Changes

==Economy==

==Economy==

Economic stagnation marked the period after reunification from 1975 to 1985. In 1986, the Sixth Party Congress approved a broad economic reform package called "Doi Moi" (renovation) that introduced market reforms and dramatically improved Vietnam's business climate. Vietnam became one of the fastest-growing economies in the world, averaging around 8% annual gross domestic product (GDP) growth from 1990 to 1997 and 6.5% from 1998-2003. In 2004-2005, GDP grew over 8% annually. Vietnam's inflation rate, as measured by the consumer price index, which stood at an annual rate of over 300% in 1987, was below 4% from 1997 (except in 1998 when it rose to 9.2%) until 2003. However, in 2004 the consumer price index increased to 9.5%, dropping in 2006 to 7.5%. Average annual foreign investment commitment has risen sharply as a result of the U.S.-Vietnam Bilateral Trade Agreement and Vietnam's drive toward membership in the World Trade Organization (WTO). In 2007, investment commitment is expected again to reach $10 billion, matching the $10 billion level of 2006. The average Vietnamese savings rate is about 30%. From 1990 to 2005, agricultural production nearly doubled, transforming Vietnam from a net food importer to the world's second-largest exporter of rice.

Economic stagnation marked the period after reunification from 1975 to 1985. In 1986, the Sixth Party Congress approved a broad economic reform package called "Doi Moi" (renovation) that introduced market reforms and dramatically improved Vietnam's business climate. Vietnam became one of the fastest-growing economies in the world, averaging around 8% annual gross domestic product (GDP) growth from 1990 to 1997 and 6.5% from 1998-2003. In 2004-2005, GDP grew over 8% annually. Vietnam's inflation rate, as measured by the consumer price index, which stood at an annual rate of over 300% in 1987, was below 4% from 1997 (except in 1998 when it rose to 9.2%) until 2003. However, in 2004 the consumer price index increased to 9.5%, dropping in 2006 to 7.5%. Average annual foreign investment commitment has risen sharply as a result of the U.S.-Vietnam Bilateral Trade Agreement and Vietnam's drive toward membership in the World Trade Organization (WTO). In 2007, investment commitment is expected again to reach $10 billion, matching the $10 billion level of 2006. The average Vietnamese savings rate is about 30%. From 1990 to 2005, agricultural production nearly doubled, transforming Vietnam from a net food importer to the world's second-largest exporter of rice.

*GDP (2006): $61 billion.

*GDP (2006): $61 billion.

From the late 1970s until the 1990s, Vietnam was heavily dependent on the Soviet Union and its allies for trade and economic assistance. To compensate for drastic cuts in Soviet-bloc support after 1989, Vietnam liberalized trade, devalued its exchange rate to increase exports, and embarked on a policy of regional and international economic re-integration. Vietnam has demonstrated its commitment to trade liberalization in recent years, and integration with the world economy has become one of the cornerstones of its reform program. Vietnam has locked in its intention to create a more competitive and open economy by committing to several comprehensive international trade agreements, including the Association of Southeast Asian Nations (ASEAN) Free Trade Area (AFTA) and the U.S.-Vietnam Bilateral Trade Agreement (BTA). Vietnam's accession to the World Trade Organization will further integrate Vietnam into the global economy.

From the late 1970s until the 1990s, Vietnam was heavily dependent on the Soviet Union and its allies for trade and economic assistance. To compensate for drastic cuts in Soviet-bloc support after 1989, Vietnam liberalized trade, devalued its exchange rate to increase exports, and embarked on a policy of regional and international economic re-integration. Vietnam has demonstrated its commitment to trade liberalization in recent years, and integration with the world economy has become one of the cornerstones of its reform program. Vietnam has locked in its intention to create a more competitive and open economy by committing to several comprehensive international trade agreements, including the Association of Southeast Asian Nations (ASEAN) Free Trade Area (AFTA) and the U.S.-Vietnam Bilateral Trade Agreement (BTA). Vietnam's accession to the World Trade Organization will further integrate Vietnam into the global economy.

As a result of these reforms, exports expanded significantly, growing by as much as 20%-30% in some years. In 2005, exports accounted for 63% of GDP. Imports have also grown rapidly, and Vietnam has a significant trade deficit (forecast to be $4.8 billion in 2006). Vietnam’s total external debt, accounting for 32.5% of GDP in 2005, was estimated at around $17.2 billion.  

As a result of these reforms, exports expanded significantly, growing by as much as 20%-30% in some years. In 2005, exports accounted for 63% of GDP. Imports have also grown rapidly, and Vietnam has a significant trade deficit (forecast to be $4.8 billion in 2006). Vietnam’s total external debt, accounting for 32.5% of GDP in 2005, was estimated at around $17.2 billion.

 

 

 

==History==

==History==