This site presents an analysis of the Vietnamese government's economic policies compared to a list of 34 economic policies as prepared by student Bryan Le with the McKeever Institute of Economic Policy Analysis (MIEPA). These studies were written in December of 2016. To read the analysis scroll through this site. To learn more about the background policies, click here
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Native born Vietnamese student Bryan Le living in California has completed a study of the Vietnamese government's economic policies as compared to the MIEPA list of policies as outlined previously. The study on Vietnam by Bryan Le is shown immediately below. The ratings herein are based on the following rating scale:
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2016. Used herein with permission]
RATING SUMMARY - BRYAN LE POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE 1 1.0 3.0 15.0 20 % 2 1.0 3.0 15.0 20 3 1.0 3.0 15.0 20 4 1.0 3.0 15.0 20 5 1.0 3.0 15.0 20 6 2.0 6.0 15.0 40 7 5.0 15.0 15.0 100 8 2.0 6.0 15.0 40 9 2.0 6.0 15.0 40 10 1.3 3.9 15.0 26 11 5.0 15.0 15.0 100 12 5.0 10.0 10.0 100 13 1.5 3.0 10.0 30 14 4.5 9.0 10.0 90 15 4.0 8.0 10.0 80 16 2.5 5.0 10.0 50 17 1.5 3.0 10.0 30 18 1.0 2.0 10.0 20 19 1.0 2.0 10.0 20 20 1.5 3.0 10.0 30 21 1.0 2.0 10.0 20 22 1.0 2.0 10.0 20 23 1.0 2.0 10.0 20 24 1.0 2.0 10.0 20 25 1.0 2.0 10.0 20 26 1.0 2.0 10.0 20 27 2.4 4.8 10.0 48 28 1.0 2.0 10.0 20 29 4.5 4.5 5.0 90 30 1.4 1.4 5.0 28 31 1.0 1.0 5.0 20 32 1.2 1.2 5.0 24 33 3.5 3.5 5.0 70 34 2.3 2.3 5.0 46 TOTAL 69.1 144.6 365.0 39.6% ===== ====== ===== =====
INDIVIDUAL POLICIES - BRYAN LE
1. Freedom from internal control 1.0
From the Human Rightís Watch, and a google search of human rights watch of Vietnam, we can determine that the rights of the vietnamese people are very miniscule.1 Their government is still under communism and many upon many of the rules that involve the rights of the vietnamese people are greatly influenced by the state. As stated in Vietnamís Civil Code, Section 2, Article 2; ďThe establishment and performance of civil rights and obligations must not infringe upon State interest...Ē.2 Vietnam is looking after its own interest and will do whatever is necessary, as we will see in the next couple of points to see how it keeps its citizens in check under the communist regime.
2. Freedom of speech 1.0
Under the communist regime, Vietnam has been keeping a tight grip on the speech of the Vietnamese and how it is used against them. In a pretty recent case, Vietnamís blogger, Nguyen Huu Vinh, better known as Anh Ba Sam, has been a very proactive blogger against the government, show many of the flaws and corrupts that went on in the country.1 He was later detained sentenced to 5 years for posting pessimistic views upon. Vietnam has also gone to great lengths to silence the masses, even going to lengths to shut down Facebook when Obama came to visit Vietnam.2 Vietnam, just due to its nature of being Communist, will restrict all forms of press and speech if they go against the government. Therefore, Vietnam receives a score that represents their interest.
3. Effective, fair police force 1.0
Police in Vietnam are far from fair, with corruption that can be seen on all levels. 1 In many cases and many stories, from family members to surveys, the Vietnamese police are the most corrupt police that you will see and many encounters are usually resulted in some sort of extortion or bribery. 2 Even now, in 2016, Vietnam is still struggling with corrupt, though they are trying to battle against the corruption of their own police force. 3. Sadly with a police force that is not able to uphold the law, due to the very poverty lined country this country has been treading, this country receives a low score.
