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0 investor FDI 2009 10

Labor force ranking chart 11

Introduction

As we know Asia has been transformed since the World War II. A remarkable record of high and sustained economic growth has been produced and demonstrated by economic power .The first Asian country recovering from the World War II was Japan. And from Japan, to China, to India, and to Vietnam, sequentially the economic power of Asia has drawn the world’s attention.

Each of Asian country has unique factors contributing to its respective economic success. At this time, the economy of Vietnam is a center of attention because it has a stable economy and high level of continuing to drive positive growth, and these are accompanied with strong development of science and technology. In fact, Vietnam has taken on a vigorous drive to reform its economy. The reforms are directed at developing major industries such as information technology (IT), telecommunications, financial markets and creating a good business environment for investors (FDI). And we can see that the results are a stable economy with rapid growth rates and the presence of many multinational companies in Vietnam. But most importantly, there is a substantial change in Vietnam’s economic structure after becoming a member of the WTO, which is to transform from an agricultural industry to industrial and service industries.

If Vietnam remains economically stable and continues to drive positive growth. Vietnam is highly hoped to be the next Asian Tiger, and also can become one of the fastest growing economies in the world like China.

Main body

The economy of Vietnam has been growing year by year at a vigorous pace after becoming a member of the WTO since 2007. Many ideas have been raised to keep this continued growth path. But we still have some drawbacks to deal with in the coming years. In this report, we will focus on analyzing GDP, CPI and FDI rates and other factors, which provide us with an overview of Vietnam’s current position.

GDP of Vietnam

GDP definition

GDP is the abbreviation for Gross Domestic Product, which shows the total value of goods or services produced in a country in a given year. Put simply, GDP is the total household spending, business investment, government spending plus the difference between exports and imports.

GDP rates

The percentage of Vietnam’s GDP can provide us with an overview of our current level of health and growth of economy. The chart above shows that in 2007 the GDP of Vietnam was 5.3 percent, and in next two years there was a sharp decline in GDP figures, only reaching 6.2 percent and 5.3 percent in 2008 and 2009 respectively. Here are a few reasons for this:

The first reason was due to exports. Vietnam has been very successful in developing industries for export, but in the year of 2009 the demand for exports was significantly reduced. The exports of Asian countries have 'fallen' at the alarming rate because consumers in the U.S., Europe and other markets were cutting down on expenditures.

The second reason was caused by consumer spending. With the unemployment rate increased (due to problems arising in areas of manufacturing exports) and reduced employees’ income due to high inflation in 2008 (22%), households spending money was cut down.

The third reason was