Bellerbys Economics - Mr Stephenson

Thursday, May 25, 2006

Vietnam economic news for our Viet students

It might be argued that one of the problems that Vietnam has is over-regulation. This can sometimes result in government failure where the cost of regulation exceeds the benefit gained. Here are some examples from today's press:

Five different inspection groups created to audit transport projects - why, five? In addition, a further team has been created to inspect the inspection teams. The Prime Minister has asked that similar teams be created to inspect irrigation projects.

A department of business licenses is to be set up to issue licenses for starting new businesses. Is this really necessary? In most countries, anyone can start a business with some restrictions on obviously difficult areas like food hygiene and so on.

However, there are many good things coming out of Vietnam at the moment so we should remain very optimistic:

Economic growth is high
Exports are likely to rise with Vietnam's WTO entry
Closer links are being established with the EU thanks to the hard work of Austria
Russia will be building Vietnam's first nuclear power station
India is exploring for oil off Vietnam's coast in partnership with Vietnam
Corruption is slowly being reduced
The Vietnamese have done an excellent job in removing bird flu from their country
Hong Kong company Hutchison is investing $655m in telecoms in Vietnam
Both Wal-Mart and Carrefour are planning to open supermarkets in Vietnam next year

All these are good signs for rapid development in the future.


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