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Vietnam

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  VIETNAM

REPUBLICAN REFERENCE

Area (sq.km)
329,560

Population
79,939,000

Capital
Hanoi

Currency
dong

President
Tran Duc Luong

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Background:
France occupied all of Vietnam by 1884. Independence was declared after World War II, but the French continued to rule until 1954 when they were defeated by communist forces under Ho Chi MINH, who took control of the north. US economic and military aid to South Vietnam grew through the 1960s in an attempt to bolster the government, but US armed forces were withdrawn following a cease-fire agreement in 1973. Two years later North Vietnamese forces overran the south. Economic reconstruction of the reunited country has proven difficult as aging Communist Party leaders have only grudgingly initiated reforms necessary for a free market.

Update No: 03

While the Vietnamese government is busy preparing to receive its big neighbour's president and Party Chief, Jiang Zemin who arrived in Hanoi on 27th March, most of the Vietnamese don't feel impressed with Jiang's trip. By contrast, locals were much more eager and excited before and during the visits paid by US President Bill Clinton in November 2000 and Russian President Vladimir Putin in March 2001.
Many people have expressed concerns that Vietnam will be come little more than a dumping ground for cheap Chinese goods and if this happens, domestic and foreign investment in the country will be seriously hurt.
Jiang's visit has made locals seriously consider the pros and cons of hand-shaking with China and the US. Many Vietnamese officials are feeling it will be easier to cooperate with neighbouring China, rather than lean towards the distant US who still take a tough stance on many subjects, observers said. "Many Vietnamese officials will be able to cling to their jobs if Vietnam chooses closer relations with China, whilst they will be out of their jobs if Hanoi chooses to go with the US," a Hanoi-based scholar noted. Public opinion is divided as another scholar argued that if they accept a Chinese-style friendship recipe, they will "tie Vietnam to a giant neighbour who is greedy", adding that Vietnam mustn't be a seen as a Chinese backyard, which will never get a chance to grow. 
Although the neighbourly friendship between the two nations was referred to many times by Jiang during his trip, China and Vietnam are having tough territorial disputes in the East Sea which was the biggest problem on which Jiang was unable to reach final agreement about with top Vietnamese leaders during three-day visit. 
Party Chief Nong Duc Manh, the most powerful man in Vietnam and President Tran Duc Luong and Jiang only pledged to continue talks to solve territorial disputes in the East Sea and not to use, or threaten to use, force. Also, problems hindering the implementation of the agreement on fishing cooperation in the Tonkin Gulf and the treaty on Tonkin Gulf delimitation, signed in 2000 were not solved. 
They agreed to continue landmark installation under the Land Border Treaty signed in 1999, that is strongly criticized by local people. The leaders expressed their satisfaction over developments in bilateral relations, and agreed to continue regular meetings between the two countries' high-ranking officials and to further boost cooperation in trade, investment and tourism. 
After the meetings, the leaders witnessed the signing of an agreement on economic and technical cooperation, and a soft-credit agreement. 
However, despite the fact that opinion on Hanoi's streets vary, trade turnover between Vietnam and China is growing fast, reaching US$2.8 billion last year, up from US$2.4 billion in 2000 and US$30 million in 1991. 
Vietnam's exports to China last year amounted to US$1.4 billion, accounting for 9% of the country's total. The country is exporting materials, consumer goods, seafood, fruit, confectionery, rubber latex, coal and crude oil to China, and importing motorbikes, engines, cloth, ceramics, chemicals and consumer goods. The two countries expect bilateral trade turnover this year of US$3 billion and US$5 billion in 2005. 
With 107 projects worth US$214 million, China is the 28th-ranked foreign investor in Vietnam in 2001. Sixty projects worth US$68.7 million have already begun operation. 
Overall, the country gained saw industrial production value growth in the first two months of the year of 14.3% over the same period last year, reaching VND38.89 trillion (US$2.6 billion), reported the General Statistical Office (GSO). 
The domestic private sector continues to prove its increasing flexibility and dynamism, recording the highest growth of 22.8% year-on-year with value of VND9.36 trillion (US$627 million). State-owned enterprises and foreign-invested sectors registered expansion rates of 11.6% and 12.1%, valued at VND16.35 trillion (US$1.06 billion) and VND13.18 trillion (US$861 million) respectively. 
Due to the long Tet holiday, production values in February fell 16% Month-on-month, yet were still 1.5% up on the same month last year. The state industrial sector is shrinking, with the two-month production value making up 42% of the total, down one percentage point year-on-year. 
All key industrial products recorded growth in Jan-Feb, except crude oil. Crude production value fell by 6% year-on-year. Industries with high growth in the two-month period included diesel engines at +97%, machinery and equipment +73%, transformers +61%, seafood processing +28%, steel +25%, automobiles +29%, motorbikes +25%, cement +21% and electricity +12%. 
Experts remarked that the 14.3% growth is considerable but will be difficult to maintain unless effective measures to find outlets for industrial products are introduced. They are also concerned with the low production value generated by the oil industry due to the lower world price, which consequently affects export earnings. 

