Since its establishment, the Communist Party of Vietnam has organized and led the society to win all the victories of the Vietnamese nation. In 1945, the Party led the people to wage the successful August Revolution, putting an end to the yoke of French colonialism and setting up the Democratic Republic of Vietnam (now the Socialist Republic of Vietnam). After leading the 9-year anti-French war of resistance to victory, the Party seized the administrative control in half of Vietnam.
Leaders of the Party, the State and the National Assembly pay tribute to President Ho Chi Minh in his mausoleum
From 1954 to 1975, the Party had led the country to carry out the construction of a new system in the North and the anti-US resistance war in the whole country, completely liberating the South in 1975 and reunifying the country in 1976. In 1986, the Communist Party of Vietnam initiated and led the renovation work and achieved a lot of great successes. After 10 years taking the country out of the economic and social crisis, embarking on the new stage of pushing ahead the national industrialization and modernization with a view to taking Vietnam to become an industrialized country in 2020.
II. THE STATE SYSTEM
1. The National Assembly
The National Assembly is the supreme representative body of the people, the highest body of State power of the Socialist Republic of Vietnam.
The National Assembly are tasked to perform the constitutional, legislative and supervisory functions and make decisions on the fundamental policies on the internal and external affairs, on the economic and social, national defense and security tasks, the main principles of the State apparatus, on the social relations and the citizens’ activities.
The term of the National Assembly is five years with two sessions a year in its activities. If the Standing Committee of the National Assembly finds it necessary or as requested by the State President, the Prime Minister of by one third of the total deputies, the National Assembly shall convene its sudden session. The deputies of the National Assembly are the Vietnamese citizens with the age of 21 and older, with good quality, qualifications and abilities and are elected by the voters.
The National Assembly deputies are tasked to attend the National Assembly sessions, are entitled to submit the law project, the ordinance project to the National Assembly, the Standing Committee of the National Assembly, are entitled to question the State President, the Chairman of the National Assembly, the Prime Minister and the Governmental ministers, the Presiding Judge of the People’s Supreme Court and the Head of the Supreme People’s Procuracy.
The National Assembly deputies must have close contact with the voters and fall under the supervision of the voters.
The Chairman and the Vice-chairmen of the National Assembly are the deputies elected by the National Assembly at the first session of every tenure of the National Assembly. The Vice-chairmen of the National Assembly are the assistants of the Chairman in accordance with the distribution of work of the Chairman.
The Standing Committee of the National Assembly, the standing body between the two sessions of the National Assembly, has the right:
- supervise the implementation of the Constitution, the law and the resolution of the National Assembly; the ordinance and the resolution of the Standing Committee of the National Assembly; to supervise the activities of the Government, the Supreme Court and the Supreme Procuracy; to promulgate the ordinance, the explanations of the Constitution, the law and the ordinance.
Two councils of the National Assembly are: the Council of the National Defense-Security chaired by the State President; the Prime Minister is the Vice-Chairman and 4 members; the Council of Nationalities comprises a Chairman and 38 members.
The Functional Committee of the National Assembly comprises the Law Committee; the Committee of Economy and Budget; the National Defense-Security Committee; the Committee of Culture, Education of Youth, Adolescents and Children; the Committee of Social Issues; the Committee of Science, Technology and Environment and the Committee of External Relations.
2. The State President
- is the head of the State, elected by the deputies of the National Assembly on behalf of the Socialist Republic of Vietnam in the internal and external relations aspects.
The Constitution of the Socialist Republic of Vietnam clearly states that the State President has 12 rights and obligations, in which the most prominent rights and obligations are:
- To make public the Constitution, law and ordinance.
- To command the people’s armed forces and hold the post of Chairman of the Council of National Defense and Security.
- To propose the National Assembly to elect or remove from the post the Vice-President, the Prime Minister, the Chief Judge of the People’s Supreme Court, the Head of the Supreme Procuracy.
Assistants of the State President are the Vice-President, the Council of National Defense and Security and the Office of the State President.
The State Vice-President is proposed by the State President and elected by the deputies of the National Assembly; the State Vice-President helps the State President to carry out the tasks and possibly is delegated by the President to do certain tasks or to work as the acting President.
