Vietnam economy

War-nostalgia no cure for ailing Vietnam economy

Motorcyclists pass a poster marking the 40th anniversary of the US Christmas bombing campaign, Hanoi, Vietnam, December 21, 2012. For years the country's leaders have leant on war-era nostalgia to shore up authority but now face a modern-day threat -- anger over the economy.

An employee prepares a funeral wreath for a customer in Hanoi on December 21, 2012. For years the country's leaders have leant on war-era nostalgia to shore up authority but now face a modern-day threat -- anger over the economy.

Posters of US bombers crashing in flames festoon Hanoi to mark another anniversary in a long-finished war, December 21, 2012. But behind the usual propaganda Vietnam's rulers face a modern-day threat -- anger over the economy.

AFP - Posters of US bombers crashing in flames festoon Hanoi to mark another anniversary in a long-finished war. But behind the usual propaganda Vietnam's rulers face a modern-day threat -- anger over the economy.
For years the leaders of the one-party state have leant on war-era nostalgia to shore up authority anchored in battlefield victories.
With the state-dominated economy floundering, experts say touting decades-old military successes is no longer enough to shield the regime from growing public frustration.
"The communist party is skating on thin ice," said David Koh, a Vietnam analyst from the Institute of Southeast Asian Studies in Singapore.
"They must expect newer generations to look beyond these great moments of the past in deciding whether their political system is worth supporting."
A key way to strengthen the party's legitimacy would be through serious economic reforms, Koh told AFP.
Despite tight controls over the media and demonstrations there are signs of rising public dissatisfaction -- from a growing chorus of online criticism to daily, if small-scale, protests over corruption and land disputes in Hanoi.
"The government should spend less time and money on celebrating historic events and pay more attention to improving people's lives," retired state official and ex-soldier Tran Van Duong, 65, told AFP.
"Everyone seemed to earn less this year, everyone is complaining. People are not happy with the government's performance," he said, as the city marks the 40th anniversary of the 1972 "Christmas Bombings".
The aerial bombardment saw American B-52s and other aircraft drop 20,000 tons of bombs on or near Hanoi after peace talks with North Vietnam broke down.
Once touted as the next "Asian Tiger", Vietnam's economy has run aground -- its banking system drowning in toxic debts, foreign direct investment down sharply and dozens of major state-owned companies hovering near bankruptcy.
From exorbitant healthcare costs and substandard education to traffic congestion, experts say the deep flaws in Hanoi's version of state-mandated capitalism are surfacing in all areas of daily life.
"The formal political system doesn't work.... You can't run a country like this. It is sclerotic," said Adam Fforde, a professorial fellow at the Centre for Strategic Economic Studies at Victoria University in Melbourne.
"People have lost confidence in the idea that there is somebody there who can pull levers and make things happen," he said.
Over the past 20 years, Vietnam has used a Chinese-style mix of free markets and authoritarian governance to achieve rapid growth, but experts say deeper economic as well as political reforms are needed.
The current economic sluggishness is intensifying pressure on the leadership. Around a million young people enter the workforce each year and economists warn job creation and skills training are not keeping pace.
"The state apparatus is in a bit of a stupor," said Jonathan London, an assistant professor in the Department of Asian and International Studies at City University of Hong Kong.
Despite being a one-party state, Vietnam has an "extremely fragmented power structure" within its vast communist apparatus, which means tough decisions are often not taken when needed, he said.
From the World Bank to party economists, there is widespread recognition of what needs to be done to lift competitiveness and boost GDP growth that was this year the weakest since 1999.
Reform the state sector, recapitalise banks and tackle corruption or "the dream of the economic miracle in Vietnam, which seemed like such a sure and palpable thing 10 years ago, will continue to dissipate," London said.
The communist party itself seems aware of the problems -- at a plenum in October mistakes were admitted in the stewardship of the economy but no officials were sanctioned.
Vietnam needs leaders who can stop powerful interest groups -- from the military to the major state-owned enterprises down to provincial officials -- running amok, in order to get the economy back on track, London said.
"It is not clear who is capable of doing such a thing," he added.
Instead, Vietnam is stuck with "a sort of corrupt, patrimonial style of rule that leads to Bentleys and Rolls-Royces on the one hand, and tens of millions of people who aren't doing so well on the other", London said.

Vietnam looking at weak banks bad debts

Vietnam orders public list of weak banks as bad debts mount 

Last Updated: Wednesday, August 01, 2012 01:00:00

 

Vietnam’s Prime Minister Nguyen Tan Dung ordered a public list of weak banks and details of lenders’ non-performing loans as the government seeks to tackle bad debt that’s undermining the banking system and hurting businesses.

The central bank is drafting detailed measures to check bad debt, Nguyen Thi Hong, head of monetary policy at the State Bank of Vietnam, said at a briefing in Hanoi on July 31. The monetary authority needs to “quickly restructure banks’ debt, reduce bad debt by comprehensive measures and restructure weak banks” to minimize any potential risks to the system, according to the order posted on the government website yesterday.

Vietnam has struggled with stagnant lending and high inflation that has crimped corporate growth and domestic demand. The monetary authority has cut interest rates for five straight months this year and ordered lenders to reduce rates on loans to companies, while the government has pledged to speed up restructuring of weak commercial lenders and non-performing loans. Bad debts rose to 4.47 percent of total lending as of May 31 from 3.07 percent at end-2011, according to the central bank.

“The high bad-debt ratio at banks is a worrying problem,” Nguyen Duc Hai, Ho Chi Minh City-based portfolio manager at Manulife Asset Management, said by phone on July 30. “Rising bad debt has become a large burden on banks and hindered them from giving more loans.”

The benchmark VN Index on the Ho Chi Minh City Stock Exchange slipped 0.4 percent as of 10:35 a.m. local time. Bank stocks fell, with Joint-Stock Commercial Bank for Foreign Trade of Vietnam, the nation’s largest-listed company and second- biggest listed lender by market cap, sliding 1.4 percent, and Saigon-Hanoi Commercial Joint-Stock Bank losing as much as 2.3 percent. The dong eased 0.1 percent to 20,880 against the dollar.

Significantly understated

RELATED CONTENT

Interest rate cuts continue amid easing inflation Sluggish credit growth 'a blessing in disguise' Buying bad debt won’t be too costly: official Vietnam central bank says bad debt 8.6 pct at end-March Like us on Facebook and scroll down to share your comment

State Bank of Vietnam Governor Nguyen Van Binh said in April bad debt may be “much higher” than the reported figures at some banks. Bad debt continues to be on an “uptrend,” Vu Duc Dam, chairman of the government office, said on July 31.

Vietnam’s government said earlier this year it may establish a company to buy bad debt from banks to strengthen their balance sheets and enable them to step up lending. The aim is to cut the bad-debt ratio at state-owned banks to below 3 percent by 2015, according to the March 2 statement.

Non-performing loans are “significantly understated” and could be three or four times higher than the official estimates, Fitch Ratings said in a March report.

