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Having attained middle-income status, Vietnam aims higher (economist.com)
134 points by velodrome on Aug 23, 2016 | hide | past | favorite | 92 comments



Having been there just last week (and every 4 years or so) the speed with which society and businesses move is breathtaking.

In my limited, sub-30-years lifetime, every single time I have visited Vietnam it seemed like visiting a different country.

The first time, there were barely any cars in an ocean of scooters and bikes. Hanoi still looked very much Parisian, with its allées and surface canalisation. I also dimly remember, there was a kind of fascination with all things Western.

The second time, construction sites were everywhere. Also, what somehow stuck out to my teenage brain was the entrance of something. Its earlier absence only became noticeable when it now appeared: Brands. Franchises. Be it milk or Vespa, or Haprosimex, they arrived. Also, entry of the heavenly air conditioners!

The third time, the streets were more congested than ever before. The middle class went to their new middle class supermarkets and demand fueled the availability of foreign goods like sausages and toast. Sill tasted like crap. Mainly because they were the American variety. Local fresh markets were seen by many Vietnamese now as 'poor people's markets' and lacking food safety.

To buy any movie or PC game, you just had to walk into one of the myriads of shops and ask for the CDs or DVD(s). if you knew the Vietnamese name, that is. Which 98% of the time, has nothing, absolutely nothing to do with its original name. With the help of my cousin, I managed to buy 'Mighty Defence of Medieval Fortresses' (Stronghold) and 'Battle of the Three Gods' (Age of Mythology) for about 3 fiddy dollars. Then we proceeded to play the shit out of them the whole summer.

This time, tourists are now relatively common. Vietnamese children (at least in HCMC and Hanoi) have gotten used to them, meaning they won't look at you like you are an Alien if you are non-Asian looking. But they'll still look at you and be very friendly.

KFC, Burger King and Popeyes have arrived.

The biggest change however is: EVERY SINGLE PERSON SEEMS TO HAVE A SMARTPHONE. And they do stuff with it. They use the shit out of it. From the 5 year old learning English on Duolingo, the 20 year old lurking Zalo or zing.vn, to the 80 year old granddad snapping pics of his orchids and mango tree - they are ALL on facebook. Thus, EVERYONE is on the internet. Unfortunately this time I didn't travel to the more remote regions, so I do not know about those. But I can imagine the network effects.

The craziest thing is, coming from a 'developed' first world country in the EU, I have to say Vietnam, and all its people are so infinitely more dynamic than most of Europe. One might say it is due to the youth of the population with the low median age, but it is more the openness of the old to technology that surprises one.

Here, many elders are exceptionally wary of the internet and privacy is hold in high regard (which I think is good!) while in VN everyone readily embraces its possibilities. It's a kind of 'use now, worry/fix later' attitude. Or actually:'use if works, y worry?'.

What does this mean for the future of Vietnam, and the region? What does it mean for Europe; stagnating, left behind, or wisefully treading carefully? in the grand schemes of things and the world? I don't know. Apologies to everyone, I didn't plan to bother you with this wall of a text, maybe the recent impressions needed to be processed desperately. So to anyone who made it this far, thanks for reading dem brain spillings, dunno what to think of it.

What I do know is though, my highest Flappy bird score was 163, and it was the cause of two exams missed.


I like HCMC. It feels very cosmopolitan and forward thinking. I think the corruption needs to be sorted out, but it's interesting that even with that there are so many western shops (apparently it was because of the previous president who opened up the country to foreign businesses?).

The canals/waters are still very polluted though but everywhere I go there is construction :).


Yeah last two weeks was my first time in HCMC and I agree, it seems very future oriented and almost 'start uppy'. I liked it a lot even though I barely got to see anything in two days, too short:(

The whole mindset is more Western and business oriented in HCMC, due the city's history as a trade centre and its connection to the US. Hanoi is more conservative, plus it is where the Politburo sits after all.


