Economy of Vietnam

Vietnam's socialist-oriented market economy is a developing planned economy and market economy. Since the mid-1980s, through the Đổi Mới reform period, Vietnam has made a shift from a highly centralized planned economy to a mixed economy which use both directive and indicative planning through five-year plans. Over that period, the economy has experienced rapid growth. In the twenty-first century, Vietnam is in a period of being integrated into the global economy. Almost all Vietnamese enterprises are small and medium enterprises (SMEs). Vietnam has become a leading agricultural exporter and served as an attractive destination for foreign investment in Southeast Asia. In a similar fashion to other Communist countries after the end of the Cold War the planned economy of Vietnam lost the momentum for productivity and sustainable growth. In the current period the economy of Vietnam relies largely on foreign direct investment to attract the capital from overseas to support its continual economic rigorousness.

In 2013, the nominal GDP reached US$170.565 billion, with nominal GDP per capita of US$1,902. According to a forecast in December 2005 by Goldman Sachs, the Vietnamese economy was expected to become the 35th largest economy in the world with nominal GDP of US$436 billion and nominal GDP per capita of US$4,357 by 2020. According to a forecast by the PricewaterhouseCoopers in 2008, Vietnam may be the fastest-growing of the world's emerging economies by 2020, with a potential annual growth rate of about 10% in real terms, which would increase the size of the economy to 70% of the size of the UK economy by 2040.

Vietnam has been named among the Next Eleven and CIVETS countries. Despite economic achievement following Doi Moi, there exist issues that cause many analysts and researchers to remain worried about the economic slowdown in the country in recent years.

Although the industrial sector contributed 40.1% of GDP in 2004, it employed only 12.9% of the workforce. In 2000, 22.4% of industrial production was attributable to non-state activities. From 1994 to 2004, the industrial sector grew at an average annual rate of 10.3%. Manufacturing contributed 20.3% of GDP in 2004, while employing 10.2% of the workforce. From 1994 to 2004, manufacturing GDP grew at an average annual rate of 11.2%. The top manufacturing sectors — food processing, cigarettes and tobacco, textiles, chemicals, and electrical goods — experienced rapid growth. Almost a third of manufacturing and retail activity is concentrated in Ho Chi Minh City.[

In 2004, services accounted for 38.2% of gross domestic product (GDP). From 1994 to 2004, GDP attributable to the service sector grew at an average annual rate of 6.0%.

In 2012, Vietnam welcomed 6.8 millions international visitors and the number is expected to be more than 7 millions in 2013. Vietnam keeps emerging as an attractive destination. 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

Most efficient and reliable banks are the largest (also state-owned) ones: VietinBank, BIDV, and Vietcombank. The banking sector is dominated by the three institutions. There is also a trend of foreign investment into profitable banks. 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%).

Vietnam's top five banks by registered capital (as of May 2013, USD/VND exchange rate = 21,000 VND)

VietinBank $1.56 billion (32,661 billion VND)
Agribank $1.39 billion (29,154 billion VND)
Vietcombank $1.10 billion (23,174 billion VND)
BIDV $1.10 billion (23,011 billion VND)
Eximbank $0.59 billion (12,355 billion VND)

Vietnam currently has two stock trading centers, the Ho Chi Minh City Securities Trading Center and the Hanoi Securities Trading Center, which run the Ho Chi Minh Stock Exchange (HOSE) and the Hanoi Stock Exchange (HNX), respectively.

In 2004, Vietnam’s exports of merchandise were valued at US$26.5 billion, and, were growing rapidly along with imports. Vietnam’s principal exports were crude oil (22.1%), textiles and garments (17.1%), footwear (10.5%), fisheries products (9.4%) and electronics (4.1%). The main destinations of Vietnam's exports were the United States (18.8%), Japan (13.2%), China (10.3%), Australia (6.9%), Singapore (5.2%), Germany (4.0%), and the United Kingdom (3.8%).

In 2012, export rose 18.2%, valued at US$114.57 billion. 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.

In 2013, export 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. Textiles and garments are still an important part in Vietnam's export, valued about US$17.9 billion in 2013.

In 2014, exports rose 13.6%, reaching US$150.1 billion. Electronics and electronics parts, textiles and garments, computers and computer parts are the three main export groups of Vietnam. The United States continued to be Vietnam's largest export market, with US$28.5 billion. 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.

In 2004 Vietnam’s merchandise imports were valued at US$31.5 billion, and growing rapidly. Vietnam’s principal imports were machinery (17.5%), refined petroleum (11.5%), steel (8.3%), material for the textile industry (7.2%), and cloth (6.0%). The main origins of Vietnam’s imports were China (13.9%), Taiwan (11.6%), Singapore (11.3%), Japan (11.1%), South Korea (10.4%), Thailand (5.8%), and Malaysia (3.8%).

Vietnam import rose 6.6% in 2012, valued at US$113.79 billion.[39] Major import countries were China US$29.2 billion, ASEAN with US$22.3 billion, South Korea with US$16.2 billion, Japan with US$13.7 billion, EU with US$10 billion, and United States with US$6.3 billion.

In 2014, imports rose 12.1%, reaching US$148 billion, most of which are materials and machinery needed for export. China continued to be Vietnam's largest import partner, with US$43.7 billion. The ASEAN is second with US$23.1 billion, South Korea is third, Japan is fourth and the EU is the fifth largest import partner of Vietnam.