The Council of the National Defense and Security is tasked to mobilize all the forces and capabilities of the country to defend the Fatherland. The Council led by the State President comprises the State Vice-President and the members introduced by the State President and approved by the National Assembly.
3. The Government
The Government is the executive body of the National Assembly, the highest administrative body of the State of the Socialist Republic of Vietnam. The Government falls under the supervision of the National Assembly and is tasked to make reports to the National Assembly, the Standing Committee of the National Assembly and the State President. The Government comprises the Prime Minister, the Deputy Prime Ministers, the Ministers and Heads of the Ministerial level agencies. The Prime Minister is introduced by the State President, elected and removed from the post by the National Assembly with a five-year term.
The Deputy Prime Ministers are proposed by the Prime Minister and approved by the National Assembly. The Deputy Prime Ministers are the assistants of the Prime Minister and are delegated with the tasks when the Prime Minister is absent.
The Ministers and Heads of the Ministerial level agencies are proposed by the Prime Minister and approved by the National Assembly. They undertake the State managerial functions for the sectors and fields assigned to them.
4. The apparatus organization at the local level
The People’s Council:
- The People’s Council in provinces and cities under the Central Government.
- The People’s Council in districts.
- The People’s Council in cities under provinces, provincial capitals and district.
- The People’s Council in communes, wards and townships.
The People’s Committee:
- Provinces and corresponding levels: it comprises departments, committees and other agencies under the People’s Committee and the Office of the People’s Committee.
- Districts and corresponding levels: it comprises departments and boards and other agencies under the People’s Committee and the Office of the People’s Committee.
- Communes and corresponding levels: the departments and offices.
III. THE FATHERLAND FRONT OF VIETNAM
The Vietnam Fatherland Front and its member organizations are the political basis of the people’s administration. The Front promotes the tradition of the entire people’s solidarity, intensifies the political and spiritual unanimity of views among the people, participates in building and consolidating the people’s administration, to together with the State take care of and protect the legitimate interests of the people, encourage the people to exercise their rights to mastery, seriously implement the Constitution and the law, supervise the activities of the State agencies, the elected representatives and the State officials and employees.
The State creates conditions for the Vietnam Fatherland Front and the member organizations to operate effectively.
IV. TRADE UNIONS
The Trade Unions is a political and social organization of the working class and of the working people. It is to together with the State agencies, the economic and social organizations take care of and protect the interests of officials and employees and other laboring people; participate in managing the State and society, in examining and supervising of the State agencies and the economic organizations; educate officials, workers, employees and other laboring people to build and protect the Fatherland.
V. OTHER POLITICAL ORGANIZATIONS
Apart from the Vietnam Fatherland Front and the Vietnam Confederation of Trade Unions, there are also a number of other political and social organizations such as the Vietnam Women’s Association, the Youth Union, the War Veterans’ Association and the Vietnam Farmers’ Association and the associations of certain occupations and crafts. These organizations play an important role in the national liberation cause. In the renovation and industrialization and modernization, these social organizations have been making an important contribution to bringing the policies of the Party and the Government of Vietnam into life.
The Economy and Society in Vietnam
Twenty years of renovation are also the twenty years when the world could be able to know the reform and renovation in Vietnam as being one of the most successful examples of the economic transfer in the contemporary history. Vietnam has recorded the extremely important, comprehensive and great achievements, step by step getting out of the economic and social crisis with the fast economic growth, the enhanced material basis and the people’s every constantly improved life.
Vietnam as being one of the most successful examples of the economic transfer in
the contemporary history.
- 1986-1990: The Gross Domestic Products (GDP) increased by 4.4% each year. The satisfactory implementation of the three-target program in food and foodstuffs, consumer goods and exports was judged as the initial success that concretize the content of socialist industrialization in the first stage. This is the stage of transferring fundamentally the old-fashioned managerial mechanism to the new managerial mechanism, carrying out a step ahead the process of renovating the economic and social life and liberating production force.