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AUTOMOBILES

New Mitsubishi car launched by joint venture


A new five-seat Mitsubishi car, Lancer, was launched on February 26 by the Ngoi Sao (Star) Company, the only carmaker and distributor in Vietnam affiliated to Mitsubishi, Nhan Dan has reported.
Ngoi Sao is a joint venture set up by Mitsubishi Motors (Japan), Mitsubishi Corporation (Japan), Proton (Malaysia) and Trancimexco (Vietnam). 
The joint venture marked their 5000th car made in Vietnam last October. Ngoi Sao Company sold 1,612 cars in 2001, an increase of 68% against the figure of the previous year.

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AVIATION

Vietnam Airlines opens new route to Siem Riep


Vietnam Airlines has opened a new air link to Siem Riep, Cambodia from Hue.
The first flight will be on March 16, 2002, at Phu Bai airport. The airline will use Fokker crafts to fly on the route. Each craft can carry from 60 to 70 passengers. The Huong Giang tourism company has started offering tours to Siem Riep for three nights and four days at a cost of US$423.
Mr Nguyen Xuan Ly, Thua Thien - Hue people's committee vice chairman, said the province and Vietnam Airlines will soon open another route to Luang Prabang, Laos.

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FINANCIAL NEWS

Vietnam's economic integration assessed

"Over the last decade, Vietnam has made considerable progress in the process of international economic integration," said Deputy Prime Minister Nguyen Manh Cam in his opening speech at a workshop entitled 'Vietnam's economic integration and donors' assistance' held in Hanoi on February 27th. 
Mr Cam, who is also Chairman of the National Committee for International Economic Co-operation (NCIEC), chaired this workshop. Participants in the workshop, which was organised by the United Nations Development Programme and the NCIEC, heard consultants' reports on the implementation of Vietnam's commitment to international economic integration; the donor community's technical assistance to Vietnam in recent years since Vietnam's entry into a number of regional and world economic organisations; and the Vietnamese government's Action Plan for International Economic Integration. 
Mr Cam said that Vietnam has joined large regional economic organisations such as ASEAN, ASEM, and APEC, signed a framework agreement on economic co-operation with the European Union, reached substantial arrangements with the IMF and the World Bank for structural adjustment and poverty elimination, taken part in Japan's Miyazawa Plan and recently signed and enforced the Vietnam-US Bilateral Trade Agreement. 
In an effort to step up its bid for entry into the World Trade Organisation, Vietnam sent its initial offer for market access to the WTO Secretariat and its member countries last December, Mr Cam said. 
Vietnam's international economic integration commitments include reducing tariff rates and non-tariff barriers, opening the door for services, investment, intellectual property; reforming State-owned enterprises; developing the private economic sector; and settling conflicts. 
Vietnam has been receiving support from a number of international organisations for its international economic integration. Trade policy, managerial capacity, and reorganisation of State-owned enterprises are the areas receiving the most financial support in the form of non-refundable aid. 
Representatives of donors praised Vietnam's renovation efforts and agreed that Vietnam needed more technical assistance to step up its international economic integration process, particularly to improve its economic renovation, legal system, competitive capacity, and administrative reform. (VNA)
Hanoi has invested VND 978 billion on public transport including rehabilitation of busy intersections, embankment of Red River dykes and resettlement areas for people who have had to move because of traffic projects.
The money is also being spent on purchasing 320 new buses, bringing the total number of buses in the city to 570.

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