Only a few months ago, the Socialist Republic of Vietnam was touted as the next Asian miracle, with its vrooming economy attracting billions of dollars of foreign investment, thanks to the massive economic reform program initiated by the communist government since 1986. Over the past decade, Vietnam had been a stupendous success story and an attractive investment paradise to the global investors. Its economic growth had been among the highest in the world. It had also achieved rapid growth in agricultural and industrial production, construction and housing and exports.
But in recent months, the meteoric feat of the past decade has somewhat been blurred, as the economy has been severely battered by skyrocketing inflation, a ballooning trade gap, a tanked stock market and serious worries about the currency and banking sector. In a nutshell, the economy has started showing signs of `overheating'. And now, undeniably, Vietnam is encountering the thorniest economic challenges in the post-reform era.
The history of Vietnam is replete with bloody wars, internal conflicts and political upheavals. The Southeast Asian nation had snatched independence from oppressive France in 1945 and subsequently engaged in years of bitter battles with US-sponsored forces (known as the infamous Vietnam War) which ultimately ended with the Communist Party's victory in 1975. Whatsoever, the costly Vietnam War had severely damaged the Vietnam economy, and the war-wrecked nation stood politically and ideologically disintegrated. Even the government's commanding economic policies could not expedite the post-war reconstruction program. Added to it, the trade restrictions enforced by the US and most of Europe on Vietnam after the war had exacerbated the growth prospects of the economy. |