- 1991-1995: The economy had overcome the state of inertia and recession, obtaining the relatively high and comprehensive economic growth. Average annual GDP increased by 8.2%. The country had got out of the period of economic crisis and started to intensify the national industrialization and modernization.
- From 1996 to 2000: It is the important development of the new period, enhancing the national industrialization and modernization. Being affected by the political and economic crisis in the region together with the serious natural disasters, Vietnam’s economy had continuously faced with challenges. However, in this stage, Vietnam had still maintained the growth rate with GDP reaching 7% per year.
- From 2000 to 2005: The country’s economy obtained the high and continuous growth rate with GDP of 7.5% per year and growth rate of 8.4%, GDP reached VND 838 trillion and annual per capita income was put at VND 10 million, equivalent to USD 640. From a country being landed in running short of food and importing 500,000 tons to one million tons of rice every year, Vietnam became a big rice exporter in the world in this stage. In 2005, Vietnam ranked the second in the world in terms of rice export, the second in coffee, the fourth in rubber, the second in cashew nuts and the first in pepper.
- From 2000 to 2009: Vietnam entered the stage of fulfilling the Five-Year economic and social development plan (2006-2010) in a situation when there were a lot of overlapping opportunities, advantages, difficulties and challenges. On November 7, 2006, Vietnam had officially become the 150th member of the World Trade Organization (WTO).
The GDP in 2006 increased by 8.17% year on year, in which the agricultural, forestry and fisheries areas increased by 3.4%; the industrial and construction areas, by 10.37% and the services area, by 8.29%. Out of 8.17% growth rate, the agricultural, forestry and fisheries areas contributed 0.67 percentage points; the industrial and construction areas, 4.16 percentage points and the services area, 3.34% percentage points.
On the economic structure, it is to continue to transfer it in the direction of increasing the density in the industrial, construction and services areas, decreasing the density in the agricultural, forestry and fisheries areas. The density in the industrial and construction areas increased from 40.9% in 2005 to 41.52% in 2006; in the services area, from 38.01% to 38.08%, in the agricultural, forestry and fisheries area, it decreased from 21.02% to 20.40%.
The Foreign Direct Investment in 2006 continued to develop. Until December 18, 2006, there were 797 foreign investment projects nationwide being licensed with the total registered capital of USD 7.57 billion, on average, each project was valued at USD 9.5 million, 486 turns of projects increased their investment capital to USD 2.36 billion; all told, USD 9.9 billion were obtained until December 18, 2006 and it was expected to obtain USD 10 billion for the whole year of 2006, the highest ever since and the most prominent economic event in 2006.
The year 2007 was the pivotal year of the 2006-2010 Five-Year Plan. Most of the key economic fields had recorded the tops results as compared to those in 2006 and created the springboard for the following years’ more vigorous development. In 2007, GDP increased by 8.48%, meeting the National Assembly’s set targets; export turnover increased by 21.5%, higher than that set by the National Assembly; the foreign direct and indirect investment capital increased fast; the rate of poor households of the whole country reduced from 15.47% in 2006 to 14.75% in 2007. Other social fields such as education, training, health care, culture and information and sports also made great and important progress.
Vietnam’s economic and social situation in 2008 developed in the background that the world witnessed a lot of complicated and unpredictable changes with the soaring crude oil and material prices in the world’s market, bringing along the skyrocketing prices of almost all the items of goods at home; inflation happened in many countries in the world; the global financial crisis led to the recession of a number of economies and the world’s economy saw its downturn; domestically, there were a lot of natural disasters and epidemics happening continuously, affecting badly production and people’s life.
The Party and the Government had put forth in time 8 groups of solutions in order to reign in inflation, stabilize macro economy and guarantee social security and sustainable growth. GDP in accordance with the comparative price in 1994 increased approximately by 6.23% as against that in 2007, in which the agricultural, forestry and fisheries areas increased by 3.79%; the industrial and construction areas, by 6.33% and the services area, by 7.2%. Of the total growth of 6.23% of the economy, the agricultural, forestry and fisheries areas contributed 0.68 percentage points; the industrial and construction, 2.65 percentage points and the services area, 2.9 percentage points. In such a difficult situation, this was a great effort.