4. Private property 1.0
Vietnam doesnít really have land rights, and its protection of land rights is pretty bad.1 With so much corruption, nepotism, lack of accountability and very little transparency, property is not respected in the least bit and would generally take years to dispute.2 It is actually very detrimental to the country, as the nation is very volatile and corrupt in nature that this owning housing or buildings in Vietnam is a detriment, as money doesnít circulate into the economy, but into the pockets of officials that are ďpolicingĒ the neighborhood. The rights of Vietnamese that own any property is very small and thus the score will reflect that.
5. Commercial banks 1.0
It is hard to see people or even investors keep money in Vietnam when you ask all your relatives and your family members if they keep any of their money in Vietnam and all of them reply in no.1 My father told me that Vietnam has always had a terrible banking system as many of them always go bankrupt, or try to declare bankruptcy. In the statement released Vo Tri Tranh, the former Vice President of the Central Institute of Economic Management, said that it wasnít the appropriate time to declare for many banks and that the banks are unable to achieve sustainability.2 Vietnam has had the struggle of maintaining any deposits due to its 0 percent interest rate.3 The country has had to resort to promotions and gifts to try and keep their customers and deposits within the country. With a no more interest for deposits and many other banks outside of Vietnam that offer such benefits, Vietnam receives a terrible score.
6. Communication systems 2.0
When I recall going back to Vietnam, it wasnít an issue with getting advertisement in a rich city, such as Saigon, Hanoi, or Da Lac, as those cities had all these services, excluding skywriting.1 Because of how rural Vietnamís lands are, having such services and facilities such as fax, newspaper, magazines and billboards are left in ruins and arenít really worth advertisements because they donít have money. For a business to have internet at a remote location, i have seen houses in the middle of nowhere to have a computer set-up with internet. With internet, their are many opportunities for phone/fax/tv/radio services such as the magicjack, facebook messenger, skype etc. But due to vietnamís majority being under the poverty line, many still rely on internet cafeís for their use of internet, we see that we still have 50% of the people not having internet.2 With a heavy increase over the past 10 years, we will expect Vietnam to have many of its population with more communication excess in the next few years. With all these users able to get internet access, we shall give Vietnam a decent score.
7. Transportation 5.0
Vietnam has many modes of transportations, which include lorry, train, boat and airlines.1 With three ports, two airports and four organisations that handle sea, air road and rail for Vietnam, they are very well adept in handling transportations of goods. Vietnam has been known for cheap services, and they are also very cheap in terms of transportation of goods via a car.2 Renting a person and a car would only be at max $100 dollars a day, which is very cost effective when it comes to mass producing in Vietnam and then exporting it to another country. With this many terms of transportation, Vietnam gets a very strong score.
8. Education 2.0
Vietnam does have a basic education system, so many of the population that are in their younger ages are educated through high school, which does include literacy and education of basic sciences, and languages.1 Vietnam does have 55 universities, but these universities are very hard to attend, with extremely high costs and being restricted due to the communist regime.24 Vietnam does have an ever growing literacy rate, which is now over 90%, which has greatly improved compared to 10 years ago.3 As for comparing Vietnam to say one of the industrialized countries, we see that American topples in many fields, especially when we see that America has a tertiary enrollment of 72.6% compared to Vietnamís 9.7%.
9. Social Mobility 2.0
Sadly Vietnam isnít the best in terms of social mobility. Vietnam pays very little and though it is looking for newer more educated people, are having a difficult time hiring well educated people.1 Vietnam is looking for many higher skilled jobs, so it does have jobs that are open for these people, but nothing tempts high skilled workers when there is no money there.2 This is why Vietnam has many blue collar jobs and many jobs that are not for skilled people.3 Even though Vietnam does have the jobs available, the education system just isn't strong enough to grant people to these higher paying jobs. So weíll have to look back in a couple of years to see if anything changes.
