Vietnam's economic growth last year was contributed by the industrial sector, which increased 16%, and exports, with a growth rate of 21%. In foreign investment, Vietnam was described as a "stand out" in East Asia with annual foreign direct investment averaging US$1.4 billion in 2001-2003. Vietnam and China were the only East Asian countries that saw their net FDI make up 4% of the GDP, the percentage of most other countries was 2%.

 

The bank explains rising inflation in the first two months is due to bird flu, increase in prices of oil and other key imports, and depreciation of the U.S. dollar. It says Vietnams stock market has been the best performing in Asia so far with 66% gain. Steps are taken to boost the market, including easing listing requirements, allowing listing of joint stock banks and permitting the establishment of foreign affiliated investment funds. The Government is considering increasing the foreign ownership limit in listed companies to 49% from 30%.

 

The bank expects Vietnam's economy to grow 7% this year. However, the country is facing many challenges ahead, such as preparing for WTO accession and creating a sound financial system to keep up the momentum and quality of growth and poverty reduction.

 

GDP growth in some Asian countries (%)

 

 

Source: UNDP April 2004

Country/territory	2003	2004 (est.)
INDONESIA	4.1	4.8
MALAYSIA	5.2	5.5
PHILIPPINES	4.5	5.4
SINGAPORE	1.1	4.7
THAILAND	6.7	7.5
VIETNAM	7.2	7.5
CHINA	9.1	8.5
HONGKONG	3.3	6.0
SOUTH KOREA	3.1	4.5
TAIWAN	3.3	5.4