2018", http://www.doingbusiness.org/content/dam/doingBusiness/media/Annual-Reports/English/DB2018-Full-Report.pdf, Vietnam Exports, Imports and Trade Balance, Mergers and Acquisitions in Vietnam's Emerging Market Economy: 1990-2009, Council for National Defense and Security, Trade-Related Aspects of Intellectual Property Rights, Special administrative regions of the People's Republic of China, Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, https://en.wikipedia.org/w/index.php?title=Economy_of_Vietnam&oldid=1010281115, World Trade Organization member economies, Articles with dead external links from May 2020, Articles with permanently dead external links, Articles with dead external links from September 2020, Articles with dead external links from December 2017, Short description is different from Wikidata, All articles with vague or ambiguous time, Articles with unsourced statements from May 2020, Articles with unsourced statements from November 2014, Articles lacking reliable references from September 2020, Articles needing additional references from September 2020, All articles needing additional references, Wikipedia articles needing clarification from May 2017, Articles with peacock terms from September 2020, Articles with unsourced statements from September 2020, All articles with specifically marked weasel-worded phrases, Articles with specifically marked weasel-worded phrases from September 2020, Articles with incomplete citations from September 2020, Articles with failed verification from March 2021, Articles with failed verification from September 2020, Articles with minor POV problems from September 2020, Articles lacking reliable references from May 2020, Wikipedia articles in need of updating from May 2020, All Wikipedia articles in need of updating, Wikipedia articles in need of updating from September 2020, Articles with dead external links from August 2019, Creative Commons Attribution-ShareAlike License, On 29 May 2015, Vietnam signed a Free Trade Agreement (FTA) with. Vietnam’s ruling Communist Party approved plans to raise growth to 6.5 to 7 percent for the 2021-2025 period as it aggressively pushes for reforms and high-tech growth. In 2014, Vietnam recorded the third year of trade surplus of US$2.14 billion, the largest trade surplus ever in history. The feudal dynasties always considered agriculture as the main economic base, and their economic thoughts have been predicated on physiocracy. However, seafood exports increased fourfold between 1990 and 2002 to more than US$2 billion, driven in part by shrimp farms in the South and "catfish", which are a different species from their American counterparts, but are marketed in the United States under the same name. In 2017, with the help of the United Nations, Vietnam official started the ground work to achieve the Sustainable Development Goals with the development of the "One Strategic Plan",[113] integrating the SDGs with the nation's Socio-Economic Development Strategy (2011-2020) and Socio-Economic Development Plan (2016-2020). In the first half of this year, the economy advanced 1.91 percent from a year earlier. Vietnam's gross domestic product advanced by 2.62 percent year-on-year in the third quarter of 2020, accelerating from a marginally revised 0.39 percent growth in the previous period, as the economy gradually returned to normal conditions, after loosening the lockdown measures to contain the spread of the coronavirus, the preliminary estimate showed. [59] Petroleum exports are in the form of crude petroleum because Vietnam has a very limited refining capacity. Vietnam has reiterated its commitment to high economic growth following the conclusion of the National Party Congress in Hanoi where it chose its leaders for the next five years. However, the economic impact is expected to be milder than most countries in the region. Access the latest politics analysis and economic growth summary through 2011 for Vietnam from The Economist Intelligence Unit French colonizers, however, deliberately developed the regions differently as the French needed raw materials and a market for French manufactured goods, designating the South for agricultural production as it was better suited for agriculture, and the North for manufacturing as it was naturally wealthy in mineral resources. Intel opened a $1 billion chip factory in 2010, signalling the importance of Vietnam's strategic positioning in the eyes of international business community. Vietnam Manufacturing Sector Expands for 3rd Month, Vietnam Consumer Prices Fall for 1st Time Since 2001, Vietnam Q4 GDP Growth Rate Accelerates to 4.48%, Vietnam Tourist Arrivals Sink 99.1% YoY in October, Vietnam Retail Sales Grow the Most in 9 Months, Vietnam Industrial Output Growth at 4-Month High, Fitch Revises Vietnam Credit Outlook to Positive, European Equities Fall on Rising Yields Concerns, New Zealand Dollar Trades at Monthly Lows, Germany Factory Orders Rise More than Expected. The government is targetting an economic growth of 6.8% this year, but warned that it could slow to 6% if the virus