10. Freedom from outside control 1.3
Vietnam does have an issue with the Chinese, where the Chinese are willing to pay for Vietnamese brides because their male population canít afford their own countries women's, but this is an issue with Vietnamese people taking advantage of other Vietnamese people.1 The country is not under any control from any other nation and the only relevant issue that has the Vietnamese people conflicted is the land dispute for the Southern China Sea.2 By analysis, and seeing the threat of other countries, we see that Vietnam is also causing these issues of citizen safety, so then Vietnam gets a low scores. It does try to police against these actions, but to see statistics where hundreds of women are abducted annually is very sad.3
11. Protection of Domestic Enterprises 5.0
Vietnam is known as the 28th largest exporting economy in the world and does export more than it imports, as of 2014.1 Vietnam generally has an open trade market for the incentive of having internal domestic reform by opening themselves up to other countries and speeding up domestic reforms in hopes of strengthening economic cooperation with other economies.2 The country does have many connections, by which it is part of the APEC(Asia-Pacific Economic Cooperation), TPP(Trans- Pacific Partnership), RCEP(Regional Comprehensive Economic Partnership) and the ASEAN(Association of Southeast Asian Nations), all of which have trade agreements that allow Vietnam to benefit from lowered tariffs on 24 countries. All of these have the goal in mind of helping Vietnam grow as a whole, and not with specific industries to try and grow Vietnam. It is with this that Vietnam does get a large score for its attempts at growing, as well has having more exports than imports.
12. Foreign currency transactions 5.0
When it first went back to Vietnam, my father did have a large amount of 100 dollar bills.1 This would eventually be turned into the Vietnamese d?ng and my father would go along with business using the vietnamese currency. Never from my personal experience did we encounter using any other currency. The vietnamese are also not well educated enough to know the exchange rates of currency that isnít their own, which also comes from prior visits to Vietnam. So it isnít in their best interest to believe in foreigners. When it comes to foreign exchange for currency, then we see that the Vietnamese are keeping tight control in that in all currency must be able to be converted into the Vietnamese d?ng before it can be handled. It is with this much amount of control before they even begin to do business, that Vietnam will get a solid score.
Personal Family Experience
13. Border control 1.5
How do i evaluate a country when during this report, Vietnam catches a group trying to smuggle heroin into the country.1 Vietnam hasnít honestly been trying to stop the smuggling that has been going around, which only leads to the smuggling issue to increase.2 With how corrupt in nature the government is and how ineffective their police force in, its very depressing to see the country in this state. Sadly Vietnam confiscates only 9 million packets of the nearly 1 billion that is actually consumed by the nation.3 Vietnam has not only had issues with drugs, but with their population, as the neighboring country of China is willing to ďbuyĒ Vietnamese brides from Vietnam and this leads to the still ever growing human trafficking of Vietnam.4
14. Currency 4.5
Vietnam, while going through a few different rules and phases, has a multiple types of currencies.1 When looking back at their history, of having currency under the French indochinese piastre. After Vietnam developed its own currency, the Vietnamese d?ng, it stuck with this currency for almost a decade. Regardless of the war, which did change the value of the southern Vietnamese d?ng, Vietnam has more or less stuck to one type of currency for the past 100 years, which is what mostly everybody in Vietnam uses nowadays. Even with the new editions of bills in Vietnam such as the five hundred thousand d?ng, the currency still remains the same and so spending in this country is very simple.
15. Cultural, language homogeneity 4.0
Vietnam is a country that is mostly filled with Vietnamese that do speak Vietnamese. It was only back in the 1970ís was it an issue when Vietnam discriminated against the Chinese that lived in Vietnam, which led to the well known ďboat people.Ē1 Vietnam has also had to peacefully had to deal with the hidden issues of the north versus the south.2 Vietnamese cultures are slightly different from north to south, and many of their ideals just donít agree, which lead to conflicts.3 This has mostly been peaceful, of conflicts, and for that, Vietnam will receive a solid score, for most of its peaceful conflicts.