Vietnam’s lending grew 0.93 percent at the end of July, compared to the end of 2011, the government said in a release at yesterday’s briefing. Consumer prices may fall in August compared to July on lower food and fuel prices, Dam said.

Loan demand

While easing inflation has given the central bank room to cut interest rates, lenders have faced lower demand for loans as the economy grew 4.66 percent in the three months to June from a year earlier. Deputy Prime Minister Vu Van Ninh has said full-year expansion may fall below the government’s 6 percent target.

More than 30,300 companies closed permanently or suspended operations in the first seven months of the year, up 6.4 percent from a year earlier, according to a statement on the government website on July 31. A purchasing managers’ index for Vietnam fell to 43.6 last month from 46.6 in June, HSBC Holdings Plc and Markit Economics said today. A number above 50 indicates growth.

The central bank has said it aims to boost lending growth to as much as 10 percent in the second half of the year from 0.76 percent in the first six months.

Dong deposit rates at commercial lenders could drop to below 8 percent if inflation eases to less than 7 percent at year-end, Binh said July 29, even as the monetary authority has resisted calls from businesses to cut borrowing costs further.

Rates on some preferential loans may drop to below 10 percent in 2013 if deposit rates fall, Binh said.

Vietnam’s income per capita far lagging behind regional countries | Look At Vietnam

Vietnam’s income per capita far lagging behind regional countries

April 3, 2012

LookAtVietnam – The average income per capita of Vietnamese people is
still far lagging behind the income per capita in ASEAN countries and China,
though the income has been increasing considerably in the last years as a result
of the doi moi (renovation) period.

Vietnamese still poor…
Meanwhile, the scenario that Vietnam can catch up with China and other
ASEAN’s economies would still be a far away dream, if Vietnam lacks the driving
force for reform.
This is the warning released by a scientific research work at the national level
carried out by the Hanoi Economics University. The research work was conducted
at the request of the National Assembly’s Economics Committee, which cited the
figures about the income per capita in Vietnam and in other regional countries
released by the International Monetary Fund (IMF) in 2010.
If considering the exchange rate, the GDP per capita increased from 114 dollars
in 1991 to 1061 dollars in 2010. Meanwhile, China’s GDP per capita increased
from 353 dollars to 3915 dollars during the same time.
As such, the income per capita of Vietnamese people, which was equal to 32
percent of China’s, then dropped to 27 percent in 2010.
If considering the PPP (purchase parity power), the GDP per capita in Vietnam
was 706 dollars in 1991 and then increased to 2948 dollars in 2010. During the
same time, the figures in China rose from 888 dollars to 6786 dollars.
As such, the income per capita in Vietnam was equal to 80 percent of Chinese in
1991, but the figure dropped to 43 percent in 2010.
If comparing with other ASEAN countries, though the gap between Vietnamese and
ASEAN income per capita has been narrowed in the last 20 years, the gap is still
big at this moment.
Thoi bao Kinh te Saigon quoted Dr Pham Hong Chuong from the Hanoi Economics
University as saying that Vietnam’s GDP per capita in PPP was less than a half
of that of the Philippines or Indonesia, 1/5 of Thailand, 1/10 of Malaysia in
1991.
The figures then exceeded the thresholds of ¾, 1/3 and 1/5 of the above said
countries after nearly 20 years.
In general, Vietnam’s GDP per capita in 2010 was 1061 dollars by exchange rate
and 2948 dollars by PPP, which, according to Chuong, are far below the average
levels in Asia and the world.
After more than a quarter of a century of renovation, Vietnam has escaped from
the group of countries with low income to the group with medium income, in
accordance with the World Bank’s standards.
However, according to Chuong, Vietnam’s economic growth still cannot show the
strong determination and its capability to escape from the risk of lagging
behind in the development.
The report also showed the unemployment rate of 4.6 percent in urban areas and
20 percent in rural areas, which means that over 10 million workers stay
unemployed in Vietnam.
In fact, the fact that Vietnam’s income per capita is outdistanced by regional
countries is not a new story.
The 2009 Vietnam Development Report of the World Bank showed that Vietnam’s
income per capita was behind by 51 years in comparison with Indonesia, 95 years
with Thailand and 158 years with Singapore.
… but spend money like water
The fact that Vietnamese are extravagant consumers has become well-known in the
world. Nguyen Tran Bat, a well-known economist, said on Doanh Nhan that his
foreign friends, including billionaires, many times expressed their surprise
about the spending money like water of Vietnamese people.
A friend of Bat’s, a French professor, who arrived in Vietnam in 1970s, saw a
taxi driver smoking a 555 cigarette and asked how many 555 cigarettes could he
buy with his salary. The driver said that his salary was just enough to buy 3-4
cigarettes only. The French professor then said that Vietnamese people even
spend more than American.
C. V

VietNamNet - Vietnam’s economy in 2011: the impressive figures | Vietnam’s economy in 2011: the impressive figures

Vietnam’s economy in 2011: the impressive figures

VietNamNet Bridge – The Vietnam Economic Forum VEF of VietNamNet reviews the 10 most impressive figures associated with the most important events that had big impacts on the national economy in 2011.

1. The record high inflation rate of 18 percent

The consumer price index CPI in 2011 increased by 18.13 percent over 2010’s, which is among the highest inflation rates in the world.

In late 2010, the National Assembly decided that the CPI increase in 2011 must not be higher than 7 percent. The goal was then raised in June 2011 to 17 percent

The government has determined to force the inflation rate to 9 percent in 2012.

2. The record dong devaluation of 9.3 percent

On February 11, 2011, the State Bank of Vietnam raised the interbank exchange rate by 9.3 percent, the highest ever dong devaluation. The move aimed to narrow the gap in the dollar price between the official and the black markets.

The State Bank has been applying drastic measures to put the dollar black market in order. Meanwhile, it has threatened to heavily punish the enterprises which quote prices in dollars.

3. 20 percent – the peak deposit interest rate

Though the State Bank stipulated that commercial banks must not pay more than 14 percent per annum in interest rate for deposits, the banks ignored the regulation. Some banks even paid 20 percent per annum for deposits in order to attract depositors. Meanwhile, the lending interest rate was pushed up to 24 or 25 percent, which caused big difficulties for enterprises.

The State Bank then had to apply the “iron discipline” to put everything in order, threatening to dismiss bank directors, if the banks continued breaking the laws and paying high interest rates, which it believed would distort the monetary market.

4. 49 million dong - the record high in the gold market’s history

The gold price in Vietnam began escalating in early August. At first, the gold price escalated to 42-45 million dong per tael. After that, the gold fever attack boomed on August 23, 2011, when the gold price climbed to its peak of 49 million dong per tael, and people rushed to purchase gold for fear that the price would continue rising.

In order to ease the fever, the State Bank decided to sell gold reserves and granted quotas for importing gold.

5. 1000 tons of gold kept among people

The National Finance Supervision in June 2011 announced a shocking figure: the volume of gold kept among people may reach one thousand tons, which is worth 45 billion dollars, a huge capital.