effects continue in the second quarter. [39], Vietnam became a member of the World Trade Organization (WTO) on January 11, 2007. [39], In 2012, export rose 18.2%, valued at US$114.57 billion. Đổi Mới combined government planning with free-market incentives and encouraged the establishment of private businesses and foreign investment, including foreign-owned enterprises. This policy of closure led to a downfall stagnation in the Vietnamese economy in the early-haft 19th century, and contributed to Vietnam becoming a French colony. Finally, agriculture, forestry and fishing represent 22 percent of total output. In 2013, exports rose 15.4%, valued at US$132.17 billion, of which export of electronics now comprised 24.5% of total export, compared with a 4.4% in 2008. Also, the removal of investment restrictions leads to reductions in bribery as a result of more Foreign Investment Enterprises, and consequently more competition entering that sector. Pledged foreign direct investment US$21.3 billion for 2007 and a record US$31.6 billion for the first half of 2008. The GDP value of Vietnam represents 0.22 percent of the world economy. Petroleum and coal are the main mineral exports. By selling vast quantities of shrimp and catfish to the U.S., Vietnam triggered antidumping complaints by the U.S., which imposed tariffs in the case of catfish and was considering doing the same for shrimp. [39][dead link] Between 1975 and 1994, the United States imposed a trade embargo on Vietnam, forbidding any trade during the 19-year period. The number of respondents who believed that their land was sold at a fair market value decreased from 26% in 2014 to 21% in 2017. Domestic and foreign trade were centered around the Saigon-Cholon area. [39], Vietnam is one of the top rice exporting countries in the world, but the limited sophistication of small-scale Vietnamese farmers causes quality to suffer. Handicrafts and art were valued, but commerce was deprecated, and businessmen were called by the derogatory term con buôn. In Tripadvisor's list of top 25 destinations Asia 2013 by travellers' choice, there are four cities of Vietnam, namely Hanoi, Ho Chi Minh City, Hoi An and Ha Long. In 1806, Emperor Gia Long of the new Nguyễn dynasty imposed the Sea Ban policy, banned all Vietnamese oversea business and Western merchants to enter Vietnam. [41] The country's access to the WTO was intended to provide an important boost to the economy, as it ensured that the liberalizing reforms continue and created options for trade expansion. • It is not a free market capitalist economy More recently, in 2019, Vietnam received 18 million international arrivals. Vietnam’s cabinet has targeted economic growth of 6.5% next year, signaling a return to the same growth pattern experienced before Covid-19, … Vietnam’s Communist Party re-elected Nguyen Phu Trong signaled the country would continue its push for strong economic growth and maintain its … It was expected that access to the U.S. market would allow Vietnam to hasten its transformation into a manufacturing-based, export-oriented economy. The Key Drivers of Growth in Vietnam Interestingly, one of Vietnam’s most established economic drivers is trade, with the country known as a prominent exporter of goods to nations across the globe. [82] In 2016, it was only 2%. Vietnamese economic growth. However, the WTO accession also brought serious challenges, requiring the economy to open up to increasing foreign competition. The United States continued to be Vietnam's largest export market, with US$28.5 billion. The exchange rate between the U.S. dollar and the Vietnamese đồng is important because the dong, although not freely convertible, is loosely pegged to the dollar through an arrangement known as a "crawling peg". From 1994 to 2004, GDP attributable to the service sector grew at an average annual rate of 6.0%.[39]. "[42], Vietnam's economic policy following the 1997 Asian Financial Crisis has been a cautious one, emphasizing macroeconomic stability rather than growth. In the South, agricultural development concentrated on rice cultivation, and, nationally, rice and rubber were the main items of export. In order to stimulate supply, govt. In 1995, Vietnam joined the ASEAN community. Access the latest politics analysis and economic growth summary through 2011 for Vietnam from The Economist Intelligence Unit [39] However, between 2003 and 2005, Vietnam fell dramatically in the World Economic Forum's global competitiveness report rankings, largely due to negative perceptions of the effectiveness of government institutions. HCM City posts economic growth in January HCM City’s economy saw a variety of bright spots in the opening month of 2021 despite the ongoing complex developments of the COVID-19 pandemic. Vietnam targets growth acceleration, shift to hi-tech gear in Communist Party economic blueprint Back to video In an economic development blueprint confirmed at its five-yearly congress, it said it would boost its growing role as a key manufacturing hub for global giants like Samsung Electronics Co and Intel