In 2008, there were 8 exported groups/items of goods having reached export turnover of USD 2 billion on average: crude oil, USD 10.5 billion; textile and garments, USD 9.1 billion; foot wears, USD 4.7 billion; fisheries, USD 4.6 billion; rice, USD 2.9 billion; wood work products, USD 2.8 billion; electronics and computers, USD 2.7 billion; coffee, USD 2 billion. The rate of poor households nationwide in 2008 was estimated at 13.5%, lower than the 14.8% level in 2007.
In 2009, having overcome a lot of challenges, Vietnam had recorded upbeat achievements:
1. Vietnam had soon got out of the heavy affect of the economic crisis
Vietnam’s economy had a large aperture with the world through its export turnover as well as the contribution of the flow of foreign investment capital in GDP. In early 2009, an international organization predicted that Vietnam could have a 0.3% GDP growth. However, with its reasonable and flexible policy, including the policy on the short-term interest rate support for enterprises and on the monetary easing, Vietnam not only got out of the crisis sooner than expected, but was one of a few countries in the world that had the 5.2% GDP growth as well. The flow of foreign direct and indirect investment capital continued to pour in and even of recent late, the donors had remained committed at the highest ever ODA level.
2. Rice export at record level
In 2009, Vietnam’s rice export reached 6 million tons, obtaining the record level so far, a 33% increase as against that in 2007 (4.5 million tons), a year-on-year increase of 30.4% (in 2008, it was 4.6 million tons).
3. ODA commitment surpasses USD 8 billion threshold for the first time
At the Consultative Group meeting of donors for Vietnam (CG-2009), international community committed reserving ODA for Vietnam with USD 8.063 billion in the 2010 fiscal year. This was the record commitment never seen before, especially in the background when the world’s economy met with a lot of difficulties and accessibility to sources of loans was limited.
For many years, ODA commitments for Vietnam have set continuous new records. In 2005, it was USD 3.7 billion, in 2006, it increased to USD 4.4 billion; in 2007 it was USD 5.426 billion and in 2008, it was 5.015 billion. The committed figure in 2009 exceeded all the previous records, proving that Vietnam’s economy had earned high appreciation of international community. Disbursement had also seen a lot of positive changes.
4. The financial and foreign exchange markets have seen vigorous changes
On November 25, 2009, the State Bank of Vietnam decided to increase the basic interest rate and the VND/USD exchange rate in the inter-bank market; at the same time the Government requested all the economic groups and corporations to sell foreign currency to stabilize the market. The securities market of Vietnam in 2009 had seen the rebound to the position considered as being the most vigorous growth in the world with 152.3% increase in the first 8 months of the year.
The result of the policy on monetary easing had stimulated the financial market to recover fast. The Vietnam Securities Market was judged as cheap in the region with the GDP growth of 6% in 2010.
5. Deployment across the board of the economic stimulus projects
In 2009, the Government deployed a cross the board the solutions for economic stimulus. Over 30 projects to open the airway, river way, railway, sea way and road with a value of billions of US dollars had started or stood ready for investment. This was the record investment in communication infrastructure.
Especially, the policy on socialize investment in infrastructure was reflected in a lot of the specific preferential policies, attracting capital from enterprises and individuals investing in the projects with a value of VND 10,000 billion beside the budget capital of VND 8,500 billion and the Government bonds of VND 13,000 billion.
On the other hand, for the first time, the Government issued a resolution with a lot of preferential policies to stimulate the housing market for the low income earners, students and workers in the export processing zones and the industrial parks. Investors were exempted from paying the rents of land use and land lease within the projects and were allowed to increase the building density and the coefficient of land use to 1.5 times as compared to the stipulation. Investors to build the low-price houses were supported with investment credit from the sources such as the preferential credit loan or interest rate subsidy as stipulated; the loans from the housing development fund in localities and other sources of preferential loans; were considered and supported in part or the whole of loans by the provincial People’s Committees.
It is expected that with the above-said policy, until 2015, about 60% of the students and 50% of workers in industrial parks will be provided with their accommodations.