Experts say that it is a great waste that the volume of gold is still being kept at the coffers, while it has not been put into business to make profits.

6. Tax agencies collect 3 trillion dong in tax arrears from auto companies

Honda, Ford, Toyota and GM Daewoo once faced the risk of paying tax arrears worth of trillions of dong. Under the current regulations, if just a part of the sets of car parts imported to Vietnam for local assembling, cannot meet the requirements on the separation level in accordance with the Decision 05, the importers (here auto manufacturers) have to bear the tax rate applied to the complete built unit (CBU) cars of 72-82 percent.

However, the auto manufacturers luckily got out of danger after they appealed to the Prime Minister.

7. Nearly 50,000 businesses got bankrupted in 2011

According to the Ministry of Planning and Investment, by September, nearly 50,000 businesses had stopped operation, stopping paying tax, got dissolved or bankrupted.

The figure represents an increase of 11,000 businesses in comparison with the previous year.

8. Public debt climbs to nearly 50 percent of GDP

According to the Ministry of Finance, the public debt has reached 1375 trillion dong, equal to 58.7 percent of the 2011’s GDP. Meanwhile, the proportions were just 33.8 percent in 2007 and 56.6 percent in 2010.

Experts have warned that if the public debt increases to 70 percent, Vietnam may fall into a crisis.

9. EVN reports the record loss of 10,162 billion dong

The figure was released by the Ministry of Industry and Trade on November 19. The State Audit has affirmed that EVN takes profit because of the bad management.

The noteworthy thing that despite the big loss, EVN’s worker still has the high average wage of 7.3 million dong.

10. Three banks merge

Ficombank, Tin Nghia Bank and Saigon Bank have agreed to merge into Saigon Bank which will officially operate from January 1, 2012.

VEF

Hanioan stay home curbing expenses for festivals

VietNamNet
Bridge – Though the four-day April 30 holiday is long, many Hanoians would
rather stay at home rather than taking tours, because they have decided to curb
expenses in the price storm.

It’s not the right time to travel

With the
total income of 20 million dong a month, previously, Mai and her husband always
had enough money to cover all expenses of the three-member family and reward
themselves with attractive tours on holidays.

However,
over the last year, though their income remains unchanged, the prices of goods
and services has increased by two fold. The “price storm” has frightened Mai.

“The prices
increased many times previously, but they did not affect my family, because
with the income of 20 million dong, we were considered high income earners.
However, the latest sharp price increase has forced me to change the way I
spend,” Mai complained.

In fact,
Mai and her husband still have money to pay for a tour on April 30 holiday.
However, Mai has decided to stay at home. “The petroleum price has increased
sharply by 6000 dong per liter just within one month. Meanwhile, petroleum
distributors still incur losses. I am afraid that the petroleum prices will
increase further, thus leading to price increases of a lot of other products,”
she said. “Therefore, it would be better to cut down expenses beginning right
now”.

“By staying
at home, we would save nearly 10 million dong,” Mai estimated.

Tour fees on the rise, tourism sites
not attractive

Hung, who
lives on Hang Dao street,
said that he always traveled on long holidays, but he does not intend to go
anywhere this April 30 holiday.

Hung has to
change his habits because the tour fees have increased too sharply. He has been
told by travel firms that the tour fees have increased by 15-30 percent,
because the transportation fee, hotel room rates and other service fees all
have increased.

In fact,
there is another reason that has led to the decision to stay at home. Hung said
that tourism sites are always very crowded on holidays. Therefore, Hung does
not feel good when traveling to the sites: he always has to watch out for his wallet
because of theft.

“Travelers
spend money to relax. However, in fact, they cannot relax on holidays, because
they have to elbow through crowds and struggle with pickpockets and robbery,”
Hung said. “Besides, many tourism sites have become uninteresting, and I don’t
know what to do except sightseeing”.

A difficult period for travel firms

Even
Vietravel, a big travel firm, also complained that it is really difficult to do
business now.

Nguyen Minh
Man, a senior executive of Vietravel, said the number of travelers on Hung King
Death Anniversary and April 30 holidays is estimated to increase by 20-25
percent only, much lower than the expected level of 35 percent.

Nguyen Hai
Quan from AMI Travel Firm, also complained that there are not many travelers as
expected. Quan said his firm has to raise prices by five percent, but the price
increase is not big enough to make profit because the coach leasing fee has
increased by 25 percent, while hotel room rate has increased by 20 percent and
meal services have increased by 5-10 percent.

“Especially,
many hotels and restaurants have not fixed prices because they are still
listening to the news for updates,” Quan said.

Meanwhile,
Man from Vietravel said Vietravel has raised the tour fees by 10 percent after efforts
to negotiate with partners to stabilize service fees. Though the 10 percent
increase is modest, Vietravel cannot set higher fees because it wants to retain
travelers.

N. Yen

The six most impressive figures of Vietnam’s economy in 2010 | Look At Vietnam - Vietnam news daily update

VietNamNet Bridge – The year 2010 finished with the record numbers of garment and rice export turnovers and the number of foreign tourists as reviewed by Tuoi tre.

6.9 million tons of rice exported

According to the Ministry of Agriculture and Rural Development, Vietnam exported 6.88 million tons of rice in 2010, reaping $3.23 billion in turnover. The figures represent the 15.4 percent increase in quantity and 21.2 percent increase in export turnover in comparison with 2009. 2010 was also the year which had the highest volume of exports and highest export revenue so far.

However, the high export volume did not mean that farmers and export companies generated high profit. The rice price fluctuated so heavily in 2010 such that both enterprises and farmers suffered. The summer-autumn crop price dropped to 3000 dong per kilo, but farmers still had to sell rice because they did not have enough storage. When the rice price later surged to 6500 dong per kilo, they did not have more rice to sell.

Meanwhile, a lot of enterprises have also reported losses because they signed export contracts in mid-year at low prices ($300 per tone). However, when collecting rice from farmers to fulfill the export contracts, they had to pay high prices due to price increases.

$11 billion worth of garment exports

With an export revenue of $11 billion, garment has become the export item which has the highest export turnover among the 26 main export items of Vietnam.

According to Vu Duc Giang, Chair of the Vietnam Textile and Apparel Association, the sum of money that garment companies can pocket after paying for expenses has increased by 18 percent, reaching $4.5 billion.

Many garment companies made breakthroughs in seeking new export markets and have reported high profits. For example, Phong Phu International Company, reported an impressive growth rate of 248 percent in 2010, while Viet Tien Corporation had the leading export turnover of over $200 million.

To date, many garment companies have received orders that will bring enough jobs until the third and fourth quarters of 2011. Vietnam strives to see the growth rate of 10-15 percent in 2011.

5 million foreign tourists

 For the first time Vietnam has received a record high number of foreign tourists in 2010 – 5 million tourists, an increase of 1.2 million compared to 2009. The revenue from tourism in 2010 is estimated to reach 96 trillion dong, up by 37 percent over 2009.

