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In-depth discussion on the performance of the economy and provide explanations for economic results as revealed by the macroeconomic indicators.

Answer

1. Introduction

An overview of the “Vietnam’s” Economy

In spite of the fact that politically “Vietnam” is “communist-state”, it has as of late received a large portion of the elements of industrialist/business sector economies. “Vietnam” has huge prospective in Asia, evidenced by higher rate of growth; the administration has additionally attempted “investment in infrastructure”, privatization, and cutting of corporate expense rates to support “FDI”. The market of Vietnam has been developing every year at an overwhelming pace after they became an associate of the WTO since “2007”. Numerous thoughts have been raised towards keeping this sustained development path. However, have a few disadvantages to manage in the coming years. In this report, we would concentrate on examining “GDP”, unemployment rate, inflation rate factors, which would furnish us with a summary of “Vietnam's” present economic position. (Economics Research, 2011)

2. Production output performance analysis

2.1. GDP

Vietnam "GDP" Last  Previous  Highest  Lowest  Unit  
“GDP” Growth Rate 7.01  6.08  8.46  3.14  percent  (+)
“GDP” Annual Growth Rate  7.01  6.44  8.48  3.12  percent  (+)
“GDP”  186.20  171.22  186.20  6.30  USD Billion  (+)
“GDP” per capita  1077.91  1028.62  1077.91  262.95  USD  (+)s

Source: (data.worldbank.org, 2016)

Vietnam’s “GDP” Growth (Constant Prices, National Currency)  Indicator Value
2007 5.329 %
2008  6.262 %
2009  5.398 %
2010  6.423 %
2011 6.24 %
2012 5.247 %
2013  5.421 %
2014  5.5 %

Source: (www.economywatch.com, 2016)

2.2. GDP Growth Rate

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Performance of the economy

The rate of “Vietnam's “GDP”” could give us a review of our present level of wellbeing and development of the economy. The chart above demonstrates that during 2007 the “GD”” of “Vietnam” was 5.3 %, and in next 2 years there was a sharp decrease in “GDP” figures, just achieving 6.2 % and 5.3 % in 2008 and 2009 separately. Here are a couple explanations behind this:

The principal reason was because of exports. Vietnam was extremely fruitful in creating commercial enterprises for export; however, during the year of 2009 the requirement for export was fundamentally diminished. The exports of Asian nations were descended at the shocking rate since buyers in the “U.S., Europe” and different markets were bringing down on expenses (www.tradingeconomics.com(b), 2016).

The next basis was created by purchaser spending. With the increase of the joblessness rate (because of issues emerging in regions of manufacturing exports) and decreased workers' wage because of higher inflation during 2008 (22%), family units burning was chopped down (Van & Sudhipongpracha*, 2015).

The other reason was due to investment, Investment development rates in current years had come about because of money inflows of “FDI” into “Vietnam”. Yet, with the credit emergency and worldwide financial depression, capital streams were influenced extremely (Van & Sudhipongpracha*, 2015).

Performance trends of the economy

There were a few obstructions which happened in a couple of years before. When contrasted with other Asian nations, the economy of Vietnam had officially recovered and enhanced much quicker in generally of “GDP” performance before the end of 2009, and after that they are in the course of building up the economy for 2010 and the years after that. “Vietnam's GDP growth rate” is estimate to be around “6.4 %” and “6.2 % during 2010 and 2011”, as indicated by “Asian Development Bank (ADB)” in its recent report of 2010. The following years “Vietnam’s GDP rate” were; “5.2% during 2012”, “5.4% during 2013” and “5.5% in 2014”, which was high than the last two years (www.tradingeconomics.com(b), 2016). 

2.3. GDP Per Capita

“GDP” is the whole value of every “goods and services” produced in a nation (Vietnam) in a year. It is measured to be an extremely significant “indicator” of the economic strength of a nation and a positive alteration is an “indicator” of “economic” development. From “2012, the GDP per capita within Vietnam amounted to approximately 1,753 U.S. dollars”.

The GDP in the “United Kingdom” is tremendously diverse from “Vietnam”. To demonstrate this, the “United Kingdom’s GDP” is “$37,300” for each individual, while “Vietnamese's GDP” is “$4,000” for each individual (www.tradingeconomics.com(b), 2016).

Environmental damage is not included - “Gross domestic product” is a measure of merchandise and “services” created by an economy yet it is not deducted the expense of “bad” society creations like “pollution, natural resources”. In the event that a “soap or tobacco” contaminates the “air and water resources”, the estimation of “soap/tobacco” item is incorporated into “GDP” whilst the expenses of “pollution” are not taken away. The environment is specifically influenced by the monetary activities such as “industry or agricultural” division like “exhausted smoke, deforestation, contaminated air and water”, and so forth. In the event that we have a higher real “GDP”, the environmental harms, “Vietnam” couldn't anticipate to have a decent way of life.

Leisure time is not included in real GDP – “leisure time” and happiness is the things that add up to way of life however it is hard to illustrate these things through “GDP”. The time spent working is esteemed as a major aspect of “GDP”, whilst, their “leisure time” is definitely not. The additional time a nation’s individual spent on working, the higher is the “GD”P they got. Despite what might be expected, the less time they have to appreciate the life; it implies “leisure time” diminishes of a nation.

2.4. Government’s measure

During1986, “Vietnam's” “central government” initiated a nationwide restoration procedure (“Doi Moi”) with an objective of building up a “socialist-oriented market economy”. From that time, an extensive variety of strategies and plans were taken up to advance financial improvement and reconciliation with the global society. Not just did monetary liberalization in “Vietnam” triggered quick development of horticultural production, it additionally supported global trade as well as overseas investment. “Doi Moi” likewise intended for “macroeconomic” constancy (Van & Sudhipongpracha*, 2015). The measures of stabilization incorporated “inflation lessening, government spending cap, and taxation reform”. Yet the “Vietnamese” administration confronts an imperative test in controlling its expenses, especially in the wellbeing, learning, and other social administration areas. A vital measurement of the “Doi Moi” is “the decrease of the function of the state in the proprietorship and control of financial action” (www.tradingeconomics.com, 2016). 

3.1. Types of Unemployment

In financial matters, unemployment happens when individuals are without job while effectively looking for employment. The “unemployment rate” is a percentage, and computed by partitioning the numeral of unemployed people by the numeral of each and every presently employed people in the work force. The reasons, outcomes, and resolutions fluctuate in light of the particular kind of unemployment that is available inside of a nation (Dwivedi, 2010).

There are 3 essential classifications of unemployment in the economy that are normally talked about. They are “structural, frictional, and cyclical unemployment” (www.econport.org, 2006).

3.2. Unemployment trends based on unemployment rates in Vietnam

Within “Vietnam”, the “unemployment rate” measures the number of individuals effectively who are seeking for a job as a rate of the work force. “Unemployment Rate in Vietnam” diminished to “2.31%” in the “4 th quarter” of 2015 from “2.36%” in the “3 rd quarter” of 2015. “Unemployment Rate in Vietnam” arrived at an average of “2.41%” from “1998 until 2015”, achieving an untouched high of “4.50%” in the “4 th quarter” of “1998” and a recorded a lower rate of “1.81%” in the 4 th quarter of “2012”. “Unemployment Rate in Vietnam” is accounted for by the “General Statistics Office of Vietnam” (www.tradingeconomics.com(c), 2016).

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