Publication: Taking Stock, December 2016: An Update on Vietnam's Recent Economic Developments
Loading...
Published
2016-12
ISSN
Date
2016-12-14
Author(s)
Editor(s)
Abstract
Over recent decades, Vietnam’s agricultural sector has made enormous progress, realizing major gains in productivity and output and contributing to national goals related to food security, poverty reduction, social stability, and trade. Nevertheless, there are growing concerns related to the quality and sustainability of Vietnam’s agricultural growth and related patterns of development. A comparatively low quality of growth is manifested by low smallholder farmer profitability, considerable under-employment among agricultural workers, mixed or uncertain product quality and food safety, low value addition, and limited technological or institutionalinnovation. Some agricultural growth has come at the expense of the environment in the forms of deforestation, biodiversity loss, land degradation, water pollution, and greenhouse gas emissions. In most locations, agricultural growth has involved an increase in cropping areas or intensities and ever higher uses of inputs and natural resources. Hence, more output has come from more and more inputs and increasing environmental costs. Vietnamese agriculture now sits at a turning point. The sector now faces growing domestic competition—from cities, industry, and services—for labor, land and water. Rising labor costs are beginning to inhibit the sector’s ability to compete internationally as a low cost producer of bulk undifferentiated commodities. The country’s ruralyouth have rising aspirations for living standards. Vietnam’s expanding consumer class and trade partners are expecting higher standards, both for products and production practices. Going forward, Vietnam’s agriculture will need to generate ‘more from less’. That is, it will need to generate more economic value—and farmer and consumer welfare—using less natural and human resources and without degrading the environment. It will need to rebrand itself and increasingly compete on the bases of innovation, reliable supply, predictable quality, and assured food safety and environmental protection.
Link to Data Set
Citation
“World Bank. 2016. Taking Stock, December 2016: An Update on Vietnam's Recent Economic Developments. © World Bank. http://hdl.handle.net/10986/25748 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Taking Stock, December 2013(Hanoi, 2013-12)Macroeconomic stability in Vietnam is improving, underpinned by moderating inflation and strengthening external accounts. Headline Consumer Price Index (CPI) inflation has stabilized, aided by subdued credit growth and easing of food price increases. The decline in core inflation has been more gradual. Pressure on the Vietnamese currency has also eased substantially. A sustained recovery in Gross Domestic Product (GDP) growth remains hampered however by slow-moving structural reforms and global uncertainty. With rising pressures on the budget, the government is faced with some crucial fiscal policy choices, as it seeks to balance the objectives of economic expansion and macroeconomic stability. This paper explores crucial issues such as trade facilitation, competitiveness and growth, poverty and inequality, corruption and economic growth in Vietnam, the external economic environment, and recent economic developments in Vietnam.Publication Taking Stock, December 2020(World Bank, Hanoi, 2020-12-14)In these early days of December 2020, most Vietnamese must wear a face mask. The cause is not only the fear of COVID-19 (coronavirus), but also of polluted air which, in the country’s major cities, is four times more polluted than the safety level recommended by international agencies. Regrettably, even if the government has done a superb job containing the biggest and most recent pandemic, Vietnam is vulnerable to many health and environmental disasters. Beyond air pollution, which is killing an estimated 60,000 people every year, the country is exposed to coastal erosion, drought, and saline intrusion and landslide. The recent series of tropical storms in the central region, with over 240 casualties and a quarter million damaged or destroyed homes, has been another painful reminder of this fragility. This edition of the Taking Stock, after describing the recent trends in the Vietnamese economy, asks why Vietnam has not been as effective in dealing with environmental and climate challenges as with the COVID-19 crisis, which are arguably different but have also many similarities. The successful experience in implementing the right measures at the right time during the COVID-19 crisis deserves more attention as it can inspire policymakers in their commitment to address the environmental and climate challenges. First, the successful management of the pandemic has demonstrated (again) that it is better to be ready and to act early and boldly. Second, beyond vision and capacity, the ability to inspire experimentation and innovation is an effective way to change individual and collective behaviors, which is fundamental in the effort to cope with health and climate threats. By all standards, Vietnam has managed the COVID 19 crisis very well. The number of infections and deaths has been minimal, with few community infections since mid-September. Despite strict social distancing measures and an unprecedented global recession, Vietnam’s economy is expected to grow at 2.8 percent in 2020. Although this performance is about 4.2 percentage points lower than the country’s recent performance, Vietnam will remain in positive growth territory, while the world economy is expected to contract by at least 4 percent. In East Asia, only two other countries—China and Myanmar—are expected to report positive GDP growth this year. Vietnam’s economic resilience is explained by the behavior of both its domestic economy and its externalsector. After three weeks of national lockdown in April, most industrial and service activities rebounded as domestic