General Director of the Vietnam Tourism Administration of Tourism Nguyen Van Tuan believes that the number of foreign tourists will be higher in 2011 than in 2010. However, he thinks that the growth rate would not be as high as in 2010 for three reasons. First, Vietnam will not have big events in 2011 like it did in 2010. Second, Northeastern Asia, a potential market of Vietnam, shows latent political uncertainties. And third, in 2011, Vietnam will focus on heightening the quality and efficiency of tourism, while trying to improve service professionalism.

228 trillion dong poured into real estate

Though the real estate market was gloomy in 2010, outstanding loans to fund real estate trading deals in 2010 still increased by 23.5 percent over 2009, reaching 228 trillion dong, according to the State Bank of Vietnam.

Several new real estate projects were kicked off in 2010. Meanwhile, due to lack of capital; many real estate developers have been relying on bank loans to develop the projects. Moreover, real estate developers could not put high hopes on the stock market, which was very quiet in 2010.

Top 10 stock millionaires hold 48,400 billion dong worth of stocks

Pham Nhat Vuong has been recognized as the richest stock millionaire with the total stock assets of 16 trillion dong. Vuong is the Chair of Vingroup. The second position is being held by Doan Nguyen Duc, Chair of Hoang Anh Gia Lai Group with assets worth 11 trillion dong.

The 10 richest stock millionaires in Vietnam are holding total assets worth 48,400 billion dong.

$11 billion was the FDI capital disbursement

The Foreign Investment Agency has announced an impressive figure of foreign direct investment (FDI) investment - $11 billion.

This has been described as a breakthrough in Vietnam’s FDI attraction. In previous years, the volume of FDI registered capital was always higher than the disbursed capital.

At the same time, some FDI super projects had their licenses revoked due to the investors’ tardiness in implementing projects.

Source: Tuoi tre

HCM City targets 10% growth | Look At Vietnam

HCM City aims to achieve a Gross Domestic Product growth rate of at least 10 per cent next year.
HCM City is still the country’s biggest economic and service hub. The city aims to achieve a Gross Domestic Product growth rate of at least 10 per cent next year.
The target is one of the 22 points of an ambitious socio-economic development blueprint for 2010 announced by the city People’s Committee yesterday, December 28. The points include six for economic development, eight for social affairs and eight for environment-related issues.
Other important economic goals are export value growth of 12.7 per cent and a total of VND172 trillion (US$9.3 billion) in social development investment capital, accounting for 41.8 per cent of the GDP.
The city aims to keep the consumer price index (CPI) under 7 per cent while reducing its unemployment rate to less than 5.1 per cent and poverty rate to 7.2 per cent.
About 96 per cent of the city’s urban population will get access to clean water while this rate would be 85 per cent in rural areas, according to the plan, and all major acts of environmental pollution will be strictly penalised.
The points also include standard wastewater treatment systems for all city industrial parks and export processing zones.
According to Mayor Le Hoang Quan, to achieve the goals set, the city will focus its economy on services, industry and agriculture.
For the service sector, the most competitive and highest value added services will be given priority, while various economic sectors will be encouraged to invest in services to make them more efficient.
Diversifying domestic tourism products and creating new tourist destinations are still on the agenda to help reach the target of 3.5 million foreign tourists to the city (up 11 per cent), and 6 million domestic tourists (up 13 per cent) in 2010.
Increasing trade promotion at overseas markets, which have larger purchasing powers, and improving competitiveness will aid local enterprises to find larger market shares at home and abroad.
The blueprint signals more attention to develop the construction industry and the building material production industries, as they have potential to boost the city’s industrial production value.
Intensive investments into top value-adding high-tech industries and farming technology are also on the list.
The city would continue its investment in a high-tech agriculture park and research into developing it into a large-scale seedlings development centre to supply the whole region, Quan said.
The city’s socio-economic achievements in 2009:
- GDP growth rate: 8 per cent- Total budget revenues: VND128.47 trillion, up 3.8 per cent- Per capita GDP: over VND46.3 million, up 21.1 per cent.- Export value: US$12.1 billion, up by 1.3 per cent- Retail sales and service turnover: VND291.59 trillion, up 19.2 per cent.- Transport service: up 17.9 per cent - Industrial production value: up 6.3 per cent- Agriculture-forestry-fisheries production value: up 2.7 per cent.- 289,600 new jobs created- Crime rate: down 10 per cent- Tourists: 10.52 million
Creating a transparent, open and fair business environment remains to be a target in the next year with more simplified administrative procedures to boost trade and combat corruption.
The city would also place controls on prices and activities of finance, monetary, real estate, securities and gold markets, he said.
The role of state management in environmental affairs will be strengthened to minimise damages caused by global climate change, according to the plan. The city will also increase investment to realise more social security policies and poverty reduction programmes.
In 2010, the city hopes to attain total budget revenues of VND144.3 trillion (US$7.80 billion), up by 17.88 per cent from 2009 with VND14 trillion (nearly $760 million) being planned for investment development activities.
Continuous growth
This year, despite the impact of the global economic recession, HCM City has managed to fulfil 18 out of its 20 set goals for social economic development.
With the whole year economic growth rate of 8 per cent, high capital mobilisation and more investors, HCM City ranks 13th out 63 provinces and cities nationwide in terms of competitiveness.
VietNamNet/Viet Nam News

Vietnam Healthy ..Despite deficit fears

Vietnam healthy despite deficit fears

Vietnam’s external position is “fairly healthy,” in spite of market concerns about the country’s trade deficit, Barclays Plc said.

Vietnam’s economy has “all the hallmarks” of an emerging markets crisis, with growth poised to overheat as inflation quickens and foreign-exchange reserves fall, Nomura Holdings Inc. said this month. A decline in the reserves to less than three months of import cover increases the risks of a balance of payments crisis, Moody’s Economy.com said this month. The recent widening in Vietnam’s monthly trade deficit is making investors “nervous,” London-based Barclays said in a note received Monday. The shortfall rose 23 percent in November from October to the highest monthly figure since the first half of 2008, according to figures from the General Statistics Office. “The trade deficit is going to worsen but fundamental flows such as foreign direct investment and remittances should more than cover the shortfall,” wrote Prakriti Sofat, a Singapore-based economist at Barclays Capital. “Official development assistance flows should also pick up.” The Consultative Group on Vietnam, which is comprised of countries led by Japan and agencies led by the World Bank, this month pledged more than US$8 billion in grants and low-interest loans for the Southeast Asian country, an increase of at least a third from the figure announced a year ago at an annual meeting in Hanoi. While imports of consumer goods such as autos have been picking up, a “booming” construction sector in Vietnam is driving other purchases of overseas goods, Sofat wrote. Machinery, steel “Imports such as machinery and steel are supported by strong foreign direct investment and construction,” Sofat wrote. The purchase of machinery by Vietnam has been helping drive “healthy” industrial production in the country, Ho Chi Minh City-based fund manager VinaCapital Investment Management Ltd. said Monday. While pledges of foreign investment this year are down more than 70 percent from a year ago, actual disbursements for overseas-backed projects are only down about 10 percent, an “impressive inflow” that helps support Vietnam’s balance of payments, fund manager Vietnam Holding Asset Management Ltd. said this month. The devaluation of Vietnam’s currency last month by the central bank was also aimed largely at narrowing the trade deficit, VinaCapital said, citing stronger exports and an increase in the cost of imports as a result of the weaker dong. “The external environment appears to be improving,” VinaCapital said, in a monthly note to investors. “Looking forward to 2010, exports will likely continue to recover, helped by Vietnam’s attractive cost base.” Concern over Vietnam’s balance of payments is “short-term noise,” Ho Chi Minh City-based fund manager Dragon Capital said last week, citing the country’s “minimal external debt.” Vietnam’s external debt is less than 30 percent of the country’s gross domestic product, wrote Sofat of Barclays. Source: Bloomberg

