Introduction to Vietnam

The Socialist Republic of Vietnam, commonly referred to as Vietnam, is a country in Southeast Asia, that borders the Gulf of Thailand, Gulf of Tonkin, and the East Sea, alongside China, Laos, and Cambodia. Vietnam is a rapidly developing socialist-oriented market economy. Over the past twenty odd years, Vietnam has made a shift from a centrally planned economy to a socialist-oriented market economy. The economy has experienced rapid growth during the period of transition and today, Vietnam is in the process of integrating into the world’s economy.

Economic growth and structure

Vietnam’s economy in 2017 marked a record of economic growth, attracting foreign investment, turnover of import and export goods, and tourism services. For the first time in many years, Vietnam has either reached or surpassed all of its 13 annual socio-economic targets. However, the state budget deficit, low-productive labour and natural disasters are still challenges to the economy. Despite these difficulties, growth remains. The gross domestic product (GDP) in 2017 reached 6.81% compared to 2016 exceeding the target of 6.7%. This shows a continual increase over the years from 2011 to 2016. The scale of the economy in 2017 reached VND5.007,9 trillion at current prices while the GDP per capita reached VND53.3 million, equivalent to USD2,385, rising by USD170 compared to 2016.

In 2017, Vietnam witnessed an increase of around 21% year-on-year for both export and import turnovers, reaching USD213.77 billion and USD211.1 billion, respectively. The majority of these numbers still came from industry, construction and service sectors, accounting for 74% of Vietnam GDP in general. Particularly, the distribution of GDP across economic sectors shows that agricultural, forestry and aquaculture contributed 15.34%, Industry and construction accounted for 33.34%, the service sector for 41.32% and 10% from product tax excepting subsidies on products. The figures for 2016 were 16.32%, 32.72%, 40.92% and 10.04%, respectively. Foreign direct investment in 2017 reached its highest point over 10 years at USD17.5 billion, expanding 10.8% against the level of the same period in 2016. Year 2017 also witnessed a new milestone in the number of total import and export values at over USD400 billion.

Although the United States of America did not join the Trans-Pacific Partnership Agreement (TPP) in 2017, Vietnam’s import and exports still anticipate growth due to the twelve signatories of the Free Trade Agreements and EU-Vietnam Free Trade Agreement expected to take effect in early 2018.

In addition, tourism activities in 2017 earned an impressive result as the number of foreign tourists hit a record high of nearly 13 million people, an increase of 29.1% compared to the same period in 2016. Thus, revenue generated from the tourism sector was estimated at VND35.9 trillion, increasing 10.4% over the previous year’s numbers. Accordingly, tourism is expected to become a key sector and contribute 10% to the economy by 2020.

Population size and language

The total population in Vietnam was estimated at 93.7 million people in 2017, growth of 1.07% over 2016. Vietnamese is the official language. Vietnamese is a tonal language in which the rise and fall of the voice can change the meaning of the words. In written form, Vietnamese uses the Roman alphabet and accent marks to show tones. There are other languages spoken as well: English, Chinese, Khmer, Cham and other minority languages spoken by tribes inhabiting the mountainous regions. English is the most popular foreign language and widely spoken in some urban areas. Moreover, English study is obligatory in most schools.

Business hours/Time zone

A normal working day in Vietnam starts between 7:00 am and 8:30 am and ends between 4:00 pm and 6:00 pm, from Monday to Friday and until noon on Saturday, leaving the afternoon and Sunday off. Lunch is taken very seriously and virtually everything shuts down between noon and 1:30 pm. Government workers tend to take longer breaks between 11:30 am and 2:00 pm.

The Time zone is (UTC+07:00).

Related Chapters

Culture and religion in Vietnam

Economy of Vietnam

The Government

Judiciary

Legal System

Regulatory Framework

Banking & Finance

Capital Markets

Land & Housing

Labour Law

Taxes

Intellectual Property

Selected Sector Regulations

Dispute Resolution



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