" I think the corruption needs to be sorted out,"

The 'Communism' needs to be sorted out.


Tbh VN is only Communist by name these days, plus retaining the power structure and one party system. One could even call it hyper capitalist and it would not be an overstatement. Basically China Light with certain differences.


No need to apologize for the "wall of a text". I, for one, found the comment interesting, nice capsule summary of your impressions; first read it an hour or so earlier, and seeing that it has moved up to be the top comment, looks like others found it interesting too :)


Very well said (written) and an epic way to conclude it ^^


Thanks:) I spent so much time on that game, too bad the developer then pulled it from the play store. Makes one wonder what he is up to these days^^


I was in Vietnam visiting our development centers in June, and before that I was in Nepal doing disaster relief. In both countries, I went more remote, and it baffled me how seemingly everyone under the age of 30 has a smartphone, even though they may be 7+ hours from a paved road.


So cool! So you are doing development aid in government projects or something similar? I was thinking of maybe looking into such a field after graduating, seems interesting. :)

Yep, I agree wholeheartedly. It was already baffling in the city, if you went more remote it must seem surreal at first.

But then it actually makes sense. They have smartphones out of necessity, not (mainly) to play Candy Crush and netflix.

This reminds me of part of the Refugee debate in Europe when certain people complained and mocked those 'rich' refugees seeking shelter all the while holding expensive looking smartphones.

They don't get it. For those people, their wiko/samsung sf34-235-A5r-7/huawei/Iphone8 is compass, map, navigator, encyclopedia, communication tool and bank all in one. If we were refugees or poor third world inhabitants and smart, our mobile should be the LAST thing to give up... no need for sandals when you can have a portable computer swiss knife that fits in your pocket!


How Asia Works is one of the best books I've read this year. https://www.amazon.com/dp/B00B3M47VC/

The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank. This Economist article, despite the positive tone, makes Vietnam sound more like the stalled developments in Malaysia than the success of South Korea.


It sounds like Vietnam has done a much better job of keeping politics out of private industry though. Compare with Malaysia and its blatantly racial (and often harebrained) preference schemes, which end up stifling growth and encouraging talented non-Malays to GTFO.

https://en.wikipedia.org/wiki/Bumiputera_(Malaysia)#Policy


I agree that Malaysia's racial policies are fundamentally unfair, but their GDP-per-capita (PPP) is $~27k. That's in the same ballpark as many European nations, and not monumentally different from South Korea ($34.5k). From an economic perspective, I would hardly call them a failed state.


All of the business owners I surveyed verbally in Vietnam earlier this month outlined horrific amounts of government red tape and informal facilitation payments for even the slightest bureaucratic requirements. That includes both locals and foreigners.


I find it interesting that most post-Communist societies don't ever really get rid of their Communist-era massive bureaucracies. There's never any clean-up or reform, nor any real moves to weed out corruption. Its just one day the red tape goes from centrally planned projects to capitalist projects. Often, the real red tape cutting means a culture bribes and other favors towards government officials. Russia is a pretty good example of how high-corruption and bloaty bureaucracy remains post-Communism. Businesses there just consider bribes part of their budget.


Has any country, ex-Communist or otherwise, ever been able to clean up/ tone down their bureaucracies, except the case of a total collapse?


Estonia seems to have succeeded quite well. Not totally trouble-free, but astonishingly different from Soviet times and in many areas cleaner than non-ex-Communist neighbours around Baltic sea.

A lot of this probably has to do with the fact that the Soviet bureaucracy was imposed by an occupying force that was loathed, and once that rule ended, Estonians went back to basics, something they had had before WWII and something entirely new.


I would argue that Eastern European countries did have a 'collapse' and a 'massively pivotal event' which afforded them the opportunity to toss the communists from power and start anew.

Nobody in Eastern Europe would even hint at communism these days, so many died and were oppressed ...

This is very different from Vietnam and China wherein they are 'post-Communist' countries trying to 'outgrow' their 20th century communist ideals and find a 'new way'.