Corp. The Hanoitimes – It is vital for Vietnam to further boost the development of private sector and public investment funds, in turn contributing to economic growth and creating the foundation for long-term development. Vietnam Investment Review under the Ministry of Planning and Investment Licence No. [69][circular reference], During the COVID-19 pandemic, Vietnam has suspended issuance of all tourist visa since March 2020, as of September 2020, the country is still closed for foreign tourists,[70] with plans to reopen for tourism from a limited number of Asian countries. Chinese noted that the Vietnamese were doing business just like the same with in the Chinese Song dynasty. In the World Bank's Ease of Doing Business rankings,[111] Viet Nam also rose from 104th place in 2007 to 68th place in 2017. With no reopening for tourists in sight, the government has called for the promotion of domestic tourism. • It is not an economy managed according in the style of a centralized bureaucratic subsidized system [27][28], According to a forecast by PricewaterhouseCoopers in February 2017, Vietnam may be the fastest-growing of the world's economies, with a potential annual GDP growth rate of about 5.1%, which would make its economy the 20th-largest in the world by 2050. [48] The percentage of respondents with health insurance increased from 74% in 2016 to 81% in 2017, with strongest gains in the rural population groups. The EU is second with US$27.9 billion, ASEAN is third, China is fourth and Japan is the fifth largest export market of Vietnam. From 1993 through 2004, Vietnam received pledges of US$29 billion of official development assistance (ODA), of which about US$14 billion, or 49%, has been disbursed. SLOOINP; ISSN No. The overall impact of these efforts was the lowering of tariffs on both imports and exports to and from Viet Nam, and an improved trade balance with a surplus of $2.8 billion during the first eight months of 2018 (Vietnam Custom Department). Vietnam tied with several nations for the 102nd place in Transparencies International's Corruption Perceptions Index in 2004. In 2004, international donors pledged ODA of US$2.25 billion, of which US$1.65 billion actually was disbursed. Source: tradingeconomics.com. On January 11, 2007, Vietnam officially became the WTO's 149th member, after 11 years of preparation, including eight years of negotiation. This has resulted in rapid economic growth. Comparison of Vietnam’s economic growth with ASEAN-6 countries The study concluded that the propensity of foreign firms to bribe at entry is higher in restricted sectors. To tackle this, govt introduced forced savings which can be understood as the accumulation of unspent money to make the monetary overhang. Following 6.8 percent growth in 2017, preliminary data indicate that GDP growth accelerated to 7.1 percent in 2018, underpinned by a broad-based pickup in economic activity. Vietnam’s growth would be among the highest in the world, thanks to its successful containment of the Covid-19 pandemic, Era Dabla Norris, mission chief to Vietnam and division chief in the IMF’s Asia and Pacific department, said at the end of her team’s virtual mission to Vietnam from October 15 to … Total trade reached US$228.13 billion, an increase of 12.1% from 2011. Although the United States and Vietnam reached a landmark bilateral agreement in December 2001, which helped increase Vietnam's exports to the United States, disagreements over textile and catfish exports are hindering full implementation of the agreement. Industry in the South consisted mostly of food-processing plants and factories producing consumer goods. In 2003, the total catch was about 2.6 million tons. For example, VietinBank is currently owned by Bank of Tokyo Mitsubishi UFJ (20%) and International Finance Corporation (10%) while Vietcombank is owned by Mizuho (15%). The economy growth in the fourth quarter of this year, however, remains significantly lower than an expansion of 6.79 percent recorded at the same period last year, before the pandemic. In 1997, the ban was extended to all timber products except wooden artifacts. PAPI found that bribery at public district hospital services decreased from 17% in 2016 to 9% in 2017. The largest sector by far for licensed FDI is industry and construction. Gold still maintains its position as a physical currency to a certain extent, although it has seen its economic role declining in recent years.