Vietnam economy expands 4.59 percent in 9 months

Vietnam gross domestic product grew 4.59 percent in the first nine months of the year, up from 3.9 percent in the first half, the Ministry of Planning and Investment said Monday.

The growth was led by the service sector, which expanded 5.91 percent over the period. The industry-construction sector posted a growth of 4.48 percent and the agriculture sector 1.57 percent.

In the third quarter alone, growth accelerated to 5.76 percent, compared to the second quarter’s 4.46 percent and 3.1 percent in the first-quarter. The first quarter growth was the slowest on record over the last decade. The ministry said the acceleration means the economy was improving although the growth rates are lower than last year.

The government is targeting a 5.2 percent expansion for the year, followed by 6.5 percent in 2010.

The Asian Development Bank on September 22 revised upwards its 2009 GDP growth forecast for Vietnam to 4.7 percent from the 4.5 percent it projected in March.

Source: VNA

Vietnam economy on the rise

Photo: Chuck Kuhn Photography

Vietnam has “weathered the crisis astonishingly well so far,” HSBC Holdings Plc. said in a research note Wednesday. A rebound in construction and manufacturing is now driving the economy, it said.

The economy is forecast to experience a “big bounce” in growth to 6.8 percent in 2010 from 4.7 percent this year, the bank said.

“The recovery has begun,” Prakriti Sofat, a Singapore-based economist at HSBC, said in Wednesday’s note. “Things will continue to improve from here on, given the impact of the massive policy easing, the bulk of which was delivered in the later part of 2008, and improvement in global growth outlook.”

The State Bank of Vietnam cut its benchmark lending rate to 7 percent in February from 14 percent in October 2008. The key interest rate may be maintained at its current level until the third quarter of 2010, according to HSBC.

Vietnam’s economy grew 4.5 percent in the second quarter from a year earlier, up from 3.1 percent in the previous three months, the statistics office said last week. For the first half, gross domestic product expanded 3.9 percent.

Exports fell 10 percent to US$27.6 billion in the first six months, but in May and June exports grew 3.2 and 6.5 percent month-on-month, figures from the Ministry of Planning and Investment showed.

“The economic picture during the first half proved that the government’s stimulus measures began to take effect,” the research team of Ho Chi Minh City-based Saigon Securities Inc. wrote in a report dated July 6.

“The loosened monetary policies together with the interest-rate subsidy program played an important role in helping the economy through the most difficult times,” the team said. It forecast the economy could expand by up to 4.9 percent this year.

The economy is improving, Prime Minister Nguyen Tan Dung said in a statement posted late Tuesday on the government’s website that called for topping a 5 percent growth target that had been revised down earlier this year from an initial goal of 6.5 percent.

Stimulus measures

more info-->>Vietnam latest news - Thanh Nien Daily

Vietnam Growth Slows to 6.2%; Building, Tourism Slump

Vietnam’s economy expanded at the slowest pace since 1999 as higher interest rates and lending restrictions earlier this year damped construction and a global recession hurt tourism.
Gross domestic product in the Southeast Asian nation grew 6.2 percent this year, according to the General Statistics Office in Hanoi, slowing from 8.5 percent in 2007. The expansion fell short of a 6.7 percent government target, which earlier in the year had been set as high as 9 percent.
First-half economic overheating caused Vietnam’s government to restrict credit, ending a property boom that had driven construction growth. Concern the global economic slump will hurt demand is discouraging local companies from taking on new debt now even as interest rates fall, threatening to further slow the Vietnamese economy in 2009.
“This is a more resilient result than I would have expected considering the global economy, but Vietnam still hasn’t felt the full impact of the global downturn yet,” said Sherman Chan, a Sydney, Australia-based economist at Moody’s Economy.com. “The first half of 2009 will be the toughest time.”
Growth in the industry and construction category, which accounted for 40 percent of the Vietnamese economy, slowed to 6.3 percent in 2008 from 10.6 percent in 2007, the General Statistics Office said. The sub-category that includes only construction grew 0.02 percent from a year earlier.
“In the first half the whole construction industry was booming, and we couldn’t produce steel fast enough to sell it,” said Alan Young, chief operating officer of Vietnam Industrial Investments Ltd. “Then there was a very sudden drop in demand. In the worst case, we’re looking at 2009 as a survival year.”
Borrowing Cools
Growth in services, which accounted for 38 percent of gross domestic product, slowed to 7.2 percent from 8.7 percent. Financial services grew 6.6 percent from a year earlier.
“Banks have tightened lending requirements, and overall corporate borrowing demand has cooled in line with near-term investment prospects,” fund managers Indochina Capital Advisors Ltd. said in a note this month.
Services were also affected by sluggish growth in tourism- related industries, with the General Statistics Office saying in a separate report that the number of international visitors to Vietnam rose 0.6 percent in 2008.
Agriculture, forestry and fisheries, which accounted for 22 percent of the economy, expanded at a 3.8 percent rate, up from 3.4 percent in 2007.
2009 Growth Target
Vietnam’s government is targeting 6.5 percent economic growth next year, and is considering a 100 trillion-dong ($5.7 billion) plan to stimulate demand, according to a VietnamNet article dated Dec. 17 and posted on the Web site of the country’s Ministry of Finance.
The International Monetary Fund forecasts a 5 percent expansion and CLSA Asia-Pacific Markets predicts 3.5 percent growth for Vietnam in 2009.
Vietnam’s strategy of pursuing “growth at all costs” is risky with a current-account deficit that may have reached 13 percent of gross domestic product this year, Anthony Nafte, an economist at CLSA Asia-Pacific Markets, wrote in a note this month.
“The only way that this policy could succeed is if the large foreign-direct-investment inflows of recent years were to be sustained,” Nafte said. “But this will be difficult in the current environment of scarce foreign capital and high risk aversion.”
To contact the reporters on this story: Jason Folkmanis in Ho Chi Minh City at folkmanis@bloomberg.net.