I suggest both in China and Vietnam the political apparatus still believes they 'adhere to communist principles'.

Very different from East Europe.

Cultures and histories are so different it's hard to compare.

Arguably, China has had a lot of 'red tape' to deal with for a few thousand years :)


Yes the old system suffered a full bankruptcy, and indeed it is hard to compare to different cultures.

The Chinese call their system "socialist market economy" but I would call it "communistic capitalism" (communistic administration system, capitalistic economy).


I was under the impression the administration just follows thousands years old tradition of mandarins and bureaucratic administrators - nothing particularly communistic about that. Although, I'm not an expert on the subject.


I think you're right; the thousand-year-old model of administration in China actually has lots in common with real communism as it was implemented in China, and in Soviet Union. The names are different; there's no Emperor and no Mandarins but there's a General Secretary and there are party officials.


How about Latvia and Lithuania, relative to Estonia, on the same criteria?


I don't know in much detail but my impression is that the Estonians are quite a lot ahead of them in good governance. Probably one country is better in some areas and another is doing well in other types of governance.

However, Estonia is well ahead of its Baltic neighbours in e.g. Transparency International corruption ranking, and a world apart from former colonial power Russia. Compare the percentile rankings (90 % means that country is better than 90% of world):

Estonia 79%, Latvia 63 %, Lithuania 66 %

Compare to Finland 98 %, Sweden 99 %, Germany 93 %, USA 86 %, UK 90 %, China: 33 %, Russia: 13 %


East-Germany arguably doesn't count because of the impact of the reintegration with West-Germany. Excluding this, Estonia has the highest rank in the 'Doing Business' Index of a former Communist state, and Czech Republic has highest GDP/capita. Both are significantly less bureaucratic than USSR days...

https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PP...

http://www.doingbusiness.org/rankings


Arguably the USSR would be classified in the "total collapse" case though.


https://en.m.wikipedia.org/wiki/U.S._Civil_Service_Reform

I believe it was pushed though in the 19th century US by popular support. I think you also see that happening in China, albeit with the hobble of a less open media environment delaying communication of problems to those with authority.


Doing business in India still isn't easy at all, but it's definitely better than the hellhole that was the pre-1991 License Raj.


Oddly enough, Ukraine has made some big strides in that direction. It took a war, though.


Why would the bureaucracies be communist era? I think they are far older breed. E.g. hungary was part of the Austro-Hungrian empire (with the intentionallly convoluted bureauracy to play the different nationalities of the empire against one another). A lot of them were under the russian empire with it's bureaucratic legions, while the balkans were under ottoman rule (again, not the most dynamic or uncorrupt of administrations, to put it kindly).

The places that have a dynamic spirit in them, like Estonia, are special. They were a swedish domain and then under german rule with hanseatic league, thus creating tradition of good governance, before russia took over. I don't know of this explains anything, though.


Counterexamples: Latvia, Lithuania and Estonia. And most East European countries.


    > Vietnam has done a much better job of keeping 
    > politics out of private industry
Couldn't be further from the truth.


Based on the people I know from Vietnam, I'd agree. Politics is deeply entwined with private industry in Vietnam. Want to get a gov't permit? You better know someone to help you out.

Running a company that's competing with another company who has connections with the gov't? You're screwed.


The environment has been improving. I run foreign owned company in VN and we haven't had to deal with any bribery. Policies have been changed to make it easier to start a company. That's not to say things aren't still messy and inefficient; but in general the corruption isn't evenly spread throughout every industry.


It sounds, but might not be much different than Malaysians, one way or others. Vietnam don't have the thing like Great Firewall but politics make its virtual border.

http://english.vietnamnet.vn/fms/business/159912/start-up-co...


"The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank"

That can't be stressed enough.

What has been done, by the IMF and associates, in the name of "development" have caused innumerable suffering. Of course, the people responsible of those policies not only are not challenged but generously rewarded.


