Explaining the 3 reasons for Vietnam's economic growth! Introduced at the World Economic Forum | Purchase, investment and rental of real estate in Ho Chi Minh

It was reported as "The Miracle Growth Made by Vietnam" at the World Economic Forum organized by 2500 intellectuals, experts, and international political leaders.

When you take a walk in Hanoi, the capital of Vietnam, you can feel infinite energy wherever you are. Hanoi citizens make phone calls while riding scooters, a variety of foods are traded in countless small stores, and commuters and commuters travel through the city. The average age of Vietnamese citizens is younger, and as the years go by, everything feels feasible.

Thirty years ago, Vietnam was one of the poorest countries in the world. Do you know how the poorest countries in Southeast Asia can become middle-income countries? In 1975, the 20-year Vietnam War ended. Vietnam's economy is one of the poorest countries in the world, and the five years since 1975 have been the toughest. In 1986, the government introduced the "Doi Moi Policy" as a series of economic and political reforms, leading it to become "a socialist-oriented market economy."

Vietnam is currently one of the world's stars in emerging markets. Economic growth of 6-7% is comparable to China. From Nike sportswear to Samsung smartphones, they are manufactured and exported around the world in these ASEAN countries. The Financial Times commented that the unemployment rate is fairly low and there are no idle facilities.

What happened to this growth miracle? According to the World Bank and Think Tank Brookings Institute, Vietnam's economic growth can be explained by three main factors.

Trade liberalization
Reduce entry barriers for foreign capital through deregulation
Large investment in human capital and physical capital as public investment

Regarding the first factor, it points out various free trade agreements that Vietnam has concluded over the past 20 years. In 1995, Vietnam joined the ASEAN Free Trade Area. It signed a free trade agreement with the United States in 2000 and joined the World Trade Organization in 2007. Since then, further ASEAN agreements have been signed with China, India, Japan and South Korea, and the Trans-Pacific Partnership came into effect this year.

Regarding the second factor, in 1986, the country enacted the first Foreign Investment Law, allowing foreign companies to enter Vietnam. Since then, regulations for investors have been gradually relaxed with the aim of reducing administrative bureaucracy and promoting foreign investment in Vietnam.

According to the World Economic Forum's Global Competitiveness Report, Vietnam climbed from 77th in 2006 to 55th in 2017. In the World Bank's business environment rankings, it increased from 104th in 2007 to 68th in 2017.

The Vietnamese government has certainly invested in human capital and physical capital. Vietnam's population is growing rapidly and is currently 95 million, half of them under 35, a significant increase from 60 million in 1986. Due to the increasing population, the demand for human resources from the market is expected to increase significantly, and as a result, the Vietnamese government has made a large public investment in primary education.

We are also investing heavily in physical capital. Road maintenance and internet environment are maintained. Currently, investment in power shortage is progressing.

Vietnam has grown into a center for foreign investment and manufacturing in Southeast Asia. Manufacturing companies such as Samsung Electronics, LG Chem, Olympus, and Pioneer have precision manufacturing companies in Japan and Korea as well as many apparel manufacturers. By 2017, Vietnam was the largest exporter of clothing in the region by 2017 and the second largest exporter of precision equipment after Singapore, according to the Financial Times.

⇒The World Bank predicts that Vietnam's GDP will grow by 4.9% in 2020

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