Families experience in Vietnam/America
16. Political effectiveness 2.5
Vietnam has been known to care for its population on a few cases, but not all. Vietnam has been helping rural areas get out of poverty, but this isnít like it can overlook its main problems of corruption.1 Vietnam is not known for its public terrorists attacks, but it is shown that there are events of terrorism that do take place in Vietnam, that sadly are the cause from the government to scare its people.2 The Vietnamese government has been using many scare tactics, and some include violent attacks on protest leaders to try and silence their works. Vietnam is not a country that is affected much by terrorism because it keeps to itself very much, and any such terrorism that happens can easily be swept under the rug of the communist government. Because Vietnam uses terrorism to govern its people and shut down open opinions Vietnam receive a middle ground score because it is run in a communistic manner, it protects its interest by shutting down anything that opposes it. This in no way does promote business that the government doesnít see fit, so Vietnam gets a situational middle ground score.
17. Institutional stability 1.5
Vietnam being a communist party, particularly under the rule of the Communist Party of Vietnam (CPV) has been under this rule since 1930, when it was under the name of Indochina Communist Party.1 The communist party has kept a strong hand in the government and with that they have struggled with their government being very corrupt in nature.2 This further increases the risk of what my parents would call mandatory bribery in order to maintain a business.3 Even though Vietnam has been under the CPV rule for many almost a century, the corrupt nature of Vietnam and its its constant bribery hasnít stopped people from attempting businesses in Vietnam due to cheap labor costs. Based on the criteria in which iím judging, the institution has remained constant, but far from ideal for an business. With bribery and corrupt of local government, the score is low, but not the lowest.
Personal: Parents experience living in Vietnam for 30+ years.
18. Honest government 1.0
My mother has always told me that Vietnam was a very scary place and that many people were corrupt, but it's very hard to find such incriminating documents when the government is communist and controls their environment well.1 This can be shown apparent with the private organization that publishes the corrupt index number that depicts how corrupt Vietnam is.2 Vietnam is tied for 112 out of the 167 countries in the world with a score of 31 out of 100, with 0 being the most corrupt and 100 being the least corrupt. We can also see in previous elections and how dominant the communist party is in retaining government power over Vietnam that the country is still dealing with corrupt issues.3 We also also see from this site that goes into depth with what Vietnam does wrong as a country, when it comes to the judicial system, to the public services, Vietnam is very swayed by money.4
Parentís personal experience
19. Common laws 1.0
Laws are not equal and there is no equality for those that have money compared to those that do not in this country.1 Within an article explaining Vietnam's corruption, sent us to a PDF that had an in depth look at the PCI (Provincial competitiveness index) report of Vietnam which talks about the many briberies that it takes.23 If you wanted to look into the PDF document which is 199 pages long, link is provided below, but for the sake of our discussion if you load up the document and try and find bribery, we can see that bribery into government firms sit at roughly 55%. So with no further surprise, Vietnam will be getting a low score.
20. Central bank 1.5
Vietnamís central bank is named the State Bank of Vietnam, or ďNg‚n hŗng Nhŗ nu?c Vi?t Nam.Ē1 Is not independent of the government, but the bank does give an attempt to promote monetary growth within the country. With the purchase of 7 Billion USD in an attempt to keep the foreign exchange rate and market stable.2 This comes a few months after a speculator suggested that Vietnamís Monetary policy was too rigid and supported the highest interest rates it has had in two years.3 The State Bank does manage all commercial banks and manages to control the monetary policy effectively.4 Though the central bank does make moves to benefit the country as a whole, it does receive a low score because it is fully controlled by the government in a very ďiron-fistĒ manner.
21. Domestic budget management 1.0
Vietnamís government revenue is approximately for Vietnam at the time of 2014 is approximately 828 trillion VND.1 Vietnam has a government budget that has been in the negative for the past three years of over 140 trillion VND, meaning that the government hasnít had a budget, but it has been in a deficit, hence borrowing more.2 The government spending has been growing, but not much over revenue of the country as it sits at 265 Trillion VND.3 But due to the nature of the spending that is going on and the free trade pact is will be effect the tax revenue that Vietnam receives, we will be seeing a minimum of 1.7 Trillion VND lost annual over the next 10 years.4 (Use of the 77 million and a dollar conversion of USD to VND at a rate of 22335 thousand per 1 USD equates to 1.7 Trillion) All of this being said after analyzing three year trend gives us a very low score.