Will they be remembered as mass murderers I wonder ? How many people have died due to IMF policy by this point ? In Portugal alone I had to watch people go out in the street and almost starve. This was in a small Catholic town, where everyone (including myself) where constantly trying to help them. But there was just almost nothing left. I was living with my parents along with my 3 brothers, now work in London. And here it's no different. Hundreds of thousands, maybe more, are homeless and perhaps even starving. For what purpose?


Thing is, IMF "advice" that you have to take is most often given along with loan package, where the recipient country is already in shambles - typically due to policies of their own.

I see IMF as a convenient externalization of responsibility by national politicians and people who voted for them and their disastrous policies. If the bottom falls out of your country, it's not necessarily someone's nefarious plot.


Thing is, that's not true. The goal is profiting from those countries or, as in the case of Europe now, to force policies more 'pro-business' or, in other words, less 'pro-people'.

We are talking about disastrous policies imposed from the outside with, yes, normally, the compliance of a local corrupt establishment.

I recommend reading this: https://www.globalpolicy.org/component/content/article/209/4...


I beg to disagree. The advice tends to be "pro-market" and less "pro-populist" by necessity, since IMF is concerned with a living chance of seeing its money back and less so with being popular on elections in recipient country.

Then there's always that option of not taking IMF money.


"Then there's always that option of not taking IMF money."

Is there? Who have this option when the people in power is going to profit immensely.

The IMF is an institution that have expired its utility. It made sense when there was fixed exchange rate between countries.

Since then, it has mutated to an instrument to impose policies that doesn't work. That's a fact.

We could, I suppose, argue about the reason of why those policies are imposed and not others. It could be profit or it could be ideological but we can't argue about the results in contraposition to the results of countries that don't follow that development path.


>Is there? Who have this option when the people in power is going to profit immensely.

Oh but rulers do opt out taking IMF money all the time...

Zimbabwe did for the past decade.

Angola just this year did ask for IMF money and then pulled back because the conditions were not acceptable.

Half of Africa is getting into all sorts of alternative deals (China..) for the same reason.

++++ edit

And those unacceptable conditions ?

- please be less corrupt... - at least try to have some sort of checks on how the funds are spent - there are other things than building stadiums and palaces

unacceptable


> Is there? Who have this option when the people in power is going to profit immensely.

If those in power are corrupt to that extent, then the country is screwed no matter what the IMF does.


Which is the case with Portugal. But the alternatives to seek funding were far from great (e.g. China).


Portugal, as we have seen in Greece have not options.

In the case of Europe, the CEB is acting as enforcer. When you don't control your central bank you have very few options. In fact, you have surrender your sovereignty.


The Greeks are not victims. Lots of people there don't pay taxes and at the same time lots of people have government jobs. This went on for decades. That doesn't work, whether it's the Greeks, the Germans, or the IMF in charge.

As someone else said, one's economy has to be in a shambles before the need for IMF loans comes up. If you run your economy and government well, you don't need the IMF.

The IMF is a convenient scapegoat for irresponsible governments that brought on economic crises. When those governments are democratically elected year in and year out before the crisis, the fault ultimately lies with the people of the country who want to take out more than they put into the economy.

Even if the people are not venal, and simply cannot compete in an open marketplace with foreign labor and goods and therefore must depend on their governments for employment in protected industries, they must know on some level that they are living on borrowed time. Hopefully that will focus the mind and spur some people on to gain more skills. Unfortunately this latter group more often than not emigrates to other countries.

However, again as others have pointed out, post-communist societies like in east Asia and eastern Europe that have retooled their economies after profound tragedy show that it is possible to dig yourself out of a hole and catch up to the countries that never embraced collectivism. If the Chinese can rise from the ashes of the Great Leap Forward and Cultural Revolution and within two generations challenge the USA for economic supremacy, what is holding Greece and Portugal back, where things never got so bad?