Vietnam Devalues Dong to Fight Slowdown, Help Exports

Vietnam’s central bank devalued the dong by 3 percent to help exporters after the Southeast Asian economy expanded at the slowest pace in nine years and the trade deficit widened.
The State Bank of Vietnam fixed the reference rate at 16,989 dong per dollar, versus 16,494 yesterday, according to its Web site. Policy makers maintained a currency band that allows the dong to rise or fall 3 percent a day, said Nguyen Quang Huy, director of the regulator’s foreign-exchange department.
Export growth slowed in the past three months as stagnating global economies cut demand for Vietnam’s garments and coffee and the country became less competitive after currencies in neighboring markets weakened more than the dong. Vietnam’s currency has dropped 5.5 percent this year against the dollar compared with an 18 percent slide in India’s rupee, 14 percent decline for Indonesia’s rupiah and a 13 percent slump in the Philippine peso.
“The devaluation is necessary as the government is trying to increase exports,” said Do Ngoc Quynh, chairman of the Vietnam Bond Forum in Hanoi and head of currency and debt trading at Bank for Investment & Development of Vietnam, the nation’s second-biggest lender by assets. “Other currencies in the region have considerably declined against the dollar, but the dong hasn’t dropped that much.”
The dong traded at 17,300 to 17,450 a dollar as of 3 p.m. in Hanoi, according to Bank for Agriculture & Rural Development, the nation’s biggest lender by assets.
Ensuring Stability
“The new reference rate will help increase exports, narrow the trade deficit, and also ensure the stability of balance of payments,” the central bank said on its Web site today.
At money changers, or the so-called black market, the currency traded between 17,270 and 17,350 to the dollar in Hanoi, according to a telephone directory information service, known as 1080, run by state-owned Vietnam Posts and Telecommunications. The dong has tumbled 35 percent since the end of 1994 as the central bank devalued the currency every year.
Vietnam’s VN Index of stocks fell 0.6 percent to 302.19, the lowest level in more than a week. The measure has declined 67 percent this year, the worst-performing benchmark index in Asia.
Gross domestic product grew 6.2 percent in 2008, after expanding by a record 8.5 percent last year, the government said in a statement yesterday.
Trade Deficit
Vietnam’s trade deficit widened to a record $17 billion in 2008, from $14.1 billion last year, according to preliminary figures provided by the government today.
The shortfall in the current account may grow to $12.1 billion in 2009, or 12.3 percent of GDP, from an estimated $10.5 billion this year, or 11.7 percent of GDP, according to a Credit Suisse Group research report dated Dec. 17.
“The Vietnamese dong is facing downward pressure due to the current-account deficit,” said Yuichi Izumi, an economist at Nomura Securities Co. in Tokyo. “The State Bank wants to guide the dong lower to support the export sector.”
Slower gains in consumer prices may have also provided more room for the central bank to weaken the dong. Inflation cooled for a fourth month in December to the slowest pace in nine months, with consumer prices rising 19.9 percent from a year earlier, the government said today. The rate touched 28.3 percent in August, the highest since at least 1992.
The devaluation followed five interest-rate cuts by the central bank this quarter to help bolster the economy. Policy makers last lowered the benchmark rate on Dec. 19 by the most ever this year to 8.5 percent, from 10 percent. The new cost of money became effective Dec. 22.
To contact the reporter on this story: Nguyen Dieu Tu Uyen in Hanoi at uyen1@bloomberg.net

Rupee shoots up by 60 paise vs US dollar

Mumbai, Dec 10, 2008 (Asia Pulse Data Source via COMTEX) -- In tandem with the upswing in equity markets, the rupee, after Monday's brief pause, today shot up by 60 paise to end at a nearly 4-week high of 48.98/49.00 against the dollar on expectations of more capital inflows.
In fairly active trade at the Interbank Foreign Exchange (Forex) market, the local unit opened sharply higher at 49.18/20 a dollar from the previous close of 49.58/59.
Initially, it touched the day's low of 49.35 on some dollar buying by oil refiners.
But a spurt in the Sensex after the government unveiled a multi-crore stimulus package for the economy and dollar selling by banks on expectations of a further fall in the greenback helped the rupee to rally smartly, a forex dealer said.
Some stability in most of the Asian stock markets after the announcement of the stimulus packages by many developed as well as developing countries might have brought some relief in the market.
As a result, the Sensex flared up by another 492 points, or 5.37 per cent, while Asian indices ended the day with a gain between 2.0 per cent and 5.6 per cent.
Foreign funds were also buyers in the past few days and looking at the stability in the share markets, they expected to invest more at the current lower levels in the coming days, which also boosted the rupee sentiment.
The rupee breached the 49 level and touched a high of 48.89 before concluding the day at 48.98/49.00, a rise of 1.21 per cent.
Meanwhile, the RBI fixed the reference rate for the dollar at Rs 49.12 and for the single European currency at Rs 63.52. The rupee premiums on the forward dollar improved further on sustained paying pressure from banks and corporates.
The benchmark six-month forward dollar premium payable in May ended at 79-82 paise, higher from 71-74 paise on Monday and the far-forwards maturing in November also finished up at 111-114 paise from 100-103 paise, previously.
In cross-currency trade, the rupee recovered sharply against the pound sterling and the euro and remained firm against the Japanese yen.
The domestic currency surged against the pound sterling to end the day at Rs 72.44/46 from the previous close of Rs 73.92/94 and also recouped against the single European currency to Rs 63.34/36 per euro from the last close of Rs 63.84/86 per euro.
The rupee, however, improved further against the Japanese yen to Rs 52.78/80 per 100 yen from Monday's close of Rs 53.11/13 per 100 yen.

German Firms Big on Investing in Emerging Vietnam

More than 30 years after the end of the Vietnam War, the economy has become one of fastest growing in Asia and has attracted German investors, who regard its young population as the next "Asian Prussians."

Next to China and India, two of the biggest emerging economies in Asia, is the Socialist Republic of Vietnam, a sliver of land on the Indochinese peninsula with a population of 86 million.

The war-ravaged nation was politically isolated for more than a decade after the Fall of Saigon in 1975 that led to the integration of the southern half into a nation that came under complete Communist rule a year later.

Most Vietnamese today were born after the end of the war. Today a young eager workforce that has come of age has suddenly become immensely attractive to foreign investors and multinational companies.

One of world's fastest growing economies


Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift: It took many years after Saigon was evacuated in 1975 for Vietnam to open up
After a political opening and some market reforms that were introduced in the late 1980s, Vietnam has since managed to achieve an average annual growth rate of about eight percent annually, making it one of the world's fastest growing economies.

Although still a relatively poor country, Vietnam's two-way trade has exploded in the last decade or so, with commodities such as rice, coffee, tea and rubber, as well as fisheries being among its key exports. Its manufacturing base and high tech industries are also a fast-growing part of the domestic economy, as the country's agriculture output has significantly declined.

In January 2007, Vietnam joined the World Trade Organization and counts Japan, the US and western Europe among its chief trading partners.

A growing number of German companies are singing praises about gaining a foothold in a potentially lucrative market, where the workforce is predominantly young, eager, hard working and in some cases even highly skilled.

