SPECIAL ECONOMIC BULLETIN 2009
MINISTRY OF FOREIGN AFFAIRS OF VIETNAM Department of Economic Affairs
January, 2009
January, 2009
Special Economic Bulletin 2009
Inside this issue: Page
Vietnam economic review in 2008 and outlook in 2009 4
Vietnam’s response to the global financial crisis 10
Vietnam’s international economic integration update in 2008 14
Vietnam’s investment environment update in 2008 18
ODA mobilization and utilization in Vietnam 24
Communication between the Government and business circles 29
What the world says about Vietnam 33
Annex
Vietnam’s export directions in 2009
Solutions to promote tourism in Vietnam in 2009
Vietnam’s energy development strategy towards 2020 and 2050
Vietnam’s highway network development plan by 2020 and vi-sion after 2020
National program on response to climate change
36
Page 4 - Special Economic Bulletin 2009
VIETNAM ECONOMIC REVIEW IN 2008 AND OUTLOOK IN 2009
After 2 years of WTO membership, Vietnam has been opened to various develop-
ment opportunities but also faced with different challenges. In 2008, the world economic
slump caused by the global financial crisis, volatility in prices of crude oil, food and com-
modities as well as inherent weaknesses produced a lot of difficulties for Vietnam’s econ-
omy, particularly high inflation and large trade deficit. Given the resolute implementation
of the 8-point- policy package of inflation curbing, macroeconomic stabilization and social
welfare measures since early 2008, Vietnam’s economy has witnessed significantly posi-
tive moves. Economic growth was sustained, monetary and financial markets remained sta-
ble, inflation and trade deficit gradually declined and FDI inflows increased rapidly.
1. Vietnam economic review in 2008
1.1. Economic growth
The country’s gross domestic
product (GDP) grew by 6.23%, of
which agriculture, forestry and aqua-
culture sectors increased by 3.79%;
industrial and construction sectors
increased by 6.33%; and services in-
creased by 7.2%. The economic
growth in 2008 slowed down and was
lower than the average of the past 5
years.
Despite negative impacts of
climate change, natural disasters and
floods, agriculture production
achieved positive results. The total
agriculture output in 2008 increased
by 5.6%. Rice output increased sig-
nificantly, thus ensuring the national
food security and export.
Industrial production and construction faced with many difficulties due to the world
economic downturn caused by the global financial turbulence and surge in prices of fuel
and basic commodities. Nevertheless, industrial production output increased by 14.6%, of
which the State, non-state and FDI sectors grew by 4%, 18.8% and 18.6% respectively.
Production output of extractive industries declined by 3.5%, manufacture and processing
industries increased by 16%; and water, gas and electricity industries went up by 13.4%.
Total retail sales and services revenue in 2008 were estimated to grow by 31%.
Many tourism attractions were upgraded and improved. By the end of 2008, the number of
international arrivals in Vietnam increased by 0.6% compared with 2007.
VIETNAM ECONOMIC REVIEW IN 2008
8.4 8.178.48
6.23
0
1
2
3
4
5
6
7
8
9
2005 2006 2007 2008
GDP growth in recent years (%)
Source: General Statistics Office
1.2. Foreign trade
Despite unfavorable economy conditions and keen competition, export turnover has
sustained rapid growth. Total export turnover in 2008 reached 62.9 billion USD, up by
29.5% on year-on-year basis. Some main export products continue to maintain a high
growth rate such as crude oil 23.1% (10.5 billion USD); textile 17.5% (9.1 billion USD);
aquatic product 21.2% (4.6 billion USD); shoes 17.6% (4.7 billion USD); rice 89.1% (2.7
billion USD); electronic products and computer 29.5% (2.7 billion USD) and coal 50.5%
(1.4 billion USD).
Vietnam’s export has suffered from losses caused by sharp drop in prices of its
major exports (crude oil, rice, rubber, etc...). Demand in key export markets such as the
U.S., Japan and EU, which occupied nearly 50% of the export volume of Vietnam, has
contracted. Since September when the financial crisis intensified, Vietnam’s monthly
export has slowed down significantly. Export value in November was just 4.8 billion USD,
lower than previous months, namely October with 5.1 billion USD, September with 5.3
billion and August with 6.1 billion USD.
Import turnover in 2008 reached 80.4 billion USD, up by 28.3% compared with
2007. The volume of most imports grew rapidly due to climbing import prices (fertilizer
prices up by 94.2%, fuel up by 53.5%, steel up by 45.8%). Monthly trade deficit has
reduced rapidly since the middle of the year, however the total trade deficit still reached
around 17.5 billion USD in 2008, equal to 27.8% of the export turnover and equivalent to
the deficit level of last year. Major reasons for the large trade deficit are: (i) The climb-up
of most imports, particularly fuel, materials and equipments, which could not be produced
domestically; (ii) The share of processed exports remain modest, whereas most imports are
processed goods, machinery and equipments; (ii) Tariff reduction and regulation
streamline in compliance with the WTO commitments have facilitated operations of
trading companies, including importers.
1.3. Investment
Total investment capital for development in 2008 reached 637.3 trillion VND (about
1300
800900
500700
500400
0
500
1000
1500
Jun Jul Aug Sep Oct Nov Dec
VIETNAM ECONOMIC REVIEW IN 2008
Special Economic Bulletin 2009 - Page 5
Trade deficit (million USD)
Source: General Statistics Office
Page 6 - Special Economic Bulletin 2009
38.8 billion USD), accounting for 43.1% GDP, up by 22.2% compared with 2007, of
which public investment was 184.4 trillion VND (around 11.3 billion USD), investment
by non-State sectors was 263 trillion VND (about 16 billion USD) and disbursed foreign
direct investment (FDI) was 11.5 billion USD, etc...
Registered FDI
capital climbed up to a
record level of over 64
billion USD, tripling the
volume of last year. Several
projects has a registered
capital as high as 3.5 - 7.8
billion USD. Despite that
fact, FDI inflows into
Vietnam are forecasted to
slowdown in the upcoming
time due to downward trend
of international investment
caused by credit crunch and
tougher terms in the
international financial markets. However, in the global uncertain environment, capital
flows tend to flight into safe destinations. As a result, provided that stable-macroeconomic
conditions are sustained, problems in infrastructure, institutions and human resources are
settled, Vietnam would continue to be an attractive investment destination in the region.
1.4. Given the resolute implementation of the 8-point- policy package for inflation
control and macroeconomic stabilization, monthly consumer price index (CPI) has
declined rapidly since mid-year. In fourth quarter, CPI plunged to negative figures with -
0,19% in October, -0,76%
in Novermber and -0,68%
in December. However, the
inflation rate for the whole
year remained at a high
level of 22,97%, though
still lower than previously
forecasted figures. Other
macroeconomic indices
were kept such as
government’s revenue and
spending, credit growth,
international payment
balance, foreign exchange
reserve, etc... Foreign debt
was controlled within a safe
range.
Financial and banking systems have not been exposed to direct impacts by the
VIETNAM ECONOMIC REVIEW IN 2008
Foreign Direct Investment (billion USD)
2.38
3.562.99
2.2
3.91
2.14
1.131.56
0.18-0.19
-0.76-0.68-1
0
1
2
3
4
5
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Monthly CPI (%)
5.729.9
20.3
64
0
10
20
30
40
50
60
70
2005 2006 2007 2008
Source: General Statistics Office
Source: General Statistics Office
global financial stresses because the level of Vietnam’s financial integration with the world
finance remains modest. However, deposits in foreign banks may get more risks. As
businesses have been facing difficulties and "frozen" property markets have prolonged,
some borrowers may have failed to pay debt. And as a result, non- performing loan may
increase. In the context of global financial uncertainty, since foreign investors may
restructure their portfolio or rechannel investment to safer assets for hedging, the
Vietnam’s stock markets are experiencing a sharp downward trend. The VN Index dropped
from over 1.000 points in early 2008 to around 300 points in late 2008.
2. Economic outlook in 2009
The donor community and
numerous international scholars shared
a view that the medium- term outlook
of Vietnam remained favorable despite
the current economic troubles because
of its strengthened fundamental factors:
(i) Socio- political stability; (ii) The
Government’s consistent and strong
commitment to reform and international
integration acceleration; (iii) The
implementation of WTO commitments
facilitates a more favorable business
environment; (iv) Young labor abundance. According to Professor Michael Porter
(Harvard Business School), in the medium term, with “appropriate economic strategy“
Vietnam could be well qualified for a “manufacturing base”, a “node in Asian value chain”
and a services hub in Indochina. With those advantages and fundamental factors, the
expectation of international investors transformed into huge capital inflows into Vietnam
in 2008 despite its short-term economic challenges.
In the short term, economic growth in 2008 slowed down due to adverse impacts by
the outside environment. Given the worse condition of the world economy, 2009 continues
to be a challenging year for Vietnam’s economy. The objectives were set for 2009 as keep-
ing inflation under control, ensuring macroeconomic stability, sustaining appropriate eco-
nomic growth, proactively preventing economic slowdown, ensuring social welfare and
effectively strengthening international economic integration and cooperation.
- Economic growth is targeted to increase by 6.5%, and total investment would
account for 39.5% GDP in 2009. The World Bank (WB) also forecasted that Vietnam’s
economy would grow by 6.5% in the next year. Given downward risks of the global
economy, some international institutions (IMF, ADB, etc...) forecasted that Vietnam would
slowdown further with a growth rate of 5%.
- With lower prices of commodities, inflation rate in Vietnam would decline faster to
15% or lower. According to IMF’s forecast, inflation is even likely to reduce to one-digit
figure by the end of 2009.