[74]. This has been notably evident with the role of women participating in the economy. The Inclusive Development Index[112] by WEF put Vietnam in a group of countries that have done particularly well and advancing in the ranking of the world's most inclusive economies. Vietnam Economic Outlook. Socialist-oriented market economy has been formed and macro economy stabilized: Soundly developing economy and dealing with social issues, so the life of the majority of people has been improved. The feudal dynasties always considered agriculture as the main economic base, and their economic thoughts have been predicated on physiocracy. This is because our country is in the period of transition to socialism, and there is still a mixture of, and a struggle between, the old and the new, so there simultaneously are, and are not yet sufficiently, socialist factors”, Over the past 30 years, Vietnam has signed numerous trade agreements with different partners, promoting the country as one of the main manufacturing hubs in the world. According to Ralph Jennings, Vietnam has been privatizing many of its state-owned operations to reduce corruption and increase efficiency. Barriers to trade and intellectual property are also within the purview of bilateral discussions. "Report paints brighter picture of corruption control in Vietnam - VnExpress International", "Vietnam's Corruption Crackdown Is All About Protecting Its Economic Miracle From Its SOEs", "Vietnam's economy expands 7.38%, best rate in a decade, Government & …", "Vietnam, Asia's newest 'tiger' economy, roars in 2018: QNB", "Vietnam's Economy Could Soon Be Bigger Than Singapore's", "Report for Selected Countries and Subjects", "World's Top Exports - Coffee Exports by Country", "What did Viet Nam export in 1996? [61] In the past decade, a significant automotive industry has been developed. The growth is mainly attributed to the strength of its manufacturing sector along with the increasing spending power of its population. [29] Vietnam has also been named among the Next Eleven and CIVETS countries. Destruction caused by the Second Indochina War from 1954 to 1975 seriously strained the economy. This article investigates this claim for the case of Vietnam. Growth factors. Manufacturing rose 7.12 percent, services advanced 3.27 percent and agriculture went up only 0.08 percent. Vietnam races ahead of China in economic growth: opportunities and challenges for Vietnam in the post-COVID- 19 period July 21, 2020, 3:58 PM IST SD Pradhan in Chanakya Code , politics , World , TOI From 1994 to 2004, the industrial sector grew at an average annual rate of 10.3%. Trading Economics members can view, download and compare data from nearly 200 countries, including more than 20 million economic indicators, exchange rates, government bond yields, stock indexes and commodity prices. Textiles and garments are still an important part in Vietnam's export, valued about US$17.9 billion in 2013. [24], Despite the reforms, the Vietnamese economy remains in many ways influenced by socialism; the economy is dominated by the state, with the state owning most major businesses,[25] price controls remain in place over many essential goods and foodstuffs,[26] and there are over 25,000 worker-owned cooperatives in Vietnam, with the agriculture industry being particularly dominated by the cooperative sector, at the state's encouragement. The 5 Engines That Guarantee Vietnam More Fast Economic Growth … Primary and secondary enrollment rates for boys and girls are also essentially the same, and more girls continue studying in high school than boys. Socialist-oriented market economy has been formed and macro economy stabilized: Soundly developing economy and dealing with social issues, so the life of the majority of people has been improved. Compare to other developing countries, the economic growth in Vietnam was considered to be fairly inclusive and equitable. Almost all Vietnamese enterprises are small and medium enterprises (SMEs). Yet, in the past six years the growth in services outpaced significantly all other sectors, and today services account for 37 percent of GDP. [48], In 2017, Transparency International, a non-profit that tracks graft ranked Vietnam as 113th worst out of 176 countries and regions for perceptions of corruption. [39], Crude oil was Vietnam's leading export until the late 2000s, when high-tech electrical manufactures emerged to become the biggest export market (by 2014, crude oil comprised only 5% of Vietnamese exports, compared to 20% of all exports in 1996). [87], Economic relations with the United States are improving, but are not without challenges. In Vietnam, industry and construction constitute the biggest sector of the economy (41 percent of total GDP). The National Party Congress approved a 10-year... Digital economy and manufacturing priority for government. Tariffs applied by Vietnam as provided by ITC's, Officially the Republic of China, participates as ", This page was last edited on 4 March 2021, at 18:06. In 2002, Vietnam brought ashore 2.26 billion cubic meters of natural gas. [36], The separation distorted the basic Vietnamese economy by overly stressing regional economic differences. In 2004, Vietnam confirmed plans to build a nuclear power plant with Russian assistance,[39] and a second by a Japanese group. Five charts tell the story: Extensive market reforms since the dawn of the doi moi era in 1986, and strict commitment to macroeconomic stability more recently, have laid the ground work for rapid, inclusive growth that averaged 6.6 percent per annum during 2014–18 and reached a 10-year high of 7.1 percent in 2018. Under a recently-adopted plan by the country's top legislature, Vietnam will strive to achieve a GDP growth of around 6 percent in 2021 while effectively combating the COVID-19 pandemic. This was necessary, given the country's export-led growth strategy, where literacy for the mass workforce is deemed important for growth in the manufacturing sector. Common obstacles come from culture, transparency and legal aspects. Some economists claim that economic growth sometimes leaves the poor behind (see a discussion of this in Winters, McCulloch, and McKay [2004]). [72] Total tourism revenues dropped by over 60% year-on-year for July 2020.