General Market Information

MARKET CHARACTERISTICS

Since the introduction of Doi Moi in 1986, a program of economic reform, Vietnam’s economy has experienced a great transformation, from a centrally planned economy to the market economy.

Vietnam became a member of the WTO in 2007. This represents a strong commitment from the Vietnamese Government in adopting more investment-friendly policies as well as a liberalization of the Vietnamese economy through equitization of State Owned Enterprises (SOEs).

The Vietnamese Government (GVN) currently has several actions toward long term perspective in order to foster the development of different business sectors, to improve market – oriented economic regulations, and to transform from low labour cost, natural mineral depending economy to the industrial driven economy. This includes multiple devalued dongs against US dollars in 2010 and 2011 (> 20%); issued and implemented the Vietnam’s Resolution 11 to stabilize the economy, reduce the trade deficits, tighten the money policy, etc.

The Business Monitor International remains possitive about Vietnam's growth rate, averaging 7.1% over the next decade 2012-2021.

ECONOMIC DEVELOPMENT AREAS

Being the largest political and administrative centre, Hanoi is also the second biggest commercial centre of Vietnam after Ho Chi Minh City (HCMC, formerly known as Saigon). After HCMC and Hanoi, Dong Nai, Binh Duong and Ba Ria - Vung Tau are the provinces with the largest investment capital from FDI projects.

Major economic development areas are divided into 02 geographical regions; the Southern strategic economic region includes the Mekong river delta provinces HCMC, Dong Nai, Binh Duong, Ba Ria – Vung Tau, Tay Ninh, Binh Phuoc, Tay Ninh, Binh Phuoc and Long An; the Northern strategic economic region includes the Red river delta provinces Hanoi, Hai Phong, Hai Duong, Vinh Phuc, Quang Ninh, Hung Yen and Bac Ninh.

Industries like maritime (ship building), steel, energy (coal exploitation, hydro and coal fired power) and the cement industry, have a higher concentration in the North. Oil & gas, agriculture and light industries (textile, footwear, food processing, etc.) are stronger represented in the South.

Compared to the Northern provinces, the Southern provinces seem to be more dynamic and market-oriented. Norwegian companies may find the business environment in the South to be more transparent and active than the one in the North. However, since the main offices of the largest state owned corporations are located in Hanoi, cooperation and networking with these should be established at head office level in and around Hanoi.

Value (* ) is calculated at the current prices. Exchanged rate estimated at US$ 1 = VND 21,000
Source: General Statistics Office of Vietnam