- Export volume is targeted to increase by 13% in 2009. The trade deificit is
VIETNAM ECONOMIC REVIEW IN 2008
Special Economic Bulletin 2009 - Page 7
“Despite the economic turbulence this year
and a difficult year ahead, the medium- term out-
look for Vietnam remains favorable, provided
that the government sustains the momentum of
economic reforms that have brought so much
success this decade”
Statement by World Bank at the Consultative
Group Meeting for Vietnam, Hanoi, 4-5 Decem-
ber 2008
Page 8 - Special Economic Bulletin 2009
forecasted to continue downward trend because of declined import prices, particularly
prices of oil and basic commodities. After Dung Quat oil refinery complex with the 6.5
million-ton-oil capacity being put into full operation in March 2009, a significant portion
of existing imported fuel and petrolium-based materials (like petrol, gasoline, oil
derivatives, fertilizer, plastic, etc...) shall be supplied in Vietnam, and trade deficit may, as
a result, decrease.
In an effort to mitigate the adverse impacts by the global financial crisis, Vietnam is
resolutely expediting 5-point-stimulus policy measures to contain economic slowdown,
sustain economic growth with a financial stimulus package worth of around 6 billion USD
in 2009, in which focuses are: (i) To promote production and export; (ii) Investment and
consumption demand leverage; (iii) To introduce flexible and effective monetary and fiscal
policies; (iv) To accelerate the implementation of poverty reduction programs and ensure
social welfare. The shift of priority from inflation control to growth stimulation in
Vietnam is viewed by international community to be indispensable, flexible and
appropriate in the context of global economic recession and deflation. However, unlike
other regional countries, remnants of high inflation and trade deficit in Vietnam might
linger over the year of 2009. And it must, therefore, be prudent in economic stimulus in
order to secure both macroeconomic stability and growth.
To unleash growth
potentials, particularly
taking advantage of rapid
economic growth recovery
after the global financial
crisis, beside the above
short-term measures,
Vietnam is trying its best
to strengthen the
foundation for sustainable
growth in the upcoming
years, with the following
measures:
(i) To consistently
gear up and enhance
international economic
integration, making full
use of post-WTO accession opportunities;
(ii) To accelerate the improvement of the legal system and market economic
institutions;
(iii) To speed up the development of key socio- economic infrastructure, notably
important transport infrastructures in order to solve ”bottle-necks” and enhance the
competitiveness of businesses and the whole economy;
(iv) To attach more importance to human resource development, particularly skilled
VIETNAM ECONOMIC REVIEW IN 2008
Monthly meeting of the Cabinet in December, 2008 to discuss measures to pre-
vent economic slowdown and stimulate the economy.
workforce with a view to attracting high- tech and high- value added investment, and to
accelerate the shift in the economic and export structures;
(v) To facilitate the development of businesses of different economic sectors; to
speed up SOEs reform, which focuses on equitization;
(vi) To effectively implement the National Program on reponse to global climate
change in an effort to mitigate its adverse impacts on agriculture production and rural
living;
(vii) To expand social welfare networks in order to support vulnerable people; to
enhance sustainable poverty reduction and make sure the poor could enjoy the fruits that
economic growth would bring about.
VIETNAM ECONOMIC REVIEW IN 2008
Special Economic Bulletin 2009 - Page 9
Page 10 - Special Economic Bulletin 2009
VIETNAM’S RESPONSE TO THE GLOBAL FINANCIAL CRISIS
In early 2008, the Vietnam’s economy faced with numerous difficulties, particularly
accelerating inflation and widening trade deficit, due to negative impacts of the global
economic downturn as well as hikes in prices of crude oil, food, and commodities. From
March 2008, Vietnam had resolutely implemented a policy package of macro- economic
stabilization and inflation control, comprising of 8 measures that focused on monetary
tightening and pulic investment cut-down. Basic interest rate had increaded to 12% (from
8%) and then to 14%. Inefficient or unnecessary projects had been cancelled or
postponed... As a result, since mid 2008, there were positive moves in macro- economic
condition with sharp drop in inflation and trade deficit, as well as stable monetary and
financial markets. FDI inflows into Vietnam continued to increase roburstly, demonstrating
the expectation and confidence of foreign investors towards a good long-term development
prospect of Vietnam’s economy.
Since September 2008 when the finan-
cial crisis in the U.S. intensified and evolved
into a global financial crisis, the global econ-
omy has been experiencing a sharp down-
turn. Many developed economies have slid
into recession while developing countries
have faced with a lot of difficulties. Many
countries have aggressively carried out
strong economic stimulus packages such as
the U.S. (168 billion USD), China (586 bil-
lion USD), etc … As its financial and mone-
tary linkages with developed countries re-
main modest, Vietnam has not been directly
affected by the global financial shock and
therefore no collapse or severe financial tur-
moil has been witnessed in Vietnam. How-
ever, as a small economy with increasingly
deep integration into the world economy, Vietnam seems to be vulnerable to indirect im-
pacts by unfavorable changes in the external economic environment through trade, invest-
ment and financial- monetary channels.
After the economy just cooled down, under the adverse impacts of the global
financial crisis, the threat of economic slump loomed large in Vietnam. Given significantly
declined inflation pressure and trade deficit, Vietnam has shifted the priority from inflation
control to economic stimulus. The Government has instructed the close monitoring of the
outside financial and economic movements for pro-active response to the adverse impacts
of the global financial crisis; safeguarding the banking system; strengthening close
surveillance of stock exchanges and real estate markets. To mitigate the impacts of
worsening external economic environment, Vietnam is concretely implementing 5 point-
policy package to prevent economic downturn, sustain economic growth and ensure social
welfare.
VIETNAM AND THE GLOBAL FINANCIAL CRISIS
Five-point policy package to stimulate economic growth
and ensure social welfare
1. To promote production and export
Agriculture: To tackle bottle-necks
and support agriculture development to
create more jobs and income for farmers.
To provide support for development of
seed production, materials, fertilizer, epi-
demic prevention, post- harvest technol-
ogy. To accelerate capital disbursement of
agricultural and rural infrastructure devel-
opment projects (e.g. irritation system,
fishing ports, aqua- production areas,
etc…). To support development of agricul-
tural promotion and service centers.
Industry: To give priority to devel-
opment of labor and domestic materials
intensive industries such as production of
consumption goods, construction materi-
als, mechanics and manufacture, ship building, fertilizer, supportive industries, oil chemis-
try, etc… with a view to make full use of domestic resources, materials and technology,
therefore to reduce the dependence on outside supply of equipments, materials and fuels.
Trade: To strengthen trade promotion and expand export markets in regions/ coun-
tries less vulnerable to the global financial crisis. To make best use of benefits from free
trade arrangements for increasing exports and reducing trade deficit such as Vietnam- Ja-
pan Economic Partnership Agreement, FTA between ASEAN and its dialogue partners
(China, Japan, South Korea, Australia, India), etc…
Infrastructure: To accelerate progress of major projects in energy, highways, air-
ports, seaports, rural transport networks, etc… To develop the national technology innova-
tion program with a view to increase hi- tech application and development for competitive-
ness improvement.
2. To encourage investment and domestic consumption
Investment: To accelerate capital allocation and implementation of important infra-
structure projects such as seaports, electricity, highways, irritation, schools, health-care,
etc… To make up-front allocation of nearly 100 million USD from the government bond
VIETNAM AND THE GLOBAL FINANCIAL CRISIS
Special Economic Bulletin 2009 - Page 11
In monetary field, in the fourth quarter of 2008, the basic interest rate was cut down
5 times from 14% to 8.5% in an effort to enhance liquidity in money markets, mitigating
adverse impacts of global economic turmoil on banking system and domestic enterprises.
Exchange rate band was expanded from ± 2% to ± 3%.
Prime Minister Nguyen Tan Dung: “ Mobilizing
collective efforts to prevent an economic downturn,
maintain growth and ensure social welfare”
Page 12 - Special Economic Bulletin 2009
for development and improvement of irrigation, dykes and natural disaster mitigation fa-
cilities. To speed up the disbursement of FDI and ODA projects, particularly those in in-
frastructure development, hi- tech product production, export and labor intensive projects.
To facilitate land procedures, capital access, site clearance, interest rates, etc… for enter-
prises of different economic sectors.
Domestic consumption: To introduce market prices of electricity, coal, clean water,
etc… according to the roadmap approved by the Government . To accelerate the expansion
of distribution networks of essential goods (e.g. food, gasoline, steel, cement, medicine,
etc…). To strengthen the quality and safety control of goods and services.
3. To implement flexible fiscal and monetary policies
Fiscal policy: For SMEs, to deduct 30% corporate income tax from the fourth quar-
ter of 2008 to the end of 2009 and for the remaining (70%) of this tax, the paying time
shall be extended up to 9 months. To expand the grace period for some industries such as
ship building, mechanics, etc…. To refund 90% VAT tax on input materials used for ex-
port production in case proper documents have not been presented. The remaining 10%
VAT shall be refunded if proper documents were presented. To reduce import tax on some
materials that could not be produced domestically. To increase import tax on luxury goods
in conformity with WTO commitments in order to reduce trade deficit.
Monetary policy: To exercise a flexible and effective monetary policy; to apply ex-
change rates in line with market mechanism with a view to encourage export, sustain mac-
roeconomic condition and balance of payment. To reduce required reserve and basic inter-
est rates in order to increase capital access for businesses, particularly SMEs and export
businesses.
4. To ensure social welfare: To accelerate the expedition of support for provinces
suffering natural disasters in terms of foods, housing development, epidemic prevention,
clean water, cultivation, etc… To increase investment in housing development for poor
people, workers in industrial parks, pupils and students. To support low- income employ-
ees, people suffering natural disaster losses and social support enjoyers. To early introduce
unemployment insurance. To increase the national food reserve for emergency support of
areas suffering natural disasters.
To fine-tune the implementation of poverty reduction programs, credit for poor peo-
ple, pupils and students. To increase investment and poverty reduction support for 61 poor
districts and step up the development of vocational training for rural labor in order to ac-
celerate production, job creation and income improvement.
5. To strengthen capacity for monitoring and forecasting of global economy and do-
mestic economy with a view to timely revise and adjust economic policies in line with the
reality. The Government instructed the relevant Ministries and local authorities to pro-
actively expedite market stabilization measures and to strengthen communication and dia-
logue with business circles and provide accurate and transparent socio- economic informa-
tion with a view to bolster public consensus and confidence in implementation of eco-
nomic stimulus measures.