[73]. [39], Throughout the 1990s, exports increased by as much as 20% to 30% in some years. Other sectors attracting FDI are oil and gas, fisheries, construction, agriculture and forestry, transportation and communications, and hotels and tourism. The country posted an economic growth rate of 2.12 percent in the first nine months of this year, the lowest rate in the past decade, according to its General Statistics Office. Vietnam invested a lot in its human capital and infrastructure. The government has made real effort in changing its mindset toward a more open market economy, lowering the cost of doing business, and putting regulation in place to ensure rights and orders. [89] Vietnam's main export market included the EU with US$20 billion, United States with US$19 billion, ASEAN with $US 17.8 billion, Japan with US$13.9 billion, China with US$14.2 billion, and South Korea with US$7 billion.[97]. In 2000, 22.4% of industrial production was attributable to non-state activities. [78] Mergers and acquisitions have gradually become an important channel of investments in the economy, especially after 2005. [52], The following table shows the main economic indicators in 1990–2019. Vietnam … Direct access to our calendar releases and historical data. Oil production rose rapidly to 403,300 barrels per day (64,120 m3/d) in 2004, but output is believed to have peaked and is expected to decline gradually. In 1986, Vietnam launched a political and economic renewal campaign (Đổi Mới) that introduced reforms to facilitate the transition from a centralized economy to a "socialist-oriented market economy". [49][undue weight? In peaceful times, soldiers were sent home to do farm work. 87 /GP-BTTTT International reg: Registered as a newspaper at the Post Office, London, Serial No. Government spending and debt remained in check and bank capital rules were strengthened. By the end of 2013, the government is expected to privatize 25–50% of SOEs, only maintaining control on public services and military. In 2004, external debt amounted to US$16.6 billion, or 37% of GDP. Publish your articles and forecasts in our website. USD. ... Vietnam, with a population of more than 90m, has notched up the world’s second-fastest growth rate per person since 1990, behind only China. The guideline to develop a multi-sector economy has been carried out effectively. Vietnam's gross domestic product advanced by 3.82 percent year-on-year in the first quarter of 2020, following a downwardly revised 6.79 percent growth in the previous period. The World Bank noted that between 1990 (USD 6.472 billion) and 2016 (USD 205.276 billion), Vietnam’s GDP grew by a whopping 3,303% making it the second-fastest growth rate worldwide, only surpassed by China. Inflation below 5% is in green. Current economic risks relate to geopolitics, trade policy uncertainty, and domestic reform implementation. [36], After reunification in 1975, the economy of Vietnam was plagued by enormous difficulties in production, imbalances in supply and demand, inefficiencies in distribution and circulation, soaring inflation rates, and rising debt problems. [41] The MFA placed restrictions on the import by industrialized countries of textiles from developing countries. The situation was worsened by the country's 1.5 million military and civilian deaths, and the subsequent exodus of 1 million refugees, including tens of thousands of professionals, intellectuals, technicians and skilled workers. (NOTE: Exchange rates as of 30 December 2016. [48] Reports of land seizures went down from an average of about 9% before 2013, to less than 7% in 2017. External debt, foreign aid and foreign investment, Economic indicators and international rankings. Vietnam has also developed a National Action Plan to review current growth policies and update these to align with the interest of the SDGs. The economy of Vietnam is a socialist-oriented market economy, which is the 36th-largest in the world as measured by nominal gross domestic product (GDP) and 23rd-largest in the world as measured by purchasing power parity (PPP). [40] By the late 1990s, the success of the business and agricultural reforms ushered in under Đổi Mới was evident. The percentage of the poorest Vietnamese respondents who believed that their economic situation would worsen increased from 13% in 2016 to 26% in 2017. In 2005, the seafood industry began to focus on domestic demand to compensate for declining exports.
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