Surrendering monetary sovereignty can work out as long as everyone also surrenders fiscal sovereignty, with a unified European budget. In the US, that's how states like Kentucky and Mississippi manage to survive.


If IMF has expired its utility, then the option of not taking IMF money very obviously is there and we can concentrate on some other ideas.

What might they be?


Follow the development path of Japan, South Korea etc?

Because that was what the discussion was about in this thread, or not?

I mean, why is not the IMF advising that?


Was South Korea ever in need of an IMF loan to make the ends meet? And mind you it's development path took decades through a fairly unpleasant dictatorship. Is this really better than IMF aid, do you really advocate that?


Yes. South Korea has been in need of an IMF loan.

As recently as 1997 https://www.imf.org/en/News/Articles/2015/09/28/04/53/sp0121...


To first question: actually, yes it did - in 1997, South Korea took a bailout from IMF and restructured the economy.

As you can see, it worked fairly well, though it involved some painful changes certainly disdained by many people at the time. (The dismantling of Daewoo, for instance).


Because the devellopment path used by Japan and South Korea is very close to the one used by Zaire and pre-1980 Brazil or Syria and many other places where it failed.

And in many cases, those attempts failed by the 70's


Do not assume mala fide when it is sufficient to assume that people have different opinions on how to achieve good goals.


How long have the good goals go wrong so the opinions change?

And if they not change, should I assume mala fide or craziness?

Because I have some problems with the craziness theory.


I've spent the last six years in Vietnam and the progress the country has made in that time is evident everywhere. There's been a lot of reckless development and many people have been left behind but there's no doubt there's also a growing middle and upper class. Corruption is endemic and is certainly one of the reasons Vietnam is no South Korea but it's also not the worst-run country in the region.

You know things are changing when more and more American Vietnamese are coming back to start businesses here.


The original Asian Tigers included Thailand, Malaysia, and the Philippines when they boomed in the 90s. After the '98 crises, though, none of them were able to get back on track.

There's good and bad ways to feed a boom in the short term. I hope Vietnam figures it out. I was there for a month earlier this year and it's a fantastic place.


>none of them were able to get back on track

Not sure what qualifies as back on track, but all of those economies have been growing strongly since the crisis.

Average annual GDP growth from 1999-2015: [1]

- Malaysia: 5.2%

- Thailand: 4.1%

- Philippines: 5.0%

[1] http://data.worldbank.org/


Vietnam has its ups and downs like every country but I can't think of anywhere else I'd rather live right now. Every day feels like an adventure.


Which city?


For most of that time I was in Nha Trang but moved to Da Nang earlier this year.


Singapore was an Asian Tiger, too - and it did very well. You should have included it in your list.


You're right. I specifically excluded Singapore and Hong Kong because the book I mentioned does. Something about development paths that would be hard to reproduce. Like you said, though, Singapore has succeeded where many have failed so it's interesting for sure.


Not just Singapore, but the other three too. The conventional list of Asian tigers is Hong Kong, Singapore, South Korea, and Taiwan.

https://en.wikipedia.org/wiki/Four_Asian_Tigers

Thailand, Malaysia, and the Philippines aren't in the same league.


> The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank.

Can you elaborate on this? I know nothing about either their policies or the IMF+World Bank's policies. What are they and how do they differ?


Developing countries are influenced by rich countries along the lines of https://en.wikipedia.org/wiki/Washington_Consensus.

To poorly summarize the book, the path that works is

1. Land reform to give small plots to families. This boosts yield and turns unskilled labor into foreign currency.

2. Protectionist policies balanced by government requirements to export so companies have to innovate instead of milking the local market.

3. Financial controls to prevent capital flight and make capital available to strategic industries. Often at the expense of savers.

I highly recommend this book to anyone interested in History, Economics, or Current Events.


This is exactly how Finland became developed country.