VIETNAM AND THE GLOBAL FINANCIAL CRISIS
In fiscal field, Vietnam is planning an economic stimulus package worth of around 6
billion USD (110,000 billion VND), equivalent to 6 -7% its GDP, which is to be mobilized
from different sources (tax exemption and reduction; budget reserve, etc.). The stimulus
package demonstrates great effort and resolution of the Government of Vietnam to contain
economic slowdown. The stimulus package focuses on consumption and investment
leverage; infrastructure and hi- tech industries for strengthening long- term growth
foundation; promotion of labour and local materials intensive industries to creat jobs,
sustain economic growth and solve social problems.
Given the global economic recession, the shifting policy priority from inflation
control to maintain momentum of economic growth in Vietnam is essential and timely,
demonstrating a flexible and appropriate move in response to changes in the external
economic environment. Unlike other regional countries, vigilant for remnants of inflation
threat and trade deficit, Vietnam is implementing monetary loosing and fiscal expansion
flexibly and prudently with a view to harmonize economic growth and stability.
A part from the above measures, Vietnam supports and is in position to cooperate
with other countries to prevent the diffusion of the global financial crisis. Vietnam has
been actively strengthening the close coordination with regional countries under the
Chiang Mai Initiative within the ASEAN+3 framework to enhance regional monetary and
financial cooperation in order assist member countries in macroeconomic stabilization.
Vietnam has also been augmenting trade, investment cooperation with ASEAN,
ASEAN+1, ASEAN+3 and other countries in an effort to minimize the adverse impacts by
the global financial crisis and economic recession.
VIETNAM AND THE GLOBAL FINANCIAL CRISIS
Special Economic Bulletin 2009 - Page 13
Page 14 - Special Economic Bulletin 2009
VIETNAM ’S INTERNATIONAL ECONOMIC
INTEGRATION UPDATE IN 2008
Vietnam’s 2 year-old WTO’s
membership brings various opportunies.
Despite unfavorable global economic
condition, FDI inflows continued to increase
vigorously with a new high record of 64
billion USD in terms of registered capital in
2008, tripling the figure of last year. The
remarkable high ODA pledge of 5 billion
USD manifested the confidence and strong
support by the donor community for the
development of Vietnam. Export markets
have expanded to 150 countries with export
turnover of 62.9 billion USD, up by 29.5% on year-on-year basis. The implementation of
WTO’s commitments to market access, non-discrimination, subsidy abandon, policy
transparency and publicity, etc... has fostered a more sound competitive environment for
enterprises striving for excellence in term of quality, efficiency and productivity.
In 2008, Vietnam still maintained certain control on the following commodities:
tobacco, cigar, gasoline, petroleum, newspaper and magazine, aero-plane and spare parts,
video compact disk.
Vietnam complied all commitments to cut down import tariffs, among which some
tariff lines had been reduced earlier than the committed schedule such as: passenger buses,
milk... Import taxes on textile products were also reduced (averagely from 37.3% to
13.7%).
Up to now, 5 foreign banks
have been licensed to set up 100%
foreign invested banks in Vietnam,
including Standard Chartered, HSBC,
ANZ, Shinhan and Hong Leong Bank
Berhad.
As of 11th January 2007,
trading rights were granted to
distributors with foreign ownership of
less than 49%; from January 2009,
the foreign ownership cap shall be
removed. From January 1st 2009,
100% foreign invested educational
organizations are allowed to be
established and operate in Vietnam.
INTERNATIONAL ECONOMIC INTEGRATION
WTO
Vietnam actively participated in 7th ASEM
Summit in China, 24-25th October 2008 with several
initiatives, which were warmly welcomed by ASEM
members, including the initiative on cultural
coordination with a view to promote ASEM image, or
initiative on strenthening the exchange of experience
in preparedness for climate change and epidemic
disease.
Vietnam is closely coordinating with ASEF
Fund to prepare activities to be held on the sideline of
the 9th ASEAM Foreign Ministers’ Meeting in May
2009 in Hanoi.
Vietnam is also an active member in
APEC. In the 16th APEC Summit in Peru, 22-
23 November 2008, according to Vietnam
initiatives, the Summit agreed to reaffirm the
international commitments to increasing ODA
and assistance for developing countries in
response to global economic downturn.
An important landmark of ASEAN is to complete and adopt ASEAN Chapter which
will help the association co-operate more effectively and operate more dynamically. Viet-
nam actively took part in and significantly con-
tributed to drafting the ASEAN Charter, particu-
larly proposing goals, principles and key guide-
lines for the Chapter. Vietnam was one of the
first 5 members to ratify the Charter on 6th March
2008.
On 1st April 2008, on behalf of the Viet-
nam’s Government, Minister of Trade and Indus-
try, H.E. Mr. Vu Huy Hoang signed the ASEAN
– Japan Comprehensive Economic Partnership
INTERNATIONAL ECONOMIC INTEGRATION
Special Economic Bulletin 2009 - Page 15
ASEM
APEC
ASEAN
Page 16 - Special Economic Bulletin 2009
(AJCEP), which is an important agreement to strengthen close and comprehensive eco-
nomic cooperation between ASEAN and Japan, marking a significant milestone in the
ASEAN- Japan cooperation.
Joined with other ASEAN member, Vietnam has actively participated in negotiation
of the ASEAN – India Free Trade Area (FTA), which was scheduled to be signed in early
2009. Vietnam is also key member in FTA negotiations between ASEAN and Australia
and New Zealand.
Vietnam successfully hosted the
3rd ACMECS (Ayeyawadi – Chao
Phraya – Mekong Economic Cooperation
Strategy) Summit and the 4th CLMV
(Cambodia, Laos, Myanmar and
Vietnam) Summit from 3-7th November
2008 in Hanoi. The two Summits adopted
many important cooperation documents,
including the ACMECS Summit
Declaration; the ACMECS Leaders’
Declaration on Facilitation of Trade,
Investment and Tourism; signing the
CLMV Summit Joint Statement, etc...
and created a new impetus for further enhancing ACMECS and CLMV cooperation
frameworks more effectively and substantively.
Vietnam actively participated and contributed to the success of the 3rd GMS
(Greater Mekong Sub-region) Summit in March 2008, in Vientiane, Lao PDR, and the 5th
Cambodia – Laos – Vietnam (CLV) Summit in November 2008 in Vientiane, Lao PDR
with a view to strengthen the good neighborliness effective cooperation with sub-regional
countries for the sake of developing the Mekong sub-region into a region of connected
infrastructure, dynamic economic development, social harmony and environmental
sustainability.
After 2 years of negotiation, Vietnam and Japan signed
the Economic Partnership Agreement (EPA) in 25th December
2008. The signing of EPA is a political and economic event of
major significance to bilateral relations, marking the 35th anni-
versary of the two countries’ diplomatic ties. The EPA is also a
concrete step towards strategic partnership relationship between
Vietnam and Japan. This is the first economic partnership agree-
INTERNATIONAL ECONOMIC INTEGRATION
MEKONG SUB-REGION
SIGNIFICANT AGREEMENTS
ment that Vietnam signs with its major partners, marking a new milestone not only in the
Vietnam – Japan cooperation, but also in the international economic integration progress of
Vietnam. The EPA is a comprehensive agreement built in accordance with the World
Trade Organization’s (WTO) standards and rules, aiming to facilitate the trading of com-
modities, capital, technologies and skillful labour between the two countries.
Vietnam and EU kicked off the negotiation of Vietnam – EU Partnership Coopera-
tion Agreement (PCA) which is agreed to cover a wide range of areas and will outline a
common vision for the future. PCA is a comprehensive agreement on bilateral and multi-
lateral cooperation ranging from politics, economics, trade, investment, justice, culture,
education, science-technology, healthcare, agriculture, tourism, energy and traffic to envi-
ronment. It reaffirmed the traditional friendship and the historical, political and economic
relationship which attaches Vietnam and the EU. The negotiations of the PCA to replace
the 1995 framework agreement reflect Vietnam and the EU’s desire and determination to
build a stable and long-term cooperation framework, which permits both sides to bring
their relationship to a new height. The third round of the PCA talks will take place in Brus-
sels, Belgium in 2009.
INTERNATIONAL ECONOMIC INTEGRATION
Special Economic Bulletin 2009 - Page 17
Page 18 - Special Economic Bulletin 2009
VIETNAM’S INVESTMENT ENVIRONMENT UPDATE IN 2008
In 2008, FDI inflows into Vietnam reached a new record which is a practical evi-
dence for international investors' confidence in the long and medium term development
prospect of Vietnam. Beside the Government’s strong determination to sustain macroeco-
nomic stability, efforts to improve business environment also play an important role in in-
creasing FDI attraction.
In 2008, many businesses and donors expressed their positive view of the mid-term
development prospects of Vietnam and still positioned Vietnam as a lucrative FDI destina-
tion. More than 75% surveyed enterprises planned to expand their business in Vietnam in
next 3 years. However, businesses also cited inflation- triggered salary increase, lack of
skilled workforce, infrastructure bottlenecks, cumbersome administrative procedures and
regulations of labor strike are major obstacles and have yet to be improved in Vietnam’s
business environment.
In response to investors' demand and concern, Vietnam is trying its best to improve
business environment with a view to offer a more favorable one. In 2008, the efforts fo-
cused on: (i) sustaining macroeconomic stability; (ii) continuing to deal with bottlenecks in
-infrastructure, improving human resources and streamlining administrative procedures.
