[QODLink]
Asia-pacific
Vietnam's economy runs out steam
Reforms assume urgency as property-market collapse hits banks, inflation rises and credit rating gets downgraded.
Last Modified: 04 Oct 2012 16:37

Vietnam has had one of the fastest growing economies in the developing world. In 2007, the country got more foreign investment than the Philippines, Thailand and Indonesia combined.

However, inflation is high and the country's credit rating has just been downgraded.

The economy is still growing at 4.7 per cent, but abandoned construction sites offer evidence that Vietnam is not quite the Asian Tiger it was a few years ago. And the collapse of the property market has left banks in a mess.

Officially bad debts stand at 10 per cent of their portfolio, but experts say it is probably more like 15 per cent of loans that will not be repaid.

The government says that by next year it will have reformed its policies and the economy will be much healthier. But many of those who have benefited most from the boom years are also in powerful positions.

Reform would mean relinquishing control and, as Al Jazeera's Wayne Hay reports from Hanoi, that is something they may not be prepared to do.

170

Source:
Al Jazeera
Topics in this article
People
Country
City
Featured on Al Jazeera
More than one-quarter of Gaza's population has been displaced, causing a humanitarian crisis.
Ministers and MPs caught on camera sleeping through important speeches have sparked criticism that they are not working.
Muslim charities claim discrimination after major UK banks began closing their accounts.
Italy struggles to deal with growing flood of migrants willing to risk their lives to reach the nearest European shores.
Featured
Report on child sex abuse in British Asian community highlights issues that may affect the entire nation.
Taliban makes quick gains in Afghanistan with little opposition from Afghan army as US withdrawal begins.
Analysts say China moving back toward 1950s-era public trials aimed at shaming and intimidation.
Record numbers of migrants have made harrowing sea journeys to Italy and Greece this year.
In Vietnam, 40 percent of all pregnancies are terminated each year, a rate that health officials are hoping to reduce.
join our mailing list