1. Land reform 1918.

2. Protectionist policies, import restrictions and increasing exports trough war reparations after WWII.

3. Strict financial controls and industrial policies. Finland ended financial controls in 80's. (Most Nordic countries ended their financial regulations in the 80's).


The interesting point in Finnish case is that the land reform was (at least nominally) a central requirement of the Red faction in the development leading to civil war in spring 1918.

The White faction won the war, and it ended in a bloodbath. with the Reds severely repressed. But the law about land reform was approved two months after the civil war ended.

Twenty years later, when Soviet Union attacked the country as Stalin believed the Reds still wanted a retribution, he faced a unified nation where the sons of Reds and Whites alike fought together, well enough to avoid occupation at the end of WWII, though the reparation payments were heavy indeed.

And then, at present day, many people say that "the land reform was the biggest mistake of the century" because it created lots of small farms instead of big, centralized agriculture.

Anyway, giving people a patch of their own land seems to be a good way to commit them to defend and work for it.


Taiwan, Japan, and South Korea were also intentionally favored by U.S. trade and industrial policy at the expense of American industry in order to develop them as a bulwark against communism

If U.S. hadn't been willing to play ball with their protectionist, export-centered industrial policies from the 1950's through the 1970's, the story could have been very different.


Despite the popular political narrative in US, protectionism was very similar in both US and Japan. Japan was just more competitive in many areas. Japan did have gradually reduced number of import quotas like everyone else. 490 quotas in 1962 and 27 in eighties.

The most-favored-nation status came trough GATT agreement 1947 and it was not US favoring other countries. It was trade agreement. Japan joined 1955.

After 1979 Tokyo Round agreement, Japan had the lowest average tariff level among industrial countries, 2.5 percent against 4.2 percent for the US.

Before 1980, most of the friction in trade was generated by U.S. industries seeking protection from Japanese imports, including textiles, steel, televisions, and automobiles. Japan solved all these cases by agreeing to to voluntarily restrain exports of the disputed items.

Japanese markets were ridiculously hard to penetrate, but often the reason was not trade barriers. Usually it was just different customer preferences and sales channels. For example, at one time US companies offered cars to sale in Japan with left-hand side steering and complained about sales.

Japanese have very protectionist agriculture policies but this seems to be universal for everyone.


The "Washington Consensus" is a rather recent term. The concept itself refers to policies that were put in place by the 70's.

The IMF and the World Bank both predate those "policies". And they were giving loans and advise before.

Truth is: they're an easy scapegoat. It's that simple.

Countries have succeded by following the IMF/WB "Neo-Liberal" advise and other countries have failed by doing the same. Countries have also succeded by not following the IMF/WB "Neo-Liberal" advise and other countries have failed by the same.

Most of the time, local politics is the real issue.


Well in the case of South Korea, adictatorship along side large government subsidies toward a few mega corporations with loans from the US/Japan was the cause.

Not necessarily what the IMF tends to like to do.


The did it by implemented a tariffs and/or implicitly subsidized their exports by buying up US treasuries (pushing the value of their currencies down).

Hong Kong/Singapore just did the latter. China, Japan, Taiwan, SK all did/do the former too.

The IMF/World Bank thinks that countries should tear down trade barriers and take on external debt, not build them up and run a current account surplus.


It's fascinating to me that "tear down trade barriers" is not part of the solution.

I generally take it as an axiom that efficient markets benefit all participants, and increasing trade barriers would seem to make the market less efficient.


Efficiency means that the total numbers go up.

Would you rather have the more efficient version where all the benefit goes to a small number of rich foreigners or the less efficient one with local distribution of benefits?


Those models don't take industrial development into account.

If you assume comparative advantage is static and a 3rd world country will always be a 3rd world country, removing trade barriers appears to be more efficient.

In the 1840s it was used to justify exporting food from Ireland while the Irish died in a famine: http://www.historyireland.com/18th-19th-century-history/food...

So it's not like this is news.