1. Sustain macroeconomic stability
In the context of the global economic downturn, macroeconomic stabilization is a
pre-requisite in investment environment in Vietnam. Given the priority focused on infla-
tion control, the Government has resolutely implemented a series of measures in an effort
to curb inflation, stabilize macroeconomic conditions, particularly the 8-point policy pack-
age focusing on monetary and fiscal tightening. Thanks to sound implementation of these
INVESTMENT ENVIRONMENT UPDATE
Factors for doing business in Vietnam (%)
Source: The Global Competitiveness Report 2008-2009 (WEF)
measures, inflation rate has been declining since June. Total credit growth in 2008 was be-
low 30%, the payment balance had surplus of 2.7 billions USD, FDI inflows into Vietnam
achieved a new high record in terms of both registered and disbursed capital, etc...
In effort to maintain the macroeconomic stability, the Government strengthened dia-
logue with business communities to share with their concern and timely and transparently
provide accurate information related to the socio-
economic situation, policies and measures of the Govern-
ment. The Government's efforts to stabilize the economy
have been actively supported by domestic and foreign
business communities. The public-private partnership,
therefore, have been strengthened closely to consolidate
the mutual confidence and consensus between the Gov-
ernment and business sectors to navigate through short
term challenges.
2. Improve the legal framework
In 2005, the National Assembly promulgated the Law on Investment which took
valid from July 2006, providing a single framework for both foreign and domestic invest-
ment. In addition, the Government issued a
series of guideline documents like Degree
No. 108/2006/ND-CP concretizing the
Law of Investment, Degree No.
78/2006ND-CP regulating outward invest-
ment, Degree No. 101/2006/ND-CP regu-
lating re-registration and transformation of
foreign invested companies, Degree No.
88/2006/ND-CP on business registration.
Besides, many legal documents related to
business environment have been already
issued such as, inter alia, Law on Land,
Commerce Law, Procurement Law, Law
on e-Transaction, Law on Intellectual Prop-
INVESTMENT ENVIRONMENT UPDATE
Special Economic Bulletin 2009 - Page 19
We commend the Government
of Vietnam for managing the
economy so well during this
challenging year.
Asian Development Bank
Nhon Trach Industrial Zone – Ho Chi Minh City
The Vietnam - Japan Joint Initiative to Improve Business Environment with a
view to strengthening Vietnam's competitiveness
The Vietnam – Japan Joint Initiative was started in April 2003 by the two Govern-
ments and has proved its effect. The Phase I was implemented from December 2003 to
November 2005 with 44 major items and 125 sub-items. Phase II was implemented from
July 2006 to December 2007 with 46 major items and 80 sub-items. In November 2008,
Vietnam and Japan agreed to start Phase III with the Action Plan including 7 major items
and 37 sub-items to continue improve the legal system and policies related to investment
environment in Vietnam. Focuses are:
(i) To improve regulations on decision-making process of Directors’ Boards of en-
Page 20 - Special Economic Bulletin 2009
terprises established before the Enterprise Law taking effective;
(ii) To enhance the capacity focal points governing foreign investment activities;
(iii) To develop public infrastructure for improving living of workers in industrial
zones;
(iv) To clarify and specify cost items in calculation of corporate income tax;
(v) To introduce transparent and fair application of VAT invoices;
(vi) To draft a master-plan to develop supporting industries;
(vii) To accelerate the development of electricity infrastructure, etc…
The Phase III Action Plan with less items and sub-items showed positive progress
in business environment since the number of components in business climate to be im-
proved has gradually reduced. This Action Plan is scheduled to be implemented within 2
years from November 2008 to November 2010.
As emphasized by Mr. Mitsuo Sakaba, Ambassador of Japan at Vietnam Consulta-
tive Group Meeting (Hanoi, 4-5 December 2008): “In view of the current international fi-
nancial and economic crisis, improving business environment of Vietnam is even more
critical to keep attracting foreign direct investments. In September 2008, Japan and Viet-
nam agreed in principle on the bilateral Economic Partnership Agreement, of which we
are working for early signing. Last month, our two countries also launched Phase Three of
the Vietnam – Japan Joint Initiative to improve Vietnam’s business environment…. The
outcome of this initiative is equally beneficial to other countries, and I hope that Vietnam
would be able to strengthen its international competitiveness through this exercise and be-
come the most favourable FDI destination in the world.”
INVESTMENT ENVIRONMENT UPDATE
3. Efforts to remove “bottlenecks” to the economic growth
In addition to resolute implementa-
tion of macroeconomic stabilization policy
package, Vietnam continued its efforts to
remove obstacles in investment and busi-
ness environment, particularly in infra-
structure, human resources and admini-
stration procedures.
Electricity: Given rapidly eco-
nomic development, energy demand in
Vietnam is on rise correspondingly. Elec-
tricity production by October 2008 was
estimated 62.125 billion kWh, up by
12.2% compared with the same period of
Construction site of Son La Hydroelectric plant
last year.
Road infrastructure: By the end of 2008, national road No.1 and other the major
highways to seaports and international border checkpoints, road links in the Southeast re-
gion and Mekong delta, etc… have been significantly improved. Phase I upgrade of major
seaports (Cai Lan, Hai Phong, Tien Sa, Quy Nhon, Nha Trang, Sai Gon, Can Tho, etc…)
has been completed. According to the International Telecommunication Union (ITU), Viet-
nam is one of the most rapid growth telecommunication markets in the world. By the end
of 2008, telephone line density reached 88.7 sets per 100 people; nearly 20 million internet
subscribers, accounting for 24,1% total population.
Workforce: In recent
years, labor demand in labor
intensive industries like tex-
tile, manufacture, assembly
and food processing has rap-
idly increased. This fact dem-
onstrated that Vietnam has
the potential to become a
manufacture and processing
base in the region and is ac-
tively integrating into the
“Asian value chain”. In addi-
tion, the increase in labor de-
mand in insurance and bank-
ing sectors is also a practical
evidence not only for rapid
development of financial sectors, but also for Vietnam’s great efforts to undertake WTO’s
commitments on market access in financial services.
However, the fact also shows that there is a lack of well- skilled workforce and high
- level managers in Vietnam. According to WB, the quality of human resource in Vietnam
just records 3.79 point on the scale of 10. From such a reality, human resource develop-
ment must be given with top priority. In 2008, Vietnam implemented a series of measures
to improve its labor forces: (i) Strengthening partnership between educational and training
institutions and businesses; (ii) Developing high-quality workforce training schemes in in-
formation technology, banking and finance, tourism and ship building; (iii) To set up inter-
national training centers invested by private sectors for training middle - level workers in
response to demand of foreign investors.
4. Accelerate public administration reform and anti-corruption
In 2008, the reform of administrative institutions continued to be reinforced in re-
sponse to requirements in exercising grass-root democracy, streamlining administrative
procedures and information publicity. Introduction of one - stop business registration is a
significant step in administration procedure reform. Business registration application is just
filed to provincial Department of Planning and Investment and business license will be
INVESTMENT ENVIRONMENT UPDATE
Special Economic Bulletin 2009 - Page 21
Job trends created in FDI enterprises (unit: job quantity)
Source: Vietnam business annual report 2007
Food
Tourism
Textile
Banking
Construction
Insurance
Page 22 - Special Economic Bulletin 2009
granted after 5 working days. Information technology has been applied in public admini-
stration such as Government’s online meetings, information ports for exploration of admin-
istrative procedures, etc… Those efforts helped improve responsibility and accountability
of administrative agencies for better public services.
In 2008, a series of legal docu-
ments on anti- corruption were promul-
gated1. The “Integrating anti- corruption
into educational programs” Scheme and
the National Strategy for Anti- corrup-
tion towards 2020 have been estab-
lished. Besides, various anti- corruption
have been enforced over the last years
such as: (i) To make activities of the
governmental agencies transparent; (ii)
To develop and introduce norms and
standards in management and utilization
of public assets, public land and finance;
(iii) To make properties and income
transparent; (v) To remit salary of civil
servants through bank accounts; (vi) To
apply rules and norms on professional
morality in some sectors.
To further improve business in upcoming
years, the following measures will be imple-
mented:
- Accelerate the progress in planning and
revise out-of-date plans; improve the legal frame-
work for planning in order to facilitate site clear-
ance for investment projects.
- Revise or remove investment incentives,
which are not conformity with WTO’s commit-
ments, but legitimate interests of relevant investors must be ensured. Issue legal documents
to provide guidelines for the implementation of laws related to business and investment
activities.
- Make overall review and revision of infrastructure planning towards 2020 in order
to facilitate FDI investment in infrastructure development. Introduce incentives for private
sectors investing in infrastructure projects, particularly those in transport, seaports and
electricity. Encourage FDI investment in key projects in telecommunication and informa-
INVESTMENT ENVIRONMENT UPDATE
“… The Government of Vietnam is
committed to effectively implement the
public administration reform and step-
up the fight against-corruption in order
to continue creating favorable business
and investment environment.” Opening remarks by Prime Minister
Nguyen Tan Dzung at the 16th Consultative
Group Meeting (Hanoi, 4 December 2008)
1 Decree No. 65/2008/ND-CP dated May 20th 2008 on functions, tasks, authority and organizational structure of the Government
Inspectorate; Decree No. 91/2008/ND-CP dated August 18th 2008 promulgating the Regulation on publicity of audit results and
results of implementation of the State Audit’s conclusions and recommendations; Decision No. 115/2008/QD-TTg by Prime Minis-
ter dated 27 Aug 2008 issuing Regulations on management and use of public assets in governmental authorities, semi-public insti-
tutions and other organizations authorized to manage and use public assets.
Dialogue on anti-corruption between the Government of Viet-
nam and donor community in 2008
Special Economic Bulletin 2009 - Page 23
tion technology.
- Effectively implement the decentralization of FDI management and enhance the
capacity of public agencies and officials to satisfy requirements by Law on Investment.
Simplify administrative procedures in FDI management, introduce single-window proce-
dure and timely deal with the issues related to investment licenses.
- Accelerate the implementation of the Plan for education and training; further in-
vest in the development of vocational training schools; revise the Labor Code to prevent
illegal labor strikes and harmonize benefit between employers and employees.