22. Government debt 1.0
We look at the Vietnamese debt ranging back from a few years, (say by the year 2013) and we can observe that Vietnam has been constantly in debt for quite a while, and this isnít due to any wars or natural disasters that Vietnam has had to borrow money to recover from any disasters.1 We see that debt has grown by over 10% over the past three years, meaning that Vietnam is only getting worse in its debt control.23 From what we can see in terms of percentages. Vietnam has had 40+ percent debt for total GDP over the past 10 years and with it only increasing, Vietnam gets a low score.
Vietnamís war and natural disaster history. http://countryeconomy.com/national-debt/vietnam
23. Economic statistics 1.0
It doesnít look like Vietnam has much statistics in terms of televisions, seeing as their only statistic dates back to 2002.1 When it comes to vehicle registration and ownership, Vietnam has a good track record in this department, that goes as far back as 2008.2 When it comes to census data for age, Vietnam is able to also keep a good track record of ages.34 The availability of this data was very easy as i was able to just google this information and within the first two searches, i was able to get this information very reliably.
24. Protection of public health and safety 1.0
By comparing alone the TB mortality rate of Vietnam(18%, varying from 12 to 25%) to say a neighboring country China(2.8%, varying from 2.7 to 2.9%) and then Thailand(11%, varying from 5.7-18%) and then to a more industrialized country such as the United Kingdom of Great Britain and Northern Ireland(0.46, varying from 0.45 to 0.46%), we can see that Vietnam has some pretty terrible TB mortality rates.1234 When we look at infant mortality, Vietnam has a mortality rate of 17% as a decreasing trend, while China has a 9%, Thailand has 11% and the UK has a 4%.5 By comparing all the local countries to the UK, we can see that Vietnam is actually very terrible, in terms of score.
25. High wage policies 1.0
Due to Vietnamís high poverty rate and poor education progress as of recent, Vietnam will still take a few more decades before it can improve on this category. As Thanh Thi Thach said, she hopes that her grandchildren will finish high school and get better jobs with sustainable incomes.1 With Vietnamís average income still being low, it is hard to imagine the Vietnamese people to have any sort of vacation, as about 25% of households still need clean water or a basic infrastructure.2 With personal experience coming from my family, where my father has 9 siblings, and of the 9, 8 of them are in poverty. None of them have ever been able to go on a vacation because they are caught up in medical bills or just trying to stay afloat with rent or mechanical bills for their motorcycle maintenance.3
Personal Experience 26. Environmental protection 1.0
Very little has been brought up in terms of environmental policies or enforcement to protect the environment. There are actually numerous issues of environmental problems that affect Vietnam, such as the Formosa Steel pollution that has killed over 100 tons of fish in Vietnam.1 This and from my parentís experience along with my own, they have told me that vehicle regulations for motorcycles, which are the main sort of transportation in Vietnam, has no regulations such as smog checks or filters that are needed to be implemented.2 This and the large population will give Vietnam a very low score, if not, one of the lowest.
2. Personal Experience/Family experience.
27. Strong army 2.4
Military expenditures come to 4.4 billion, which is 8% of the overall GDP usage.1 Vietnam has a power ranking of 17 out of 126 countries in the world and it does have military experience against the United States. Vietnam is in no legitimate agreement with any nation, and it is not a part of NATO. If Vietnam were to get into war with another country, it would be able to get a sizeable army due to its population being ďmilitary ready,Ē but from personal experience of seeing its citizens, these troops wouldnít be the most efficient at warfare.3 Though it is rated pretty highly, the military force that could be brought up immediately would be pretty poor, so it would get a moderately low score based on this.
