Vietnam's economy runs out steam

Reforms assume urgency as property-market collapse hits banks, inflation rises and credit rating gets downgraded.

    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.

    SOURCE: Al Jazeera


    YOU MIGHT ALSO LIKE

    The woman who cleans up after 'lonely deaths' in Japan

    The woman who cleans up after 'lonely deaths' in Japan

    When somebody dies lonely and alone, Miyu Kojima steps in to clean their home and organise the mementos of their life.

    Putin and the 'triumph of Christianity' in Russia

    Putin and the 'triumph of Christianity' in Russia

    The rise of the Orthodox Church in Russia appears unstoppable, write filmmakers Glen Ellis and Viktoryia Kolchyna who went to investigate the close ties between the church and Putin.

    The chill effect: Is India's media running scared?

    The chill effect: Is India's media running scared?

    Much of India's media spurns a scoop about the son of PM Modi's right-hand man. Plus, NFL as platform for race politics.