INVESTMENT ENVIRONMENT UPDATE
Page 24 - Special Economic Bulletin 2009
ODA MOBILIZATION AND UTILIZATION IN VIETNAM
1. Reviewing 15 years of development cooperation between Vietnam and the
international donor community
The year 2008 celebrates the 15th anniversary of development cooperation between
Vietnam and international donors since the first Consultative Group Meeting for Vietnam
(CG Meeting) in Paris (France) in November 1993. Reviewing the mobilization and
utilization of ODA over the past 15 years, one could see that ODA has played an important
role in Vietnam’s development process, contributing to its socio- economic development
and poverty reduction and deepening its partnership with the international donor
community. CG Meetings have become interactive fora where government and donor
community meet and have dialogue on Vietnam’s socio- economic development strategies,
plans and policies.
The international donor community has increasingly expanded and there have so far
been 51 donors for Vietnam, including 28 bilateral donors and 23 multilateral donors,
including both OECD-DAC and non-OECD members. Most donors have established their
long and medium term strategies on development cooperation with Vietnam. Many donors
like ADB, Japan, EU, Australia, etc… have already included Vietnam into their lists of
prioritized recipients.
Over the past 15 years, Vietnam has
always been accorded with strong support
by the international donor community. The
total committed ODA has reached around
47.5 billion USD, of which, a record 5.4
billion USD was committed at the 2007
CG Meeting. Despite the current downturn
of the world economy due to the global
financial crisis, donors reaffirm their
strong support for Vietnam's development
by committing a large amount of 5.014
billion USD for Vietnam at the 2008 CG
meeting from 4-5 December 2008. So far,
Vietnam and donors have signed ODA
agreements worth 35.217 billion USD (as
of October 2008), accounting for 82.98%
of total ODA volume, of which 22.065
billion USD has been realized equivalent to 52% of total committed ODA.
Based on the socio-economic development strategies of Vietnam and close
consultation with donors, ODA in Vietnam has been primarily targeted to the development
of pivotal socio-economic infrastructure such as energy, transport networks, agriculture
and rural development, education and training, health care, and environment protection.
Although ODA accounts for merely 3-4% of total GDP, it has been an important source of
capital for infrastructure development and served as a ”catalyst” for mobilization of other
ODA MOBILIZATION AND UTILIZATION
3.74
4.45
5.43
5.014
0
1
2
3
4
5
6
2006 2007 2008 2009
Committed ODA in recent years (billion USD)
capital resources like FDI, private
investment, etc. ODA implementation in
Vietnam has been effective and made
positive contribution to the improvement of
production capacity and competitiveness of
the Vietnam economy.
Transport and telecommunication
sectors has received the largest share of
ODA with 9.88 billion USD focusing on
improvement and development of road
networks, railways, air transport, seaports,
etc... ODA-funded transport works like
National Road No. 5, Road from Ho Chi
Minh City to Moc Bai, Hai Van Tunnel,
Tien Sa deep seaport, Bai Chay bridge, My
Thuan Bridge, Tan Son Nhat airport, etc.. have produced spillover effects and made
important contribution to the development of Vietnam. The energy sector also received a
large portion of ODA with 6 billion USD to upgrade and develop large-scale power plants
such as Phu My 2.1 thermal power plant (280 MW), Pha Lai II power plant (600 MW),
Ham Thuan- Da Mi hydro-power plant (475 MW), O Mon thermal power plant (600 MW),
Phu My I plant (1.090 MW), etc.
Agriculture development and poverty reduction are also given priority in ODA
utilization and have so far received 5.5 billion USD. Many large-scale projects and
programs funded by ODA such as Population and Development Program, Rural Clean
Water Program, Rural Transport Program, Rural Electrification Program, Mekong Delta
Irrigation Program, etc… have contributed greatly to the development of agricultural and
rural infrastructure and improvement of living standards of rural, mountainous and ethnic
minority people. Poverty rate by the national standards in Vietnam declined rapidly from
ODA MOBILIZATION AND UTILIZATION
Special Economic Bulletin 2009 - Page 25
Hai Van Tunnel - an effective project by Japan ODA
11%
22%
43%
24%
Agriculture, Irrigation,
Forestry, Aquaculture and
Agriculture and Rural
Development, Hunger
Elimination and Poverty
ReductionEnergy and Industry
Traffic, Telecommunications,
Urban water supply and
drainage
Heath, Education and
Training, Environment, Others
ODA structure signed by sector and field (from 2006 to 30 October 2008)
Page 26 - Special Economic Bulletin 2009
58.1% in 1993 to 15.5% in 2007. With its great success in
poverty reduction, Vietnam became one of the first countries
that fulfill the millennium development goals (MDGs) in
terms of poverty reduction and, therefore, was praised by the
UN as an example in translating high economic growth into
poverty reduction and social progress.
Health care, education and training and environment
protection are also significantly funded by ODA with the
total committed amount of 4.3 billion USD. ODA projects
have contributed to education reform, capacity building in
education management and training of tens of thousands of
Vietnamese students in different sectors. Most ODA in health care was in the form of grant
aid and focused on the improvement of health care facilities, development of hospitals at
different level, and prevention of HIV/ AIDS and epidemics, etc… Environmental protec-
tion and sustainable development have been actively supported by donors through various
programs and projects in the field of forestation, development of natural protection areas,
national parks, environmental sanitation, etc.
2. Effective utilization of ODA
Enhancing ODA effectiveness is a crucial factor and
a pre-requisite in the ODA mobilization and utilization pol-
icy of Vietnam in order to avoid foreign debt insolvency.
Vietnam has been widely recognized by the international
financial institutions (IMF, WB, ADB, etc…) to have a safe
level of foreign debt. Donors share the view that Vietnam is
a “spotlight” in terms of effective utilization of ODA. Aid
effectiveness in Vietnam has been demonstrated by its sig-
nificant contribution to the development of Vietnam. WB,
Japan and other donors recognize that their ODA- funded
projects have achieved their pre-set objectives and develop-
ment outcomes. Followings are reasons to explain the effec-
tive use of ODA in Vietnam.
First, according to the Development Aid Committee (DAC/ OECD), by the end of
2007, Vietnam ranked ninth out of 10 biggest ODA recipient countries in the world. More-
over, Vietnam is also in the top-ten ODA recipient list of nearly half of DAC members.
History proves that ODA usually flows to developing countries with high political stabil-
ity, impressive economic growth, and rapidly improved living standards of people, particu-
larly the poor. Vietnam is such an example.
Second, Vietnam is one of few pioneering countries in enhancing aid effectiveness.
The Government of Vietnam ratified the Paris Declaration on Aid Effectiveness and subse-
quently translated this Declaration into the Hanoi Core Statement on Aid Effectiveness in
line with the development conditions of Vietnam. Immediately after the Accra Action
Agenda (AAA) was approved internationally, Vietnam ratified and enforced this Agenda
ODA MOBILIZATION AND UTILIZATION
“The Asian Development Bank
(ADB) joins other development
partners in congratulating the
Government for its active partici-
pation and contribution to the
formulation of the Accra Agenda
for Action (AAA) at the Third
High-Level Forum on Aid Effec-
tiveness in September 2008 in
Ghana.” Statement by ADB representative at
CG Meeting 2008
Special Economic Bulletin 2009 - Page 27
with various activities including knowledge building and formulation of joint work plans
with relevant donors, etc.
Third, ODA utilization in Vietnam has been mainly targeted to support the realiza-
tion of development goals such as poverty reduction, infrastructure development, education
and training, health care, development of remote, mountainous and ethnic minority areas,
and improvement of the legal system in line with Vietnam’s economic development and
international integration, etc.
3. ODA remains an important complementary resource in upcoming time
Despite its significant socio-
economic achievements after 20 years of
the Renovation (Doi Moi), Vietnam re-
mains a low-income developing country.
Poverty rate has fallen rapidly but is still
high at 13% by the end of 2008. The chal-
lenge of poverty reduction sustainability
remains since most households escaping
from poverty now live in rural, mountain-
ous and ethnic minority areas with income
of just 5-10% above the poverty line.
Vietnam’s infrastructure system is under-
developed in comparison with other re-
gional countries. Human resources are
abundant but lack skilled workforce. Do-
nors and foreign investors viewed the
weaknesses in infrastructure and workforce as “bottle-necks” that Vietnam need to over-
come to sustain high growth momentum in the upcoming years. The global financial crisis
and economic recession could hamper the economic growth of Vietnam, particularly
through adverse impacts on vulnerably poor people. Besides, Vietnam is also faced with
increasing challenges like climate change, natural disasters, epidemics, environmental pol-
lution, etc.
In the upcoming stage of development, Vietnam will continue to accelerate eco-
nomic reforms and international integration and mobilize and effectively use different capi-
tal sources, of which ODA plays an important role. ODA utilization shall be focused on the
followings:
- ODA shall be continually pri-
oritized for large-scale infrastructure
projects or programs that could pro-
duce spillover effects to support cross-
sector and inter-regional development
such as power plants, express ways,
urban transport infrastructure, sea-
ports, airports, hi-tech projects, etc.
- The utilization of ODA, par-
ODA MOBILIZATION AND UTILIZATION
“Development of infrastructure remains to be ma-
jor priority for Vietnam. Japan has been working
with Vietnam for its infrastructure build-up, in-
cluding the three major projects requested to the
Japanese Government by Prime Minister Nguyen
Tan Dzung, namely, North-South Speed railway,
North-South Highway, and Hoa Lac High-tech
Park.” Statement by Mr.Mitsuo Sakaba, Ambassador of Japan to Viet-
nam, Consultative Group Meeting 2008
Infrastructure - a bottleneck of Vietnam economy
Page 28 - Special Economic Bulletin 2009
ticularly less preferential ODA loans, shall be priori-
tized for programs and/or projects with high profits
after 2010;
- To facilitate the access to ODA, including
access for the private sector through the development
of public- private partnership.
