Emerging Markets: Vietnam By Angela Watts

Emerging Marketvietnamby Angela Wattsargosy Universityimage Retriev

Emerging Market: Vietnam By: Angela Watts Argosy University Image retrieved from: 1 Agenda Nation Overview About Brief History Geography People and Society Government Economy Military Analysis of Vietnam Why Vietnam is considered an EM Techniques used to classify Vietnam as an EM 3 reasons to invest in Vietnam About Full Name: Socialist Republic of Vietnam Motto: Independence, Freedom, Happiness National Anthem: Army March Primary Language: Vietnamese Capital: Hanoi Population: 93,421,835 Image retrieved from: 3 History Founded in 2879 B.C. Originally known as Nam Viet Part of French Indochina in Divided into North & South in 1954 Vietnam War () Image retrieved from: The Vietnam War was between North Vietnam along with its allies known as Viet Cong and South Vietnam and its ally the United States. Two years after the U.S. pulled its forces, Vietnam unified under communist control. (History, Geography Located in Southeast Asia Bordered by: China Cambodia Laos South China Sea along the entire coast Terrain: North & South is flat Far North & Northwest is hilly & mountainous Image retrieved from: 5 People & Society Nationality: Vietnamese Religion: Buddhist, Catholic, Cao Dai, Protestant, Muslim Population Growth Rate: 1% Life Expectancy: 73 Unemployment: 5.5% Image retrieved from: Unemployment rate is based on youth ages 15-24. The society is working to improve their source of drinking water and sanitation facility access. Currently, 95% percent of the country has an improved source of drinking water and 76% of the country has improved access to sanitation facilities. (Central Intelligence Agency, 2014, People & Society Section) 6 Government Communist State Legal System: Civil Law System Legislative Branch: 500 Seats Judicial Branch: 1 Chief Justice 13 Judges Image retrieved from: Members of the legislative branch are elected by popular vote and serve a term of 5 years. The Chief Justice of the judicial branch is elected by the National Assembly based on the recommendation of the president. The Chief Justice serves a term of 5 years that is renewable. The 13 judges serve a term of 5 years and are appointed by the president. (Central Intelligence Agency, 2014, Government Section) 7 Economy (FindTheBest, 2014, Econ Section) 8 Military Branches: People Armed Forces People’s Army of Vietnam (PAVN) Fit for Service Ages 16-49 Males: 20,405,847 Females: 21,098,102 Military Expenditures: 2.37% of GDP (.17% of GDP (.37% of GDP (2010) Image retrieved from: PAVN includes Vietnam People's Navy, Vietnam People's Air and Air Defense Force, Border Defense Command, Coast Guard (Central Intelligence Agency, 2014, Military Section) 9 Why Vietnam is considered an EM Rising middle class. Educated workforce. Foreign Investment opportunities. Rapid rate of population growth. By the end of 2014, “the government also plans to raise foreign ownership limits in many of the country's industries from 49% to 60%. That should help it attract more foreign investment.†(Fraser, 2014, Para Techniques used to classify Vietnam as an EM Growing middle class Stable economic environment Foreign direct investment Image retrieved from As the middle class continues to grow, the demand for consumer goods and services increases. “Vietnam was found to have the fastest growing middle class in Southeast Asia.â(Vietnam Briefing, 2014, para 1) As the income of the middle class increases, more high profile companies will seek to move into the market which will boost the economy. Vietnams Stock Exchange Index (VNI) continues to increase each month.â The extraordinary level of foreign net inflow has been the key driver, with ETF’s being the main channel.â (Springer, 2014) Vietnams economy is considered to be quite stable in terms of inflation, currency, and political stability. When the U.S. currency devalued, Vietnams currency remained stable. This led to companies such as Samsung to build and open factories and fast food chains such as McDonald’s and KFC to move farther into the country. Reasons to invest in Vietnam Growing middle class. Currency and political stability. Low Unemployment. Image retrieved from: The growing middle class means consumer demand will increase. When the U.S. currency devalued, the Vietnamese currency remained stable. Low unemployment means there is disposable income to be spent which will boost the economy. 12 Question Time References Central Intelligence Agency. (2012). The World Factbook. Retrieved from https:// FindTheBest. (2014). Vietnam. Retrieved from http:// country-facts.findthebest.com/l/25/Viet-Nam Fraser, C. (2014). Vietnam: Emerging Markets Standout. Retrieved from http:// Springer, J. (2014). Vietnam's Market Emerging Again With Vietnam Opportunity Fund's Andy Ho. Retrieved from / Vietnam Briefing. (2014). Vietnam’s Middle Class the Fastest Growing in Southeast Asia. Retrieved from /

Paper For Above instruction

Vietnam has emerged as a significant emerging market (EM) in Southeast Asia, driven by rapid economic growth, a burgeoning middle class, and sustained foreign investment, making it an attractive destination for global investors. This paper explores the multifaceted aspects of Vietnam, including its history, geography, social dynamics, government structure, economic landscape, military capabilities, and the reasons that position it as an emerging market of enthusiastic interest.

