Vietnam’s economy back in 1945 was mainly driven by a backwards and fragmented agriculture sector. Its industrial sector, meanwhile, was tiny. After the August Revolution in 1945, Vietnam faced a host of economic challenges, in particular empty State coffers. The Party and the Government therefore had to take on a range of tasks, including consolidating the Government and armed forces, fighting the enemy, recovering production, and addressing the consequences of famine, floods, etc.
From nothing in 1945, Vietnam’s GDP had grown to 14 billion USD in 1985 and 267 billion USD in 2019, ranking it 46th worldwide. The World Bank, in its Vietnam Systematic Country Diagnostic report, spoke highly of the country’s development, from one of the poorest in the world just a generation ago to a thriving middle-income economy. Largely isolated from international trade at the beginning of its transition, Vietnam is today an export powerhouse and major destination of FDI, the bank said.
Notably, its once-backwards and fragmented agriculture sector is now among the driving forces of its economy. Indeed, Vietnam became a food exporter in 1989 and is now among the largest agro, forestry, and fishery exporters worldwide, with average annual export value of 1 billion USD.
Its industrial sector has also changed dramatically. Its proportion in the economic structure has increased significantly, with more and more advanced technologies being applied. The service sector has also seen exponential growth, especially in tourism, which is now a new growth driver for Vietnam’s economy.
Vietnam has been proactive in negotiating free trade agreements (FTAs) in an attempt to integrate more deeply into the regional and global economies. Such efforts have been confirmed by the signing of 16 FTAs, 224 trade partnerships established, of which more than 70 countries are export markets of Vietnam, relations started with over 500 international organisations, 71 countries recognising Vietnam as a market economy, numerous trade deals signed between Vietnamese localities and foreign partners, and thriving relations with the world’s largest financial organisations, like the World Bank, the International Monetary Fund, and the Asian Development Bank, etc.
Prime Minister Nguyen Xuan Phuc, on the occasion of National Day, September 2, said this year is different, as COVID-19 has triggered not only a health crisis but also severe financial turbulence on a global scale. Still, Vietnam’s economy has been stabilised at this point, with GDP in the first half of this year in positive territory, at nearly 2%.
The country has also posted a trade surplus of nearly 11 billion USD so far this year. The Government has performed its role of facilitating economic growth and boosting economic reforms, sustainably restructuring the economy and shifting it towards a digital economy. Such efforts will be measured by businesses’ and people’s satisfaction. Party leader and State President Nguyen Phu Trong once said that “Vietnam has never seen such development, potential, prestige, and reliability as now.” Indeed, Vietnam has recorded remarkable economic achievements over the past 75 years./.