To further enhance the effective use and speed up the disbursement of ODA in com-
ing years, Vietnam will continue: (i) to reform administrative procedures in ODA manage-
ment and fight against corruption; (ii) to harmonize Vietnam’s regulations with donors’
procedures; (iii) to accelerate the implementation of the Paris Declaration and Hanoi Core
Statement on Aid Effectiveness and the Accra Action Agenda (AAA); (iv) to strengthen
the monitor and close supervision of the allocation, utilization and evaluation of ODA; (v)
to strengthen capacity- building for agencies and staff at all levels in ODA management.
ODA MOBILIZATION AND UTILIZATION
Mr Ayumi Konishi, Country Director,
Asian Development Bank (ADB):
“ADB advances together with Vietnam
toward the future”
FOSTERING COMMUNICATION BETWEEN THE GOVERNMENT
AND BUSINESS CIRCLES
Since early 2008, due to the adverse impacts by the global economic downturn, the
Vietnam’s economy faced with a lot of difficulties and caught much of attention from in-
ternational business circles, particularly on the Government’s policy response. Several pes-
simistic opinions even supposed that Vietnam fell into a “crisis”. Government’s policy pri-
ority to curb inflation was widely welcomed and created confidence in the medium and
long-term development outlook on Vietnam economy. However, concern was raised on
whether the anti-inflation measures would be effectively, consistently and resolutely car-
ried out. Most international institutions and investors stressed a need to strengthen the con-
fidence of business circles on concrete actions besides strong commitment and determina-
tion. According to WB Acting Country Director in Hanoi, only good policy itself was not
enough to alter the mood of business communities but good communication was equally
important.
Source: Report: “Assessment of Vietnam’s economy and prospects for 2008-2009” , World Bank, 9/2008
The two above charts clearly show that in early 2008, the Government had introduced a series of
measures to curb inflation and stablize macroeconomy. However, it is apprarent that those measures
started to take effect in the second half of the year after a wide range of communication between the
Government and business circles such as the Mid-term Consultative Group (CG) Meeting(early June
2008), the video conference with investors (lately June 2008) and other dialogues.
Given uncharted moves of the global and domestic economic environments, to pre-
vent speculative activities and inaccurate information related to the Vietnam’s economy,
the Government strengthened communication and dialogue with international and domestic
business circles, donors, economic researchers in order to release transparently economic
COMMUNICATION BETWEEN THE GOVERNMENT AND BUSINESS
Special Economic Bulletin 2009 - Page 29
12,000
14,000
16,000
18,000
20,000
22,000
24,000
26,000
28,000
30,000
2-Ja
n-08
1-Feb
-08
4-Mar-08
3-Apr-08
5-May
-08
4-Ju
n-08
4-Ju
l-08
5-Aug
-08
5-Sep
-08
29-S
ep-08
ND
F -
VN
D p
er $
, 12 m
onth
s forw
ard
100
150
200
250
300
350
400
CD
S, countr
y r
isk p
rem
ium
in b
asis
poin
ts
NDF - 12 M CDS - 5 YR
Credit
tightening
begins
8-po int
package
anno unced
bas ic inte res t ra te
ra is ed to 14%bas ic inte res t
ra te ra is ed to 12%
12,000
14,000
16,000
18,000
20,000
22,000
24,000
26,000
28,000
30,000
2-Ja
n-08
1-Feb
-08
4-Mar-08
3-Apr-08
5-May
-08
4-Ju
n-08
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l-08
5-Aug
-08
5-Sep
-08
29-S
ep-08
ND
F -
VN
D p
er $
, 12 m
onth
s forw
ard
100
150
200
250
300
350
400
CD
S, countr
y r
isk p
rem
ium
in b
asis
poin
ts
NDF - 12 M CDS - 5 YR
Video -co nference
with inves to rs
Mid-te rm CG
meeting
Good policy is not enough … Communication matters
Page 30 - Special Economic Bulletin 2009
information. These efforts were closely sup-
ported by business and donor communities
and increasingly consolidated their confi-
dence.
The year 2008 began with the
“Business Roundtable with the Government of
Vietnam” entitled "Vietnam - A Rising Star in
Asia", co-organized by the Ministry of For-
eign Affairs and the Economist Conferences
(8-9th January 2008 in Hanoi), which gathered
around 120 leading groups like GE, Canon,
BP, Coca-Cola, Posco, Boeing, Shell, SCG,
Nokia, AIG, Indochina Capital, Motorola,
Toyota, SK Telecom, Dragon Capital…
Prime Ministers, Ministers and other high-
level officials of Vietnam attended this Con-
ference. The conference was a platform for
foreign businesses to directly interact with the
Government on their concerns about the Viet-
nam’s economy. As said by Mr. Dominic
Scriven, Managing Director of Dragon Capi-
tal, business circles were offered a unique op-
portunity to explore the Government’s devel-
opment directions and shared their views with
the Government for mutual benefit.
The Government’s communication ef-
forts continued at different international fora,
such as, inter alia, the 18th Asia Society con-
ference (Tian Jin, China, May 2008), the
“Future of Asia” Conference (Japan, May
2008), the World Economic Forum (WEF)
Conference on East Asia (Kuala Lumpur, Ma-
laysia, June 2008), etc… At these confer-
ences, Vietnam leaders had exclusive interac-
tion sessions with international business cir-
cles by updating Vietnam’s economic situa-
tion and affirming the Government’s commit-
ment to curb inflation and ensure macroeco-
nomic stability in hand with acceleration of
reform and international integration.
It is noteworthy that an online video conference was organized for the first time on
19th June between Financial Minister and Leaders of relevant Ministries and domestic and
foreign businesses. Frank dialogue and interaction were prevailed during this conference.
Official information on Vietnam’s economic situation, particularly on financial and bank-
COMMUNICATION BETWEEN THE GOVERNMENT AND BUSINESS
Government – Business Dialogue
in 2008
January: Business Roundtable with
the Government of Vietnam entitled
"Vietnam - A Rising Star in Asia"
May: Asia 18th Asia Society in Tian
Jin, China; “Future of Asia” Confer-
ence in Japan
June: Online video conference be-
tween Government of Vietnam and
international and domestic investors
July: “Vietnam Leaders in Develop-
ment Program”.
September: Dialogue between the
Government’s Standing Committee
and domestic and foreign experts
and businesses.
December: Vietnam Business Fo-
rum.
ing sector, and Government’s policy response was updated and widely discussed. For the
first time, the Governor of the State Bank of Vietnam (SBV) announced Vietnam’s foreign
exchange reserve of 20.7 billion USD and reaffirmed that “Vietnam has no policy to de-
valuate the Vietnamese dong currency”. The practice to enhance information transparency
and publicity significantly strengthened market confidence.
As an annual practice, Vietnam Business Fo-
rum was held in early December 2008 on the occasion
of the Donor Consultative Group Meeting for Viet-
nam. In the Forum, practical proposals by domestic
and international business circles, particularly recom-
mendations on business environment improvement in
all sectors such as capital market, infrastructure, distri-
bution services, land, human resources, etc… were
submitted to the Government. Despite prevailing con-
cern on short-term challenging, business communities
showed strong confidence in the favorable medium-
term outlook of the Vietnam's economy and believed
that Vietnam can navigate successfully through whirl-
wind sea.
Not only dialogue, the Government has also increased close consultation with inter-
national institutions (WB, IMF, ADB, UNDP, etc…) and researchers, who are experienced
of Vietnam, and seriously considered their valuable and practical recommendations in
macroeconomic policies making process. To name the first was the seminar co-organized
by Ministry of Foreign Affairs, Harvard University and BP in July for in-depth interaction
between the Government’s policy makers and domestic and foreign senior experts on short
-term macroeconomic stabilization as well as long term development directions in Viet-
nam. Secondly, a dialogue between members of Government’s Standing Committee, do-
mestic and foreign researchers and experts was hold in late September to exchange views
on macroeconomic situation in Vietnam. And last but not least, the Professor Michael Por-
ter’s visit to Vietnam had been deeply cultivated by series of talks with Vietnam’s policy
makers, business circles on direction for developing Vietnam competitiveness policy in its
new stage of development.
Consolidated confidence
Press Release of the Mid-term Consultative Group Meeting (June, 2008) stated that
“Vietnam’s long term prospects remain strong, despite domestic and international macro-
economic turbulence”. VinchiCapital investment fund said, “Vietnam’s fundamentals re-
main strong”. The Special Report “Vietnam: a cyclical crisis in a structural uptrend” by
BCA Research (United Kingdom) noted that Vietnam’s long-term growth prospects
“remain better than in many other emerging economies” and all emerging economies have
undergone similar difficulties, etc... It is clear that the efforts by the Government to
strengthen communication and information transparency not only effectively support its
stabilization policy package but also significantly consolidate confidence of domestic and
international business circles. Despite short- term economic difficulties, the year 2008 wit-
COMMUNICATION BETWEEN THE GOVERNMENT AND BUSINESS
Special Economic Bulletin 2009 - Page 31
Vietnam Business Forum 2008
Page 32 - Special Economic Bulletin 2009
nessed many delegations of world- class corporations to visit Vietnam for exploring invest-
ment opportunities such as the delegation of ASEAN- US Business Council (March, 2008),
CEOs of World Economic Forum (June, 2008), hundreds of business accompanying for-
eign state leaders visiting Vietnam, etc. As a result, the optimism and expectation by inter-
national investors has been translated into a record FDI flow with nearly 64 billion USD
into Vietnam during 2008.
COMMUNICATION BETWEEN THE GOVERNMENT AND BUSINESS
“Foreign investors’ confidence in Vietnam has been underlined throughout 2008, with
strong portfolio investment inflows and FDI hitting record levels with disbursed fund-
ing of close to US$ 10 billion. Inflation has shown significant declines in recent
months, underlining the successful fiscal and monetary policy imposed in the second
quarter of the year. The trade deficit has slowed its growth and foreign currency re-
serves are strong, all encouraging factors in terms of Vietnam’s ability to maintain
both growth and stability in the face of significant concerns elsewhere in the world”.
