Vietnam Economy 2008

Economy - overview:
Vietnam is a densely-populated developing country that in the last 30 years has had to recover from the ravages of war, the loss of financial support from the old Soviet Bloc, and the rigidities of a centrally-planned economy. Substantial progress was achieved from 1986 to 1997 in moving forward from an extremely low level of development and significantly reducing poverty. Growth averaged around 9% per year from 1993 to 1997. The 1997 Asian financial crisis highlighted the problems in the Vietnamese economy and temporarily allowed opponents of reform to slow progress toward a market-oriented economy. GDP growth averaged 6.8% per year from 1997 to 2004 even against the background of the Asian financial crisis and a global recession. Since 2001, Vietnamese authorities have reaffirmed their commitment to economic liberalization and international integration. They have moved to implement the structural reforms needed to modernize the economy and to produce more competitive, export-driven industries. The economy grew at an average annual rate of 8% in 2005-07. Vietnam's membership in the ASEAN Free Trade Area (AFTA) and entry into force of the US-Vietnam Bilateral Trade Agreement in December 2001 have led to even more rapid changes in Vietnam's trade and economic regime. Vietnam's exports to the US increased 800% from 2001 to 2006. Vietnam joined the WTO in January 2007, following over a decade long negotiation process. This should provide an important boost to the economy and should help to ensure the continuation of liberalizing reforms. Among other benefits, accession allows Vietnam to take advantage of the phase-out of the Agreement on Textiles and Clothing, which eliminated quotas on textiles and clothing for WTO partners on 1 January 2005. Agriculture's share of economic output has continued to shrink, from about 25% in 2000 to 20% in 2006. Deep poverty, defined as a percent of the population living under $1 per day, has declined significantly and is now smaller than that of China, India, and the Philippines. Vietnam is working to create jobs to meet the challenge of a labor force that is growing by more than 1 million people every year. Vietnamese authorities have tightened monetary and fiscal policies to stem high inflation. Hanoi is targeting an economic growth rate of 7.5-8% during the next four years.

GDP (purchasing power parity):
$222.5 billion (2007 est.)

GDP (official exchange rate):
$53.61 billion (2007 est.)

GDP - real growth rate:
8.2% (2007 est.)

GDP - per capita (PPP):
$2,600 (2007 est.)

GDP - composition by sector:
agriculture: 19.4%
industry: 42.3%
services: 38.3% (2007 est.)

Labor force:
45.73 million (2007 est.)

Labor force - by occupation:
agriculture: 56.8%
industry: 37%
services: 6.2% (July 2005)

Unemployment rate:
4.2% (2007 est.)

Population below poverty line:
19.5% (2004 est.)

Household income or consumption by percentage share:
lowest 10%: 2.9%
highest 10%: 28.9% (2004)

Distribution of family income - Gini index:
37 (2004)

Inflation rate (consumer prices):
8.1% (2007 est.)

Investment (gross fixed):
33% of GDP (2007 est.)

Budget:
revenues: $18.28 billion
expenditures: $19.79 billion (2007 est.)

Public debt:
43.3% of GDP (2007 est.)

Agriculture - products:
paddy rice, coffee, rubber, cotton, tea, pepper, soybeans, cashews, sugar cane, peanuts, bananas; poultry; fish, seafood

Industries:
food processing, garments, shoes, machine-building; mining, coal, steel; cement, chemical fertilizer, glass, tires, oil, paper

Industrial production growth rate:
10.5% (2007 est.)

Electricity - production:
51.33 billion kWh (2005)

Electricity - consumption:
45.46 billion kWh (2005)

Electricity - exports:
0 kWh (2005)

Electricity - imports:
0 kWh (2005)

Oil - production:
375,000 bbl/day (2005 est.)

Oil - consumption:
254,000 bbl/day (2005 est.)

Oil - exports:
399,200 bbl/day (2004)

Oil - imports:
238,400 bbl/day (2004)

Oil - proved reserves:
600 million bbl (1 January 2006 est.)

natural gas - production:
3.836 billion cu m (2005 est.)

natural gas - consumption:
3.836 billion cu m (2005 est.)

natural gas - exports:
0 cu m (2005 est.)

natural gas - imports:
0 cu m (2005)

natural gas - proved reserves:
184.7 billion cu m (1 January 2006 est.)

Current account balance:
-$1.199 billion (2007 est.)

Exports:
$49.91 billion f.o.b. (2007 est.)

Exports - commodities:
crude oil, marine products, rice, coffee, rubber, tea, garments, shoes

Exports - partners:
US 21.2%, Japan 12.3%, Australia 9.4%, China 5.7%, Germany 4.5% (2006)

Imports:
$51.95 billion f.o.b. (2007 est.)

Imports - partners:
China 17.7%, Singapore 12.9%, Taiwan 11.5%, Japan 9.8%, South Korea 8.4%, Thailand 7.3%, Malaysia 4.2% (2006)

Economic aid - recipient:
$1.905 billion in credits and grants pledged by the 2006 Consultative Group meeting in Hanoi (2005)

Reserves of foreign exchange and gold:
$17.16 billion (31 December 2007 est.)

Debt - external:
$24.41 billion (31 December 2007 est.)

Stock of direct foreign investment - at home:
$26.27 billion (2006 est.)

Stock of direct foreign investment - abroad:
$NA

Market value of publicly traded shares:
$NA

Currency (code):
dong (VND)

Exchange rates:
dong per US dollar - 16,119 (2007), 15,983 (2006), 15,746 (2005), NA (2004), 15,510 (2003)