6. The lowest rate of population growth in the past 50 years
In 2009, Vietnam reached only 1.2% of the population growth and the replacement level of 2.1 daughters over a woman. Vietnam came to the period with the lowest rate of population growth in the past 50 years. The average longevity of the Vietnamese people has become ever higher, reaching the threshold of 73 years of age. From the young population structure to the ever more aging population with the reduced birth rate and low mortality rate, Vietnam also officially entered the stage of golden population structure. From 1979 to 2008, the dependent population rate (including young children and those under 15 years of age and the old people of 60 years old and older) reduced to 53% from 98.5%. Since 2010, this rate reduced to 50% and maintained at the 46% to 48% level within 30 years.
7. The amended Law on Education approved
In 2009, the National Assembly approved the Draft Law amending and adding a number of articles of the Law on Education. The amended Law focused on settling to a definite extent a number of the current urgent issues such as the provision on universalizing the kindergarten education for children of 5 years of age; the closer provision on the compiling the universal educational program and text books; the provision on publicizing openly the criteria to control the educational quality, the authority to allow the establishment of a university, the specific stipulations on managing the activities in educational investment with foreign elements and managing the services of study abroad and the teaching programs.
The report on the Asian Development Outlook 2009 (ADO), the annual publication of ADB predicts about the economic trend in Asia, remarked that with the monetary policy continually being eased and the domestic consumption and investment being enhanced when the measures of financial stimulus affected the whole economy, Vietnam’s growth is expected to recover to the level of 6.5% in 2010.
- From 2010 to 2012: Vietnam was judged as one of the countries that would overcome the difficult stage and recover fast after the global financial crisis. GDP in 2010 was estimated at 6.78% over that in 2009, in which the first quarter saw an increase of 5.84%; the second quarter, 6.44%; the third quarter, 7.18% and the fourth quarter, 7.34%. This is a relatively high increase as compared to that of 6.31% in 2008 and much higher than that of 5.32: of 2009, surpassing the set target of 6.5%. On the general increase of 6.78% of the economy, the agricultural, forestry and fisheries areas increased by 2.78%, contributing 0.46 percentage points; the industrial and construction area, 7.7%, contributing 3.20 percentage points and the services area, 7.52%, contributing 3.11 percentage points. The aforesaid result reaffirms the correctness, timeliness, conformity and efficiency of the measures and solutions of checking the economic downturn and stabilizing macro economy with the Government’s resolute guidance to all the different levels, sectors and localities for satisfactory implementation.
GDP growth rate at constant prices in 1994
Unit: in %
Total 5.32 6.78
In accordance with economic areas
Agriculture, forestry and fisheries 1.82 2.78
Industry and construction 5.52 7.70
Services 6.63 7.52
In accordance with years
Quarter I 3.14 5.84
Quarter II 4.41 6.44
Quarter III 5.98 7.18
Quarter IV 6.99 7.34
The year 2011 is considered as the successful year of Vietnam in the situation that the economy at home and abroad was in great difficulties.
GPD in 2011 increased by 5.89%, lower than 6.78% of 2010, but it was still higher than 5.32% of 2009. Agricultural, forestry, fisheries, educational and training and health sectors had still obtained a high increase year on year. Specifically, the agricultural, forestry and fisheries areas saw a 4% increase; the industrial and construction areas, 5.53%; the services area, 6.99%. In general, the economy still maintained the reasonable growth rate.
The total export turnover was estimated at USD 96.3 billion, 33.3% more than 2010. Imported goods were valued at USD 105.8 billion, a rise of 24.7% on a year earlier. Trade deficit was put at USD 9.5 billion, 9.9% of the total export turnover, 18% lower than the set target. The State budget revenue increased by 20.6% on a year earlier and the State budget deficit was put at 4.9% of GDP, lower than the 5.3% plan. Foreign exchange reserve increased by 3.5% in the first quarter and increased by 7.5% in the third quarter.
Inflation was reigned in and macro economy was basically stabilized. CPI increased by 18.58%, obtaining the Government’s set target of 18%. It is shown through the figures that in 2011Vietnam guaranteed the job provision, social security and poverty reduction, with the unemployment rate among the working age people was 2.27% only, in which 3.6% was in the cities and 1.71% in rural areas. Consumption increased by 4.4% and the number of hungry households was reduced by 21.7% as against that in 2010.