Potentially lucrative Asian market

Jan Noether is a go-between for German investors and companies at the German Industry and Commerce Vietnam. Most of the 250 German firms are active in trade, production and providing services.

Ever since Vietnam joined WTO, interest in doing business there has exploded, he said. In this year alone, Noether hosted more than 20 business delegations from Germany.

Still Vietnam as a country that has emerged from an impoverished state planned economy barely 20 years ago, needs to overcome various challenges in order to maintain its growth momentum. This means addressing infrastructural needs and more vocational training efforts, for example.

The young workforce is among the nation's greatest assets and the low wages are an incentive for foreign companies to set up production and manufacturing sites in Vietnam.

An unskilled worker earns $120 to $150 a month, but soaring inflation means that these minimum wages need to be adjusted. Next year, average wages are expected to go up to between $150 and $180.


Bildunterschrift: Low wages attract foreign investors to set up production sites in Vietnam
Better infrastructure needed

At present, the country's nascent infrastructure in terms of transportation logistics cannot keep pace with exponential growth in all other sectors. The dearth of paved roads to transport goods for instance has been a hindrance to business development.

Noether expects that the outfall of the world financial crisis will have a small impact on growth as well. This year Noether foresees a slight slowdown in the economy to little more than six percent, due to a reduction in consumer demand.

Still, German companies rank Vietnam ninth in the world as a favorable destination for investors, and Noether dubs the motivated, hard-working young Vietnamese as the next "Asian Prussians."



Esthers Broders (df)

Vietnam economy back from brink, global crisis spells new worries

Vietnam's economy, which started overheating months ago, has begun to stabilise, but experts warn the government must stay the course as the global financial system is plunged into crisis.
The communist nation, a World Trade Organisation member since 2007, has battled galloping inflation and a ballooning trade deficit, but also managed to slow the macroeconomic imbalances and eased fears of a meltdown.
Inflation reached 27.9 percent year-on-year in September, but the monthly increase in consumer prices had dropped to just 0.18 percent, said the state-run General Statistics Office.
The trade deficit over the first nine months grew to 15.8 billion dollars, but the widening of the trade gap had also levelled off.
"Compared to two or three months ago, economic conditions have definitely improved," said the International Monetary Fund's (IMF) country representative Benedict Bingham. "The government is to be commended for stabilizing the situation and breaking the negative sentiment."
Bingham also praised the central bank for restoring trust in the dong currency and fighting inflation and credit growth through tightening liquidity with higher interest rates and other measures.
Sin Foong Wong, country chief of the International Finance Corporation (IFC), an arm of the World Bank, also praised Vietnam's recent efforts.
"Things have become better compared to the situation in the middle of the year when people were talking about a crisis, about a Vietnam that could become the next Thailand," he said, referring to the start of the 1997 Asian crisis.
"Now inflation has trended down, Vietnam had its lowest month-to-month increase in September, and most important, food prices have also come down, especially rice," he told AFP.
"If we look at the trade deficit, we begin to see the alarming trend to be mitigated on a monthly basis as the measures taken to cool the economy begin to have an impact on imports," Wong said.
Other observers said Vietnam's leaders had not gone far enough, especially in cutting the fiscal deficit and reducing the role of inefficient state owned enterprises (SOEs) that still dominate major economic sectors.
"We need real cutting in expenditures," said Nguyen Quang A, president of the Institute of Development Studies. "We are awaiting some very concrete measures from the government and the SOEs."
Experts cautioned against a slackening of economic discipline, especially when inflation remains so high and while the financial crisis is sweeping through the United States and Europe, Vietnam's main export markets.
Vietnam's young and insulated financial sector is not directly exposed to the factors that drove the US banking meltdown, such as the subprime crisis, but the economy is sure to feel the wider effects of the turmoil, they said.
"The (Vietnam) trend seems to be positive but one issue is: what will be the local impact of the global turmoil?" said the IFC's Wong.
"Things are hard to quantify. Exports might be impacted if there is a recession in the US and Europe, and FDI (foreign direct investment) could be pulled back, but you can make those comments on many other countries."
Vietnam's leaders, long focused on economic growth targets, have shifted to fighting inflation first and prepared public opinion for a sharp drop in gross domestic product growth from last year's 8.5 percent.
The rising prices have driven a wave of strikes this year and fuelled public anger.
Experts warn they threaten to reverse some of Vietnam's development successes, which have lifted millions out of dire poverty.
Last month the government reported that the number of households who have reported food shortages so far this year had shot up by 60 percent from the same period in 2007, to 3.6 million people.

Vietnam plans 20 pct hike in electricity prices

HANOI, Vietnam: Vietnam, desperate for new power plants, will likely raise retail electricity prices by 20 percent next year to attract more investment in the energy sector, a state news report said Wednesday.
The online newspaper VnExpress quoted Vice Minister of Trade and Industry Bui Xuan Khu as saying Vietnam would begin raising its government-controlled electricity prices next year.
"Recently, we have maintained low retail prices with the goal of containing inflation," Khu was quoted as saying. "The price will rise starting in 2009."
Electricity prices in Vietnam are much lower than those elsewhere in the region, making the country less attractive to potential energy investors, Khu said.
The pricing plan will be submitted soon to Prime Minister Nguyen Tan Dung for final approval, the report said.
Vietnam's demand for power is expected to grow by 16 percent a year until 2015, according to government projections, and the country's booming economy has made it difficult to keep pace with demand.
The price hike will target households while electricity costs for manufacturers will remain unchanged or will be increased slightly, Khu said.
Vietnam charges households 862 dong (5 U.S. cents) per kilowatt hour, while manufacturers pay 900 dong (5.5 cents).
Thailand, Singapore, Indonesia and Malaysia charge from 14 cents to 15 cents, said Chu Van Tien, an official at Electricity of Vietnam, the country's power company.
In neighboring China, the top price is 7.5 cents per kilowatt hour.
The prime minister has assigned the Ministry of Trade and Industry to work with EVN to work out a suitable pricing mechanism that will attract investment, Tien said.

