Consider the following statements:Vietnam has been one of the fastest growing economies in the world

Question

Consider the following statements:Vietnam has been one of the fastest growing economies in the world in the recent years.Vietnam is led by a multi-party political system.Vietnam's economic growth is linked to its integration with global supply chains and focus on exports.For a long time Vietnam's low labour costs and stable exchange rates have attracted global manufacturers.Vietnam has the most productive e-service sector in the Indo-Pacific region.Which of the statements given above are correct?

Accepted Answer

Vietnam is a one-party communist state, not a multi-party parliamentary democracy. Hence statement 2 is not correct.Vietnam’s open economic policy of recent years integrating into global supply chains has made the growth success story possible in recent years. Vietnam's export-led growth strategy and global integration are among the key factors behind the country's remarkable achievements in growth and poverty. Between 2002 and 2021, GDP per capita increased 3.6 times, reaching almost US$3,700. Poverty rates declined sharply from over 32 percent in 2011 to below 2 percent today. Thanks to its solid foundations, the economy has proven resilient through different crises, the latest being COVID-19. Vietnam was one of only a few countries to post GDP growth in 2020 when the pandemic hit. Vietnam is projected to be the fastest-growing internet economy in Southeast Asia in the next 10 years. Hence statements 1 and 3 are correct.Thanks to an abundance of low-wage labour, Vietnam’s manufacturing sector grew at a compound annual growth in the last decade. As the rest of East Asia developed and wages there rose, global manufacturers were lured by Vietnam's low labour costs and stable exchange rate. Hence statement 4 is correct.According to Asian Development Bank Report, e-services including digital financial services are at a very nascent stage in Vietnam. Vietnamese fintech companies raised a total of US$375 million in the first nine months of 2021, putting the country at the 3rd position in fintech investment amount across ASEAN, behind only Singapore and Indonesia. Countries like Philippines, Singapore and Indonesia are at the forefront in e-commerce productivity. Hence statement 5 is not correct.Source Attribution:BBC NewsThe EconomistWorld Bank: Vietnam Overview