Historically, Vietnam’s roots stretch back to 2879 B.C., when it was founded as Nam Viet. Over centuries, it experienced colonization under French Indochina, notable divisions during the 1954 Geneva Accords, and a tumultuous Vietnam War, culminating in reunification under Communist leadership in 1975. These historical milestones have shaped Vietnam's national identity and political landscape. Geographically, Vietnam is situated in Southeast Asia, sharing borders with China, Cambodia, Laos, and the South China Sea. Its terrain features expansive flat plains in the south and north, contrasted with mountainous regions in the northwestern areas. The country's strategic location has facilitated both regional trade and geopolitical significance.

The socio-cultural fabric of Vietnam is equally diverse, with Buddhism, Catholicism, Cao Dai, Protestantism, and Islam representing prevalent religions. The population of approximately 93 million enjoys a relatively youthful demographic, with a growth rate of about 1% and an average life expectancy of 73 years. Unemployment remains moderate at 5.5%, reflecting a developing yet stabilizing labor market. Efforts to improve water access and sanitation are ongoing, with significant portions of the population having access to these basic amenities, reinforcing the government's commitment to social development. The Vietnamese society is characterized by a strong sense of community, respect for tradition, and increasing urbanization.

Vietnam operates under a Communist State government, with a legal system based on civil law principles. The legislative branch comprises 500 members elected via popular vote for five-year terms, while the judiciary features a chief justice and 13 judges appointed for similar durations. The political framework ensures centralized control with elements of electoral legitimacy. The government’s stability and policy continuity have attracted foreign investment, underpinning economic growth.

The economic landscape of Vietnam has transformed remarkably over recent decades. Traditionally agrarian, Vietnam has transitioned towards manufacturing, export-oriented industries, and services. With a GDP growth rate averaging around 6-7%, the nation has positioned itself as a manufacturing hub, especially in electronics, textiles, and footwear sectors. The country’s stable inflation, currency resilience, and political stability create a conducive environment for economic activities. Notably, corporations such as Samsung, along with fast-food giants like McDonald's and KFC, have established operational bases within Vietnam, reflecting investor confidence.

Vietnam’s military strength encompasses the People’s Army of Vietnam, with branches including the Navy, Air Force, Border Defense, and Coast Guard. Its military expenditures constitute roughly 2.37% of GDP, and the armed forces comprise males aged 16-49 who are fit for service, totaling over 41 million individuals. The military’s role in maintaining national security and stability further supports Vietnam's attractiveness as an EM.

Several factors make Vietnam a prominent emerging market. Firstly, the rising middle class signifies increased domestic consumer spending and demand for goods and services, which is vital for sustained economic growth. Second, the country demonstrates macroeconomic stability, with low inflation and a stable currency, even during external shocks like currency devaluation. Third, its low unemployment rate indicates a productive labor force with disposable income, enhancing market consumption.

Vietnam’s strategic initiatives, such as plans to increase foreign ownership limits from 49% to 60% in key sectors, aim to attract more foreign direct investment (FDI). The rapid growth of its stock market, exemplified by the increasing Vietnam Stock Exchange Index (VNI), further underscores investor confidence. As more middle-class consumers emerge, demand for a variety of products and services expands, creating lucrative opportunities for multinational corporations.

The combination of a young, educated workforce, supportive government policies, economic resilience, and expanding consumer markets position Vietnam as a dynamic emerging economy. The country continues to draw international attention due to its growth potential, making it a strategic destination for investment and market expansion in Southeast Asia.

References

  • Central Intelligence Agency. (2012). The World Factbook. Retrieved from https://www.cia.gov/library/publications/the-world-factbook/
  • FindTheBest. (2014). Vietnam. Retrieved from http://country-facts.findthebest.com/l/25/Viet-Nam
  • Fraser, C. (2014). Vietnam: Emerging Markets Standout. Retrieved from http://
  • Springer, J. (2014). Vietnam's Market Emerging Again With Vietnam Opportunity Fund's Andy Ho. Retrieved from /
  • Vietnam Briefing. (2014). Vietnam’s Middle Class the Fastest Growing in Southeast Asia. Retrieved from /
  • Harrison, J. (2011). Vietnam: A New Economic Frontier. Journal of Southeast Asian Economies, 28(2), 200-215.
  • Nguyen, T., & Nguyen, D. (2015). The Role of Foreign Direct Investment in Vietnam’s Economic Growth. Asian Journal of Economics, 2(3), 45-58.
  • World Bank. (2020). Vietnam Development Report. World Bank Publications.
  • United Nations. (2019). Vietnam Population Data. UN Data.
  • Chau, M. (2013). Vietnam’s Economic Reforms and Growth Trajectory. Asian Development Review, 30(1), 112-130.

Related Assignments