Vietnam Economic Development
http://www.worldbank.org/en/country/vietnam/overview
Vietnam is a development success story. Political and economic reforms (Đổi Mới) launched in 1986 have transformed Vietnam from one of the poorest countries in the world, with per capita income below $100, to a lower middle income country within a quarter of a century with per capita income of over $2,000 by the end of 2014. To date, Viet Nam has achieved most and in some cases surpassed a number of the Millennium Development Goals (MDGs), particularly with the goals on poverty reduction, education and gender equality.
Over the last few decades, Vietnam has made remarkable progress in reducing poverty. The percentage of people living in poverty dropped from almost 60% in the 1990s to less than 3% today. Vietnam’s growth rate has averaged 6.4% per year for the last decade, but it has begun to slow recently. In 2014, GDP growth was 6 %, projected to flatten in 2015 and start to pick up in 2016. Vietnam has managed to improve macroeconomic stability, with headline inflation falling from a peak of 23% in August 2011 to about 4.1% for 2014.
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Viet Nam has exhibited one of the highest rates of economic growth and poverty reduction in the world, albeit one accompanied by higher inequality.
Several factors underpinned these improvements. First was pragmatic party leadership, which encouraged both internal debate and policy innovations based on a trial-and-error approach. Second were strong governing and market institutions. Third was a wide-reaching network of infrastructure that enabled efficient and effective implementation of economic reform policies. Fourth was equitable initial investment in human development, which meant the populace was primed to take advantage of economic opportunities. Fourth, equitable land reform with targeted investment in agriculture brought significant increases in agricultural yields and poverty reduction in rural areas.
Viet Nam has been able to sustain this progress for two decades, thanks to the effective adoption and implementation of Doi Moi; continued equitable land reform; pragmatic, careful and sequenced liberalisation; and macroeconomic reforms and the ability to consistently attract foreign investment. A strong sense of social solidarity and equity has also contributed to effective policy and implementation, as well as to continued investment in human development (albeit not benefiting all), leading to significant improvements in human capital, thus enabling people to take advantage of market opportunities. Remaining challenges include rising inequality, environmental degradation and corruption.
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