consumers and investors regained confidence. Not only has the private sector reacted positively to the gradual easing of social distancing and mobility measures, but the government has changed the course of its fiscal policy to support the recovery. After three years of fiscal consolidation, the authorities acted decisively and accelerated the disbursement of the public investment program, which increased by about 40 percent between January and September compared to the same period a year ago. Concurrently, like most central banks, the accommodative monetary policy and temporary financial relief measures of the State Bank of Vietnam provides breathing space to affected businesses and people.Publication Taking Stock, December 2011(World Bank, Hanoi, 2011-12-06)Prospects for the global economy have become less certain in the second half of 2011, with significant increase in downside risks. Developing countries in East Asia are growing faster than developed countries, but they too are facing challenges due to a combination of reasons including: slower expansion in demand in developed countries; the impact of global uncertainty on investor sentiments; natural disasters; and the withdrawal of stimulus policies. Vietnam's growth slowed in 2011 compared to 2010, though it is still expected to reach around 5.8 percent. The external sector has remained relatively stable. The current account deficit declined in 2011, as export performance outpaced imports and remittances grew robustly. Both import and export values saw a dramatic rise, mostly because of higher commodities prices. External debt remains sustainable, as the current account deficit was more than covered through medium-term capital inflows that are largely non debt-creating (foreign direct investments) or contracted on concessional terms (official development aid). Foreign direct investment inflows continued at a steady pace, although new commitments declined. International reserves increased in the first half of the year while the Vietnamese dong benefitted from a period of relative calm. In the last quarter of the year, however, exchange rate fluctuations increased due to volatility in gold prices, deepening uncertainties and the seasonal increase in demand for foreign currency as the year end approaches. In the longer run, Vietnam's ambition to maintain high growth into the next decade will require as bold a set of reforms as the one adopted with Doi Moi. The challenge is arguably more difficult than the previous one, and few countries in the world have accomplished it. Vietnam is endowed with a young and hard-working labor force. This is a vital asset to meet the country's ambitious goals, if the country manages to equip itself with relevant skills, and match it with necessary capital. It also needs a level-playing field to maximize its potential. As people become more educated and production becomes more sophisticated, demands for predictability, trust and a level playing field will grow. Transparency is a critical element in this. Concentration of economic power in a small number of large firms undermines efforts at creating a level playing field. Large firms and industries that circumvent rules to their advantage are promoting corruption, and undermining efficiency, which damages the country's potential. The governance challenges are complex, but Vietnam's medium term outlook will be much better if they are addressed sooner rather than later.Publication Taking Stock, July 2014(Hanoi, 2014-07)Global growth is projected to pick up to 3.4 percent in 2015 and 3.5 percent in 2016, propelled by highincome countries. Developing country growth will benefit from these tailwinds, with growth projected to increase from 4.8 percent in 2014 to 5.5 percent in 2016 broadly in line with potential. Global growth projections for 2014, however, have been marked down from 3.2 percent to 2.8 percent on account of the bumpy start this year, buffeted by poor weather in the United States, financial market turbulence and the conflict in Ukraine. The outlook for the East Asia and the Pacific region continues to reflect several counterbalancing factors, including domestic policy adjustment, volatile financing conditions, political crisis in Thailand, and sustained recovery in global demand for exports. Regional GDP growth is expected to slow down slightly to 7.0 percent by 2016, about 2 percentage points slower than the pre-crisis boom years but broadly in line with potential. Regional risks include volatility and eventual tightening of global financing conditions, possible setbacks in China s restructuring and a weaker contribution from net exports than assumed in the baseline. Potential escalation of regional political tensions presents additional risk to the outlook.Publication Senegal Economic Update, December 2014 : Learning from the Past for a Better Future(Washington, DC, 2014-12)Gross domestic product (GDP) growth was a disappointing 3.5 percent in 2013. It remained largely unchanged compared to 2012, reflecting a decline in cereal production and stagnation in the industrial sector. Services continue to drive the economy. The economic outlook for 2014 was more positive, but poor rainfall and the Ebola outbreak have forced downward revisions in GDP growth projections, now expected to reach 4.5 percent. The plan Senegal emergent aims to break with this trend, with a welcome focus on higher economic growth. However, its ambitions may exceed available resources and will likely depend on accelerated reforms and a strong private sector response. This first economic update begins with an overview of the macroeconomic situation in Senegal, starting with a review of 2013 before examining the initial results of 2014. After a brief look at the challenges posed by unemployment and poverty, the report turns to an assessment of the growth strategy. It presents analysis of past performance since 1990 in order to understand better what needs to be done differently. The report concludes with a few recommendations.
