Economic 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. economic stagnation marked the period after reunification from 1975 to 1985. in 1986, the sixth party congress approved a broad economic reform package that introduced market reforms and set the groundwork for vietnam's improved investment climate. substantial progress was achieved from 1986 to 1997 in moving forward from an extremely low level of development and significantly reducing poverty. 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 8.5% in 2007. 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 900% from 2001 to 2007. vietnam joined the wto in january 2007, following over a decade long negotiation process. wto membership has provided vietnam an anchor to the global market and reinforced the domestic economic reform process. 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 less than 20% in 2007. 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 one-and-a-half million people every year. in an effort to stem high inflation which took off in 2007, early in 2008 vietnamese authorities began to raise benchmark interest rates and reserve requirements. hanoi is targeting an economic growth rate of 7.5-8% during the next four years.
Environmental Issues
Logging and slash-and-burn agricultural practices contribute to deforestation and soil degradation; water pollution and overfishing threaten marine life populations; groundwater contamination limits potable water supply; growing urban industrialization and population migration are rapidly degrading environment in hanoi and ho chi minh city
Government Type
Communist state
Population
86,116,560 (july 2008 est.)
Location
Southeastern asia, bordering the gulf of thailand, gulf of tonkin, and south china sea, alongside china, laos, and cambodia
Area
Total: 329,560 sq km
land: 325,360 sq km
water: 4,200 sq km
Slightly larger than new mexico
Country Aliases
Conventional long form: socialist republic of vietnam
conventional short form: vietnam
local long form: cong hoa xa hoi chu nghia viet nam
local short form: viet nam
abbreviation: srv
Capital
Name: hanoi
geographic coordinates: 21 02 n, 105 51 e
time difference: utc+7 (12 hours ahead of washington, dc during standard time)
Military Service
18 years of age (male) for compulsory military service; females may volunteer for active duty military service; conscript service obligation - 2 years (3 to 4 years in the navy); 18-45 years of age (male) or 18-40 years of age (female) for militia force or self defense forces (2006)
International Disputes
Southeast asian states have enhanced border surveillance to check the spread of avian flu; cambodia and laos protest vietnamese squatters and armed encroachments along border; an estimated 300,000 vietnamese refugees reside in china; establishment of a maritime boundary with cambodia is hampered by unresolved dispute over the sovereignty of offshore islands; demarcation of the china-vietnam boundary proceeds slowly and although the maritime boundary delimitation and fisheries agreements were ratified in june 2004, implementation has been delayed; china occupies the paracel islands also claimed by vietnam and taiwan; involved in complex dispute with china, malaysia, philippines, taiwan, and possibly brunei over the spratly islands; the 2002 "declaration on the conduct of parties in the south china sea" has eased tensions but falls short of a legally binding "code of conduct" desired by several of the disputants; vietnam continues to expand construction of facilities in the spratly islands; in march 2005, the national oil companies of china, the philippines, and vietnam signed a joint accord to conduct marine seismic activities in the spratly islands
Sources: Central Intelligence Agency (CIA)