In general, GDP growth rate in 2011 was lower than that of 2010. However, when production was in great difficulties, while the country was pooling its efforts to reign in inflation and stabilize macro economy, the above-said growth rate was relative high and reasonable. This was highly appreciated by international economic experts at the consultative meeting of donors to Vietnam in early December 2011.
As far as the reigning in inflation is concerned, there is encouraging signs. CPI in December 2011 increased by 0.53% as compared with that in 2011, much lower than the 1.36% level of 2009 and the 1.98% level of 2010.
The 2012 economic and social situation in Vietnam continues to be affected by the instability of the world’s economy due to the still unresolved financial crisis and the public debt crisis in Europe. Recession in the Euro zone together with the credit crisis and the ever increasing unemployment in the countries in this zone continues to happen. The global production and trade activities are being vigorously affected; the goods prices are developing complicatedly. The growth of the top economies is reduced, bringing along the decrease of other economies. A number of countries and the big powers block which have occupied an important position in the trade relations with Vietnam such as the US, China, Japan and EU have to face a lot of challenges, leading to the slow growth. This has made bad influence on production and business activities and life of the people in the country. The products market has been narrowed, inventories are at the high level and the people’s purchasing power has decreased. The banks’ bad debts are at the worrying level. Many enterprises, particularly the small and medium sized enterprises, have to shrink their production, stop operation or get dissolved.
In such a disadvantageous background, the Party, the National Assembly and the Government have frankly looked at and pointed to the weaknesses inside the economy, at the same time analyzed deeper the opportunities and challenges, on that basis, promulgated a lot of important documents together with the correct orientations in leadership, guidance and operation of economy and society. The 2012 overall targets determined by the Government in its Resolution No. 01 on January 03, 2012 are “to give priority to reigning in inflation, stabilizing macro economy, maintaining the growth at a reasonable level in association with the renovation of the model of growth and the restructure of the economy, to raise the quality, efficiency and competitiveness; guarantee the social welfare and security and improve the people’s life; maintain the political stability, strengthen the national defense, guarantee national security, social order and safety; to raise the efficiency of the foreign relations activities and international integration” To consolidate macro economy, remove difficulties for enterprises and boost the development of the domestic economy, the Government has promulgated the Resolution No. 13 on May 10, 2012 on a number of solutions to remove difficulties for production and business and support the market. The sectors, levels, localities and the enterprises community have in recent years made a lot of efforts, overcoming difficulties, being proactive and active in implementing synchronously the Resolution of the Party Central Committee, the Political Bureau and the National Assembly, the Resolutions of the Government and the Decision of the Governmental Prime Minister in order to maintain the economic and social stability.
GDP in 2012 at constant prices in 1994 was estimated to increase by 5.03% on the year earlier, in which the first quarter saw an increase of 4.64%; the second quarter, 4.80%; the third quarter, 5.05% and the fourth quarter, 5.44%. This year’s growth was lower than that of 5.99% of 2011, but in the situation that the world’s economy was landed in great difficulties, while the whole country was implementing the priority to reign in inflation and stabilize macro economy, this growth was reasonable and reflected the improvement trend through each quarter, reaffirming the timeliness, correctness and efficiency of the measures and solutions of the Party Central Committee, the Party, the National Assembly and the Government. In this general 5.03% growth of the entire economy, the agricultural, forestry and fisheries areas saw an increase of 2.72%, contributing 0.44 percentage points to the general growth; the industrial and construction areas, 4.52%, contributing 1.89 percentage points and the services area, 6.42%, contributing 2.7 percentage points.
GDP Growth rate at constant prices in 1994
Total 5.89 5.03
In accordance with economic areas
Agricultural, forestry, fisheries 4.01 2.72
Industrial and construction 5.53 4.52
Services 6.99 6.42
In accordance with years
Quarter I 5.53 4.64
Quarter II 5.71 4.80
Quarter III 6.02 5.05
Quarter IV 6.15 5.44