This is a very bad post hoc ergo propter hoc argument. There's no reason to believe that going against IMF advice helped. Many, many nations that did NOT industrialize also went against IMF advice. You need to show a direct connection between the two. Which you can't.


Arguments and data are in the book.


Cambodia is in a place where Vietnam was ~30 years ago, it will be interesting to see how it fares over the next 30 years.

Their GDP growth has been consistently >5% over recent years (500% in 20 years) except for 2009, and there is a lot of foreign investment coming into the country.

It's a pretty amazing place to visit, you can sense the opportunity. Capitalism is doing wonderful things for them, far better than they were under either of the communist regimes.


I'm not sure where you'd draw the line between the communist and capitalist regimes though, particularly somewhere like Cambodia with its truly remarkable web of allegiances over the last 50 years and Hun Sen in power since 1979...


Tangent. This "middle income" designation seems to have us stuck in the same rut that we were in when using "third world". It didn't initially mean 3rd place, but ended up being understood as such, and thus bestowed undeserved stereotypes. Well, byusing the term middle income we are locking ourselves into a paradigm were we are fighting to keep a middle class and take for granted the lower and upper class. We should instead be approaching the issues in a more nuanced manner, one in which we work so that no one is without their basic human needs being met and income inequality is reduced such that there is no group of 55 people that have as much wealth as the bottom 50% of global population.


According to (former) Vietnamese that visit Vietnam and have family there, South Vietnam still retains many of its pre-war capitalist culture and roots compared with the Communist North (and also compared with China).

There is also a large now successful Vietnamese Diaspora in the US and perhaps other countries that are familiar with Vietnam and might want to do business there.


It would make sense that people who worked and fought for South Vietnam were originally mostly from there.

If they then left as refugees to U.S. and now come back as investors, it's likely that they invest to the places they know and remember, i.e. the south.


A lot of the younger generation are going back (those who didn't experience the war)

https://www.youtube.com/watch?time_continue=1322&v=YbwJ6F3sI...


Thank you and it makes sense. This is a way that economic development (should) work. We are "exporting" entrepreneurs who use the skills and mindset of the US to Vietnam to help with their nascent capitalist market economy. :-)


Even though I was born and lived there for almost 20 years and coming back almost every year for the last 10 years, I really don't feel this kind of fast development described in the article. Politics really has big impact on economic development and the country has struggled as much as others within the region. It follows similar pattern like China's and it heavily got influenced by politicians who favor policies leaning toward China. Only cities like Ho Chi Minh and Ha Noi get that much of attention and heavy investments. Other parts of Vietnam is still in very poor condition. However, I really believe that it's a very good place for investment besides all the political mess because its workforce contains young/large/talented people.


Well it's only logical that the two biggest cities see development first.


I've done a lot of B2B business in Vietnam over the last year, this article does not surprise me. The people there are kind, super smart and very hard working.

I'm recently back on the market for a (software engineering) job. If anyone has any leads for a westerner to find work in Vietnam, I'd love to talk to you.


Request for clarification, this is at the end of the sixth paragraph:

  Trade accounts for roughly 150% of national output, more than any other country at its level of per-person GDP.
How can something account for more than 100% of output? Should it be 50%, or am I missing an economic term here?


If you import components worth X and export them in assemblies worth Y, the contribution to output is Y-X, whereas the contribution to trade is Y+X.

So they must be doing a lot of assembly work. For example, I believe there are no semiconductor fabs.


GDP is not the same as sales/revenue of a business.

GDP measures the value created in economy.

GDP can be calculated in different ways but they add up to the same value. GDP is sum of all gross value added and final consumption minus value of intermediate consumption. Alternatively it's the sum of primary incomes distributed by resident producer units.

If you manufacture a trinket that is sold for consumer for $100 but it costs $90 to manufacture, only $10 is added to GDP.

https://stats.oecd.org/glossary/detail.asp?ID=1163

https://stats.oecd.org/glossary/detail.asp?ID=2113


hey I liked the previous title better


Me too!




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