28. Foreign trade impact 1.0
As compared to the previous numbers, how the GDP of Vietnam is 193.60 billion USD, and the net exports came to under 1 million, it is safe to say that the trade doesnít affect GDP. even if we added imports and exports together, we would still total under 1 billion and it still wouldnít total to be less than 1%.
29. Management of foreign currency budget 4.5
We will be looking at the GDP of the year of 2015 and comparing it to the numbers we currently have with exports and imports. We notice that Vietnam is doing extremely well in terms of its balance for imports and imports during this time, only being in a trade deficit by about 0.1 million USD.1 Comparing that to the GDP of Vietnam, which was 193.60 billion as of 2015, we get that Vietnam is way under 10%.2 Unfortunately, due to the history of Vietnamís trade balance, we see it doesnít stay constant, but Vietnamís balance is always going to be a small as it wouldnít even make 1 percent of the GDP.
30. Layers of collective action 1.4
The country is communist, and so any local elections are usually taken by the communist party of Vietnam and not by independents. With Vietnamís track record, of 493 elected officials and 492 of them being associated with the Communist party of Vietnam, this country receives a very low score. But it is notable that Vietnamís trend to higher family members for businesses is a note.1 As for my personal experience with this, family members are trusted on such a higher level then that of an educated person who may have a good track record, due to the corruption and deceit that is ongoing in vietnam.2
31. Pro business climate 1.0
Due to the nature of Vietnam being an underdeveloped country, a majority of the nation is in poverty. So many expectations for the kids and families is just to stay afloat. Due to the nature of such living conditions, there is very little expectation for kids to go into schooling and thus, they wonít be able to obtain such social status. Most of the business is Vietnam is in agricultural and due to being underdeveloped, wonít have much maintainance in climate.1
32. Government enterprises 1.2
With Vinatex not using as much government subsidies from moving to another location, we can see that Vinatex, the largest textile and garment company of Vietnam, is now flourishing due to its previous movement away from the main city of Hanoi.1 It does look like Vietnam is giving many Subsidiaries towards its telephone business, electricity and Multimedia businesses. (Such as Viettel, PetroVietnam (PVN), Vietnam Post and Telecommunications Group or VNPT, Vietnam Multimedia Corporation, and Vietnam Electricity.) That being said, with so many subsidies that are being given, the country receives a very low score.
33. International security agreements 3.5
Vietnam is in a strong alliance that is 20+ years strong with the United States. ďVietnam highly values and actively participates in multilateral cooperation on security issues through international and regional organizations and fora such as the UN, ASEAN, ARF, and Asia-Pacific Economic Cooperation (APEC).Ē1 Due to the fact that Vietnam is not part of NATO, Vietnam is given low remarks in terms of its treaties with other countries that are close by. In the situation that Vietnam were to go into war with say China, at best, it would have the alliance of the Philippines and its longest ally Australia.2 Due to the most recent visit by the United States and the recent hostility that China has given in being invasive, the United States would be expected to step in.
34. Protection of domestic enterprises from government mandated costs 2.3
In recent change with the new politiburo (communist policy making committee) and the recent changes with the cabinet members, Vietnam at the moment doesnít have the strongest of policies that would protect its enterprises.1 With the the semi recent changes to the Investments Las that have held since 2005, if a foreigner were to invest in Vietnam, they would turn the company into a foreign invested enterprise (FIE).2 This would exclude the company from a number of business sectors. This would also be used at liberty by the local authority and could easily be manipulated. Vietnam is run under Value Added Tax (VAT), which taxes only the end consumer for goods and services. This would mean that the multiple they could null the multiple double taxation treaties that have been formed, due to the corruptness of the party. Protection of domestic enterprises is sought as high, with exporting taxes of 0-45%(generally around 10%) with 0% coming from VAT, compared to 0-45% for importing with the additive costs from VAT and for certain goods Special Consumption Tax (SCT). Taxes on the environment, as said by the director of Vinacomin, a state-owned coal company, is said to hike up to 9 million USD for this year.3 It looks like Vietnamís environmental tax is one of the highest in the world, and for that, they are given a lower score evaluation than other countries.
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