Users also downloaded
Showing related downloaded files
Publication Global Economic Prospects, June 2025(Washington, DC: World Bank, 2025-06-10)The global economy is facing another substantial headwind, emanating largely from an increase in trade tensions and heightened global policy uncertainty. For emerging market and developing economies (EMDEs), the ability to boost job creation and reduce extreme poverty has declined. Key downside risks include a further escalation of trade barriers and continued policy uncertainty. These challenges are exacerbated by subdued foreign direct investment into EMDEs. Global cooperation is needed to restore a more stable international trade environment and scale up support for vulnerable countries grappling with conflict, debt burdens, and climate change. Domestic policy action is also critical to contain inflation risks and strengthen fiscal resilience. To accelerate job creation and long-term growth, structural reforms must focus on raising institutional quality, attracting private investment, and strengthening human capital and labor markets. Countries in fragile and conflict situations face daunting development challenges that will require tailored domestic policy reforms and well-coordinated multilateral support.Publication Global Economic Prospects, January 2025(Washington, DC: World Bank, 2025-01-16)Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.Publication Digital Africa(Washington, DC: World Bank, 2023-03-13)All African countries need better and more jobs for their growing populations. "Digital Africa: Technological Transformation for Jobs" shows that broader use of productivity-enhancing, digital technologies by enterprises and households is imperative to generate such jobs, including for lower-skilled people. At the same time, it can support not only countries’ short-term objective of postpandemic economic recovery but also their vision of economic transformation with more inclusive growth. These outcomes are not automatic, however. Mobile internet availability has increased throughout the continent in recent years, but Africa’s uptake gap is the highest in the world. Areas with at least 3G mobile internet service now cover 84 percent of Africa’s population, but only 22 percent uses such services. And the average African business lags in the use of smartphones and computers as well as more sophisticated digital technologies that catalyze further productivity gains. Two issues explain the usage gap: affordability of these new technologies and willingness to use them. For the 40 percent of Africans below the extreme poverty line, mobile data plans alone would cost one-third of their incomes—in addition to the price of access devices, apps, and electricity. Data plans for small- and medium-size businesses are also more expensive than in other regions. Moreover, shortcomings in the quality of internet services—and in the supply of attractive, skills-appropriate apps that promote entrepreneurship and raise earnings—dampen people’s willingness to use them. For those countries already using these technologies, the development payoffs are significant. New empirical studies for this report add to the rapidly growing evidence that mobile internet availability directly raises enterprise productivity, increases jobs, and reduces poverty throughout Africa. To realize these and other benefits more widely, Africa’s countries must implement complementary and mutually reinforcing policies to strengthen both consumers’ ability to pay and willingness to use digital technologies. These interventions must prioritize productive use to generate large numbers of inclusive jobs in a region poised to benefit from a massive, youthful workforce—one projected to become the world’s largest by the end of this century.Publication Doing Business 2020(Washington, DC: World Bank, 2020)Doing Business 2020 is the 17th in a series of annual studies investigating the regulations that enhance business activity and those that constrain it. It provides quantitative indicators covering 12 areas of the business environment in 190 economies. The goal of the Doing Business series is to provide objective data for use by governments in designing sound business regulatory policies and to encourage research on the important dimensions of the regulatory environment for firms.Publication Reclaiming the Lost Century of Growth: Building Learning Economies in Latin America and the Caribbean(Washington, DC: World Bank, 2025-06-06)Update: The Spanish version of the full book was published on September 9, 2025. Latin America and the Caribbean has lost not decades but a century of growth due to its inability to learn—to identify, adapt, and implement the new technologies emerging since the Second Industrial Revolution. Superstars like Argentina, Chile, and Uruguay fell behind peers like France and Germany, while the entire region retrogressed in industries it once dominated and was unable to take advantage of new opportunities that propelled similarly lagging countries to high-income status. The report shows that this remains the case today as the region’s firms continue to lag in assimilating new technologies. However, it argues that Latin America and the Caribbean can reclaim the lost century by building learning economies, creating the human capital, institutions, and incentives needed to increase the demand for knowledge, facilitate the flow of new ideas, and foment the process of experimentation.