Mr Alain Cany – Chairman of EuroCham presented at Vietnam Business Forum 2008
WHAT THE WORLD SAYS ABOUT VIETNAM
SAY ABOUT VIETNAM
Special Economic Bulletin 2009 - Page 33
“Congratulated the Government of Vietnam for overcoming
the various economic challenges of 2008. 2009 will bring
about new and more difficult challenges. But the meeting
clearly concluded that Government will be sustaining its
efforts at economic and social reforms and that as a result,
Vietnam can count on the donor community for continued
support.” Mr. James Adams, Vice
President of the World
Bank in East Asia and
Pacific
“The global economic downturn would hit Vietnam but at
slower pace than other economies. Vietnam needs to take
flexible and quick responses to possible impacts. Vietnam is
perceived as reacting well to the crisis with its impressive
performance this year, demonstrating the resilience of its
economy.”
Mr. Martin Rama, World
Bank Acting Country
Director
“Congratulated the Vietnamese Government for effectively man-
aged macro economic difficulties this year. But given the global
economic downturn, 2009 will not be easier. We hope the Govern-
ment will closely monitor the situation, and carefully analyze and
balance various risks. We are particularly concerned about the pos-
sible adverse impacts on the poor, small and medium enterprises
and the vulnerable people. Together with other development part-
ners, we would like to provide strong support to the Government
in responding to the emerging situation. We will stand ready to do
whatever we can to help Vietnam maintain critical development
expenditures.”
Mr. Ayumi Konishi,
Country Director of the
Asian Development
Bank in Vietnam
“Vietnam continues to be a shining light internationally because of its commitment to us-
ing aid well. The question is how can Vietnam make real changes in aid delivery practices
at the sectoral and sub-national levels. There are some promising developments, but more
has to be done to address the challenges, such as capacity constraints at local levels, im-
proving the consistency in the country systems across ministries, and enabling the civil so-
ciety to maximize its potential to contribute to Vietnam’s development.” Mr. Allaster Cox, Ambassador of Australia to Vietnam
Page 34 - Special Economic Bulletin 2009
SAY ABOUT VIETNAM
“2008 has been a year of
dramatic challenges in
the world economy, and
for Vietnam, with macro-
economic turbulence,
high inflation and large
trade and current account
deficits. We commend
your Government’s
largely successful meas-
ures to stabilize the situa-
tion and preserve the
confidence of economic
operators, in consultation with the IMF and oth-
ers. 2009 will also be a challenging year. The
encouraging results shown in recent months by
declining inflation & trade deficit should of
course not lead the Government to reduce its
vigilance … We particularly interested in the
Government’s continued commitment to struc-
tural economic reform… and how it may en-
courage small and medium enterprises, which
are the most productive and promising con-
tributors to Vietnam’s economy.”
“Despite the eco-
nomic turbulence
of this year and a
dif f icul t year
ahead, the medium
term outlook for
Vietnam remains
favorable, pro-
vided that the gov-
ernment sustains
the momentum of
economic reforms
that have brought
so much success
this decade. The
government needs
to be cautious in setting objectives for
2009, especially for growth and in-
vestment. It is also equally important
to design appropriate economic poli-
cies that balance the growth and ex-
ternal risks confronting Vietnam,
safeguard institutions, improve data
quality and communication, and ac-
celerate structural reforms."
Mr. Hervé Bolot, Ambas-
sador of France to Viet-
nam
Mr. Shogo Ishii,
Assistant director
of the Interna-
tional Monetary
Fund Asia and
Pacific Depart-
ment.
While Vietnam has experienced impressive growth over the last
two decades, its reforms have been insufficient to move the
country to a middle income economy. To truly improve its
standard of living, the country must adopt a long-term eco-
nomic strategy. Vietnam boasted a host of competitive advan-
tages, such as political stability, the increased decentralization
of economic policymaking responsibilities, and an acceptable
level of debt. However, Vietnam’s lack of openness would re-
tard further competitive upgrading.
Professor Michael Porter, Harvard Business School
SAY ABOUT VIETNAM
Special Economic Bulletin 2009 - Page 35
“Recent months have seen truly extraordinary events both in
Vietnam and around the world as the global financial crisis has
shaken both developed and developing economies to their core.
While Vietnam has not emerged entirely unscathed, the nation’s
relatively low levels of exposure to the global financial
markets, along with the policies put in place following
Vietnam’s own crisis earlier this year, mean the effects of the
global downturn are likely to be less severe here than
elsewhere.
Eurocham and its members have a firm belief in a great
potential of Vietnam, both as a regional leader and as
destination European investment and we are happy to contribute in any way we can
to help the nation consolidate an build on its successes.”
Mr. Alain Cany,
Chairman Eurocham
“Amcham applauds the Government for the substantial changes that have taken
place to comply with the requirements of participating in the World Trade
Organization. We appreciate the Government’s willingness to listen to our
concerns and take action in many areas.
Although Vietnam is facing some tough economic challenges, the country
remains an attractive destination for American investment. AmCham will
continue to work hard to increase the understanding among U.S. companies
about the growing opportunities to do business here, and we remain committed
to working with our partners in Vietnam to improve the business environment.”
Mr. Michael J. Pease, Chairman Amcham
Page 36 - Special Economic Bulletin 2009
VIETNAM’S EXPORT DIRECTION IN 2009
Export value in 2009 is targeted to reach
about 72 billion USD, an increase of 13% year-on
-year. To reach the above-set target, the following
will be implemented:
- Implement comprehensive measures to
improve the quality of commodities and products
quantity of which is difficult to increase (e.g. over
-dependent on weather, land, etc…), particularly
agro-products.
- Increase investment in expanding pro-
duction scale, technology and equipment renova-
tion to boost up production and export of prod-
ucts, that could significantly contribute to export
turnover and job creation, such as textile, foot-
wears, wood furniture, plastic products, cable,
etc…
- Enhance trade promotion and expand markets for potential and local- material in-
tensive products such as handicrafts, rubber products, processed food, cosmetic and chem-
istry productions, mechanical devices, software services, etc.
- Make full use of traditional and key export markets, at the same time develop mar-
kets in neighbour countries.
- Take full advantage of free trade agreements; attach export markets to import mar-
kets in order to increase export and reduce trade deficit, particularly deficit with partners
having large surplus with Vietnam.
As for export markets: Given worse economic condition in the US and Europe,
export to these markets is much unlikely to grow rapidly. As a result, it is a need to
strengthen market multi-lateralization and diversification, continue increasing export to
key and traditional markets in Asia (Japan, ASEAN, China, Korea, Taiwan, Hong Kong),
Europe (mostly EU and Russia), North America (the US, Canada), and actively penetrate
to potential markets such as Africa, South West Asia, Middle East, Latin America, Austra-
lia, etc…
ANNEX
Mr Vu Huy Hoang, Minister of Industry and
Trade: “In 2009, the exports is aimed to ex-
pand 13% compared to 2008. This is impos-
sible task unless there are concerted efforts
of all relevant Ministries and enterprises.”
Special Economic Bulletin 2009 - Page 37
SOME MEASURES TO PROMOTE TOURISM DEVELOPMENT
IN VIETNAM IN 2009
Under the negative impacts of the global financial crisis and economic downturn,
the recovery of the tourism industry will take time. To regain growth momentum and
achievethe target of receiving 4.5 million international arrivals, Vietnam focuses on
strengthening promotion and marketing activities, enhancing quality and reducing costs:
1. Develop programs to attract visitors in early 2009:
- Exploiting sea tourism.
- Developing new products for Lunar New
Year season, particularly the launching of promo-
tion campaign “Impressive Vietnam”.
- Travel companies shall co-ordinate with
Vietnam Airlines to develop unique products
with price incentives.
- Reducing cost of tours, accommodation
and other service charges.
- Promoting the establishment of tourism associations.
- Supporting tour operators to attend international and regional tourism exhibitions
such as reducing marketing cost, joint booths, etc...
- Vietnam Airlines, in collaboration with Vietnam National Administration of Tour-
ism, deploys the Visit JATA World 2008 to open new air links to attract foreign visitors to
Vietnam.
- Strengthening the close linkages among
tour operators, hotels and airlines to develop
special tour programs in the first quater of 2009.
2. Increase investment in products and
services.
- Investing in improvement of product
quality, services and tourism infrastructure.
- Promulgating legal documents on provid-
ing guidelines for the implementation of the
Tourism Law.
- Providing specific guidelines in tourism
expertise and planning.
ANNEX
Hạ Long Bay
- Strengthening tourism workforce
training, especially skilled service staff,
tour guides, etc...
- Encouraging tour operators and
hotels to cooperate with the Vietnam Na-
tional Administration of Tourism and
Travel Association to develop new prod-
ucts.
3. Enhance the coordination in tour-
ism
- Strengthen close coordination
among relevant agencies, particularly in
investment and development of integrated
tourism products. Establish a cross-sector
working group, including culture, sports, tourism and aviation to implement joint business
plans.
- Support enterprises through investment incentives, tax incentives, non-
discriminatory rates of electricity and water services, etc...
4. Strengthen marketing and promotion
- Design promotion plans for the period 2009 - 2010 and by the year of 2015.
- Make full use of effectively promotional activities (farm trips, Vietnam’s culture
days, MICE...).
- Enhance close coordination with Vietnam Airlines, Ministry of Foreign Affairs to
strengthen tourism promotion abroad.
- Enhance the role of tourism associations and closely coordinate with local authori-
ties to ensure promotion effectiveness.
- Open new markets and nurture traditional markets.
ANNEX
Page 38 - Special Economic Bulletin 2009
Sa Pa
VIETNAM’S ENERGY DEVELOPMENT STRATEGY
TOWARDS 2020 AND 2050
1. Goals and targets:
1.1. Goals: To ensure national energy security, provide enough energy for the socio
– economic development; to effectively exploit and utilize domestic energy resources; to
diversify energy investment and business models, develop healthily competitive energy
market; to accelerate the development of new and renewable energy, bio-fuel and nuclear
energy to satisfy the need of the socio - economic development; to develop energy indus-
tries rapidly, effectively and sustainably in hand with environment protection
1.2. Specific targets
- Primary energy supply is expected to reach 47.5 – 49.5 million TOE, 100 – 110
million TOE, 110 – 120 million TOE and 310 – 320 million TOE by the years of 2010,
2020, 2025 and 2050 respectively.
