How Vietnam has developed itself into a lucrative investment destination?

Emerging markets have been hot spots for every other global investor in recent past. Southeast Asia is the region around which economies are growing significantly and Vietnam is an epitome of development success story. The landmark political & economic reforms launched in the year 1986 have reaped the benefits for the country. They have successfully placed themselves in the middle income group category from one of the poorest in the world. Since 1986 the per capita income has increased drastically from around US$100 to around US$ 2,100 by the end of 2015.

The Socio-Economic Development Strategy (SEDS) 2011-2020 has taken care of Social security, environmental sustainability, Structural reforms & emerging issues of macroeconomic stability. The strategy also mentions three “breakthrough areas” i.e. improving market institutions, promoting human resources & skill development and infrastructure development.

Over & above the three SEDS breakthrough areas, the five year plan (the five-year Socio-Economic Development Plan 2011-2015) emphasized on three critical restructuring areas - the banking sector, state-owned enterprises and public investment -- that are needed to achieve these objectives.
The trade agreements with the European Union, Eurasian Economic Forum, South Korea & the Trans-Pacific Partnership has taken the Vietnam’s international economic presence to the next level.

GDP Growth Rate in Vietnam averaged 6.15 percent from 2000 until 2015. The Gross Domestic Product (GDP) in Vietnam expanded 7 percent in the fourth quarter of 2015 over the same quarter of the previous year. According to the World Bank’s doing business statistics, as compared to last year the ranking for Vietnam has increased on the critical parameters like Starting a Business (improved by 6 places, currently ranked as 119), Getting Electricity, (Improved by 22 places, currently ranked 108), Getting credit (improved in 8 ranks, currently ranked 8). Also the Trans Pacific Partnership (TPP) Agreement is expected to generate considerable benefits for Vietnam by giving a most to manufacturing sector. On the economic impacts, simulations suggest that the TPP could add as much as 8 percent to Vietnam’s GDP, 17 percent to its real exports, and 12 percent to its capital stock over the next 20 years. The medium-term outlook for Vietnam remains positive, and GDP growth is expected to stay at around 6.6% in 2016.