-->

Inflation Delivers a Blow to Vietnam’s Spirits -

Even the ghosts are suffering from inflation in Vietnam this year.
August is the month when Buddhists ply the hungry ghosts of the dead with food and wine and cigarettes and honor them with paper offerings that represent the good things in life: cars, houses, motorbikes, stereo sets, fancy suits.
But like everything else in Vietnam, these brightly colored offerings have risen steeply in price, and shopkeepers say people are buying fewer gifts to burn for the dead.
With inflation rising to 27 percent last month — the highest in Asia — and food prices 74 percent above those a year ago, Vietnam is suffering its first serious downturn since it moved from a command economy to an open market nearly two decades ago.
Last month the government raised the price of gasoline by 31 percent to an all-time high of 19,000 dong ($1.19) per liter (or roughly $4.50 a gallon). Diesel and kerosene prices rose still higher. The country’s fledgling stock market, which had been booming a year ago, has fallen in volume by 95 percent and is at a virtual standstill.
Squeezed on all sides, people are cutting back on food, limiting travel, looking for second jobs, delaying major purchases and waiting for the cost of a wedding to go down before marrying.
Some village women who traveled to Hanoi to sell special homemade candies for the hungry ghost festival say they have not earned enough this year to return home.
Given this slowdown, Vietnam, Asia’s youngest tiger, which had been growing by about 8 percent a year for the past decade, is scaling back its plans for growth and economic development.
Last month the Asian Development Bank forecast that growth would slow to 6.5 percent this year. Some economists say even that figure is probably too high. Trade and current-account deficits have widened.
The mood in Vietnam, after years of upward mobility, is tense, said Kim N. B. Ninh, the Asia Foundation’s country representative.
“I think people are pessimistic,” she said. “You sense a tougher environment, a more restricted environment, a more pessimistic environment. It’s a moment of turmoil, I think.”
Some are losing confidence in the ability of the government to manage the economy. And rumors of price increases have caused panic buying of fuel and rice.
“The government seems confused about how to deal with the difficulties, and they have been making some mistakes in running the economy,” said a young lawyer who spoke on condition of anonymity when criticizing the government.
In part, economists say, Vietnam is suffering from the worldwide economic downturn and from high inflation that has spread through Southeast Asia.
But they say the problems are also self-inflicted, the result of an overheated economy as Vietnam raced forward with inadequate safeguards. Too much capital, particularly from foreign investment, has collided with bottlenecks in infrastructure and capacity.
The education system, meanwhile, has produced too few skilled and semiskilled workers for Vietnam to move up quickly into more complex manufacturing industries.
Hundreds of strikes at the factories that have been engines of Vietnam’s growth are some of the sharpest signs of discontent.
Some of the factory workers who are leading Vietnam’s rise from poverty are returning to the countryside, according to the local press, unable to sustain an urban life on a factory wage.
“Some people who have been moving from rural areas to seek jobs in industrial zones are deciding that it is not worth it, and people are moving home,” said Ben Wilkinson, associate director of the Vietnam program at the Kennedy School of Government at Harvard.
After a steep reduction in the poverty rate from 58 percent of the population in 1993 to around 15 percent last year, some people — including those who had bought their first motorbike or cellphone — are slipping back below the poverty line.
Prime Minister Nguyen Tan Dung told the National Assembly in May that the number of households going hungry had doubled in one year.
Everywhere they turn these days, people in Vietnam see higher prices.
more info-->>Inflation Delivers a Blow to Vietnam’s Spirits - NYTimes.com

Vietnam attracts over $30 bln of foreign investment in first half

Vietnam attracted 31.6 billion U.S. dollars in foreign direct investment in the first half of the year, as against 20.3 billion dollars of the whole 2007, said a senior economic official here Saturday.
The figure proved that foreign investors remained confident in Vietnam although its economy was experiencing great difficulty, said Cao Viet Sinh, Deputy Minister of Planning and Investment
The country is likely to attain a gross domestic product (GDP) growth rate of between 6.6 and 6.7 percent in the first six months, said Sinh, adding that the rate helps ensure the targeted growth for the whole year of 7 percent set by the National Assembly.
Also in the six months, the country earned 29.7 billion dollars from exports, said the deputy minister.

A woman's world

Irene Natividad, president of the Global Summit of Women, says in a Thanh Nien Daily interview that women rarely have a chance to participate in an international conference focusing on their issues
Thanh Nien Daily interviews outspoken social activist and political figure Irene Natividad, president of the Global Summit of Women, as she prepares for the three-day summit in Hanoi beginning tomorrow.
Thanh Nien: Why was Vietnam chosen to host the Global Summit of Women 2008?
Irene Natividad: I came here for the APEC CEO Summit a year ago when everyone was talking about Vietnam being the hot new tiger of Asia.
We are a business summit and it’s clearly important for us when we rotate to Asia to come to a country that is the newest economic tiger.
The former vice president of Vietnam, Madame Truong My Hoa, as well as the current vice leader of the Vietnam Chamber of Commerce and Industry (VCCI) had been to three prior summits and brought significant delegations of Vietnamese entrepreneurs.
For last year’s summit in Berlin, there was a [Vietnamese] delegation of 65.
It was very impressive.
It shows that Vietnam, and especially its women, were back in business and that they are reaching out globally to make business connections for their enterprises.

The Wall Street Journal recently had an article saying how one third of Vietnam’s businesses, some of its largest companies in fact, are headed by women.
The theme for this year’s summit is: “Women and Asia – Driving the Global Economy.” What is the message this summit wants to deliver to all women in the world – and especially in Asia? How does holding it in Vietnam help deliver that message?
Basically, the centers for business now have globally shifted to Asia, with the leadership of China and India given their size.
But countries like Vietnam are also driving that economic growth.
I want Asian women to be part of that growth so that they can learn through the summit how to expand their businesses, how to improve their skills, whether they work for a corporation or whether they own their businesses.
It’s important for them to be able to connect globally, to know what it takes to succeed even higher.
We will have women here from all over Asia.
I want this forum to be a vehicle for women to place themselves on another level.
Will the summit tackle tough issues pertaining specifically to women, for example, human trafficking?
The summit is about solutions and that was how we began 18 years ago.
We wanted a forum where we could exchange what you did in your country with what I did in my country, and out of that will come solutions that are practical.
So the summit is not going to issue a piece of paper.
For example, we are going to have a session focused on human trafficking, but not to talk about whether it is a problem.
That has been discussed very well in other arenas; instead we will talk about how Microsoft has been dealing with trafficking.
They gave a US$1 million grant a year ago to Asian countries to help develop technology training so that there are alternative sources of income, so women don’t turn to trafficking.
We’re going to hear from the deputy minister of labor of Mexico about what that country has been doing with human trafficking.
We’re going to hear from Vietnam about some of the efforts here.
So the focus is on solutions.
Remember that trafficking has to do with economics.
It’s a way to make a living.
If we can show women other ways to make a better living, then that’s one of the approaches to defeating trafficking or at least slowing it down.
How do you think the global economic downturn and the fact that Vietnam is facing some challenges with its own economy will affect the discussion at the conference?
The economic downturn is global.
It’s not just in Vietnam.
It’s in my country, the US, and that has had repercussions.
So anytime there’s an economic downturn, it affects everything that we do.
It will be not just one specific session; it will be in all the discussions.
How do you think Vietnamese women and entrepreneurs will benefit from this summit?
I hope they will benefit the same way I hope all other delegates will benefit from it: making contact, learning new skills, learning new strategies, exposure to role models that will be here from every part of the world.
How many times do we think women have access to an inter-national conference? Very, very few.
We cannot afford to be isolated.
So what we do with the summit is very difficult, we bring it to every continent.
It’s new each time.
We start from zero each time.
We go to where all the women are, in every part of the world.
Do you consider yourself a feminist?
If a feminist means any person, woman or man, who believes that women have equal access to opportunity in every arena of public life, then yes, I am.
Reported by Thu Huong