- Strengthen cooperation with other countries in seeking, exploring and exploiting
coal, oil, gas and other energies abroad to supplement domestic shortage.
- Develop power sources and grid, ensure electricity supply for the socio – eco-
nomic development and electricity supply reliability up to 99.7% by the year 2010.
- Develop oil refinery plants to satisfy domestic demand for oil derivatives; and in-
crease oil refinery capacity to 25 - 30 million tons by 2020.
- Increase the share of new and renewable energy to 3% of total commercial pri-
mary energy in 2010; 5% in 2020 and 11% in 2050.
- Increase the percentage of households using commercial energy for cooking to
50% in 2010 and 80% in 2020. Electricity shall reach 95% of households in rural areas in
2010 and all households in 2020.
- Develop long-term environment standards appropriate with regional and interna-
tional standards and the country’s development conditions. Control and reduce pollution in
energy sectors and all energy projects must satisfy environment standards by 2015.
- Introduce market mechanism in electricity, coal, oil and gas sectors. Establish
coal, oil and gas business markets from now to 2015 and electricity retail markets after
2020.
- Actively prepare necessary conditions for putting the first nuclear power plant into
operation by 2020, and then increase the share of nuclear power in the national energy
structure. Nuclear power is targeted to occupy 15 – 20% of total commercial energy con-
sumption by 2050.
ANNEX
Special Economic Bulletin 2009 - Page 39
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- Strengthening energy international cooperation. It is expected that in 2010 – 2015,
regional electricity grid will be created and in 2015 – 2020 regional natural gas system will
be constructed.
2. Major directions for energy development :
2.1.Electricity
- Ensure electricity supply for the
country’s development. Priority is given to
appropriate development of hydro power,
coal and natural gas-based thermal power.
Encourage the development of power plants
using renewable energy.
- Develop electricity industry in the
direction of diversified ownership. An-
nounce the list of public investment pro-
jects, encourage all economic sectors to
participate in electricity production and dis-
tribution.
- Diversify the modes of investment
in power production and distribution.
- Continue pilot equitization and
gradually expand the equitization of power
plants and electricity distribution enterprises.
- Establish and develop Vietnam’s electricity markets.
- Accelerate the research and development of nuclear power plants.
- Ensure sustainable development and minimize negative impacts on the environ-
ment.
2.2. Coal:
- Strengthen the exploration and evaluation of coal reserves in Quang Ninh coal
mine.
- Mobilize capital resources for the exploration, evaluation and feasibility study of
coal reserves in other areas.
- Develop coal industry on the sustainable basis to serve the socio- economic devel-
opment and ecological environment protection.
ANNEX
Na hang Hydroelectric plant
- Encourage different economic sectors to invest in coal exploitation, production
and distribution. Formulate a roadmap for the equitization of coal enterprises and develop-
ment of coal markets.
2.3. Oil and Gas
- Formulate and improve the legal
framework for oil and gas industries, par-
ticularly licensing for gas transport and dis-
tribution, gas pricing, gas distribution fees,
technical standards, etc...
- Encourage and enhance the oil and
gas exploration. Development a transparent
and effective mechanism for supervision of
contract implementation, periodical revision
and amendment of oil and gas contracts,
etc…
- Encourage investors to explore and
exploit natural gas mines. Diversify the
modes of investment and encourage the es-
tablishment of joint-venture to develop gas
power plants.
- Encourage foreign investors to apply high technologies in the exploration and ex-
ploitation of oil and gas mines, to establish joint ventures to build oil refinery plants and
distribute oil derivatives with appropriate market shares. Encourage oil derivatives dis-
tributors to participate in joint ventures to develop oil refinery plants in order to enhance
the production- consumption linkages and profit harmonization between production and
distribution.
- The Government encourages and protects the oil exploration and exploitation
abroad conducted by Vietnamese businesses.
2.4. Development of new and renewable energy
- Explore and make planning for new and renew-
able energy.
- Enhance the public awareness to increase the
use of new and renewable energy.
- Include the use of new and renewable energy
into energy saving programs and other national pro-
grams such as rural electrification programs, forestation,
clean water programs, etc….
- Encourage businesses to invest in production,
ANNEX
Special Economic Bulletin 2009 - Page 41
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assembly and amendment of new energy facilities such as small- scale hydro power, wind
engines, bio-gas, etc… Encourage hi- technology transfer in new energies like solar en-
ergy, wind energy, etc…
- Support investment in research, manufacture and pilot operation of new and re-
newable energy establishments through tax incentives for the import of equipments and hi-
technologies, production and distribution, protection of copyright of inventions and techni-
cal patterns, etc…
ANNEX
VIETNAM HIGHWAY NETWORK DEVELOPMENT PLAN BY 2020
AND VISION BEYOND 2020
1. Goals
- To quickly develop the national ex-
pressway network and ensure the connection
among key economic centers, major border
checkpoints and important transportation hubs.
To concentrate on the development of North-
South Highway with priority given to road
links connecting major cities (Hanoi, Ho Chi
Minh City, Da Nang) with seaports.
- To strengthen the use of multi- mode
transportation for closer transport integration
with other countries.
- Expressway networks must be closely
linked with the current road networks.
- To solve traffic congestion, particularly in major cities such as Hanoi and Ho Chi
Minh City.
2. Planning for highway network development in Vietnam
a) North - South Highway Route includes 2 routes, 3,262km
- The Eastern North - South Highway 1,941km;
- The Western North - South Highway 1,321km.
b) 07 routes connected to Hanoi 1,099km
- Lang Son - Bac Giang - Bac Ninh, 130km;
- Ha Noi – Hai Phong, 105km;
- Ha Noi – Viet Tri – Lao Cai, 264km;
- Noi Bai – Ha Long – Mong Cai, 294km;
- Ha Noi – Thai Nguyên – Cho Moi (Bac Kan), 90km;
- Lang – Hoa Lac – Hoa Binh, 56km;
- Ninh Binh – Hai Phong – Quang Ninh, 160km.
c) Highway networks in Central and Highland regions, including 03 routes, 264km
ANNEX
Special Economic Bulletin 2009 - Page 43
Page 44 - Special Economic Bulletin 2009
- Hong Linh (Ha Tinh province) –
Huong Son (Ha Tinh province), 34km;
- Cam Lo (Quang Tri province) –
Lao Bao (Quang Tri province), 70km;
- Quy Nhon (Binh Dinh province)
– Pleiku (Gia Lai province), 160km;
d) The Southern highway net-
works including 07 routes, 984km
- Bien Hoa (Dong Nai province) –
Vung Tau (Ba Ria – Vung Tau), 76km;
- Dau Giay (Dong Nai province) –
Da Lat (Lam Dong) 209 km;
- Ho Chi Minh City – Thu Dau Mot (Binh Duong province) – Chon Thanh (Binh
Phuoc province), 69km;
- Ho Chi Minh City – Moc Bai (Tay Ninh province), 55 km;
- Chau Doc (An Giang) – Can Tho – Soc Trang, 200 km;
- Ha Tien – Rach Gia (Kien Giang province) – Bac Lieu, 225 km;
- Can Tho – Ca Mau, 150 km.
e) Ring-roads in Hanoi and Ho Chi Minh, 264km.
ANNEX
My Thuan Bridge
NATIONAL PROGRAM ON RESPONSE TO CLIMATE CHANGE
1. Principles and directions
1.1. Principles
- Responses to climate change is based on
sustainable development, systematic, integrated,
cross-sector and inter-regional, gender equality and
poverty reduction principles.
- Climate change response activities are im-
plemented with specific focuses, ensuring a good
response to both short- term and long- term im-
pacts. Investment in climate change responses is of
crucial importance to secure the sustainable devel-
opment
- Climate change responses are responsibilities of the whole society, all citizens and
needed to be implemented with high public consensus and resolution.
- Climate change responses must be institutionalized into laws.
- Climate change response activities must be in conformity with principles as set
forth in the UN Convention on Climate Change.
1.2. Implementation roadmap
- Phase I (2009 – 2010): Start- up.
- Phase II (2011 – 2015): Implementation
- Phase III (after 2015): Development.
2. Objectives:
Key objectives are to evaluate impacts by climate change on specific sectors and
regions in each period and develop viable action plans for effective response to climate
change in both short-term and long-term periods with a view to ensure the sustainable de-
velopment, to develop a low- carbon based economy and cooperate with the international
community in an effort to mitigate climate change impacts.
3. Some directions
The core tasks include:
1. Evaluate impacts by climate change in Vietnam;
2. Formulate solutions to deal with climate change;
ANNEX
Special Economic Bulletin 2009 - Page 45
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3. Design science and technology programs in response to climate change;
4. Strengthen the capacity in response to climate change;
5. Enhance the public awareness and develop human resources;
6. Strengthen the international cooperation;
7. Integrate climate change into social- economic development strategies, programs
and plans.
8. Develop action plans of ministries, sectors and localities to deal with climate
change;
9. Design and implement projects, sub- programs of the national Program in re-
sponse to climate change.
In short run, it is a need to evaluate climate change developments and forecast cli-
mate change scenarios, particularly sea-level increase, and then assess impacts by climate
change on different socio- economic fields.
4. Financial mobilization
The Program is designed for the period 2009- 2015 with an estimated budget of
around 1,965 billion VND (about 110 million USD), of which 50% shall be mobilized
from domestic resources (governmental budget 30%, local budget 10%, other sources
10%) and the remain shall be mobilized from foreign resources.
ANNEX
Ministry of Foreign Affairs of Vietnam
Department of Economic Affairs
THE BOARD OF EDITORS
Address: No.7, Chu Van An Street, Hanoi, Vietnam
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