~ Le ViÍt Nam, aujourd'hui. ~
The Vietnam News

[Year 1997]
[Year 1998]
[Year 1999]
[Year 2000]
[Year 2001]

Vietnam economy faces litany of woes

HANOI - Vietnam painted a gloomy picture of the country's economic prospects on Tuesday and warned its 79 million people to expect tougher times ahead.

Deputy Prime Minister Nguyen Tan Dung said gross domestic product growth would continue to slow while industrial output expansion was at its lowest level in several years.
The outlook for foreign investment, export growth and domestic consumption was also worrying, Dung said in a speech at the opening of the country's National Assembly.

Despite the woes Vietnam had managed to maintain political stability and achieve a slight reduction in poverty, he added.
The National Assembly, Vietnam's legislative organ, meets twice a year. During the current session delegates are expected to approve four new laws including a landmark text aimed at ending discrimination against the private sector.

``Our social and economic situation in the last several months has exposed many weaknesses and growing difficulties,'' said Dung, who is also governor of the central bank.
``These weaknesses in the social and economic sphere will require much effort and time to overcome and they will have a direct impact on the implementation of targets for this year.''

Targets relating to the country's balance of payments, foreign debt and overdue loans were already in doubt, he said.
Dung gave no details of those figures, nor did he say if Vietnam would lower its 1999 GDP growth target of 5-6 percent. Hanoi said last week that GDP grew four percent in the first quarter of 1999 compared with the same period last year.

Vietnam estimated GDP growth in the last calendar year at 5.8 percent, from 8.2 percent in 1997.
The Asian Development Bank has predicted Vietnam would grow 3.7 percent this year, while the International Monetary Fund has said the figure could be below three percent.

However, those estimates of positive growth have failed to hide Vietnam's dimming allure for foreign investors and poor export performance, both of which have put a strain on the country's hard currency reserves.
Tran Xuan Gia, minister of planning and investment, insisted Vietnam was trying to meet the demands of foreign businessmen frustrated with bureaucracy and high costs.
He said Hanoi was creating a stable environment for foreign companies to make money.

Underscoring Vietnam's fading business lustre, Dung said inflows of foreign investment reached $250 million in the first four months of the year, well down on the previous period.
He gave no clear comparison, but said the figure showed a marked decline. Dung also said foreign investment pledges in the first four months were $358 million, from $1.07 billion in the same period last year.
Dung bemoaned problems such as rising unemployment, drug abuse, prostitution and smuggling.

He also repeated the familiar theme that Hanoi would focus on agricultural growth -- 80 percent of the population live in rural areas -- and tap Vietnam's internal financial resources.

Reuters - May 4, 1999.