Vietnam has one of the fastest growing economies in Asia. Since embarking on a path of economic reform, GDP has increased from VND109.2 trillion in 1986 to VND393.0 trillion (US$24.8 billion) in 2005. Vietnam’s GDP growth in 2006 was 8.2%. Vietnam has been undergoing a transition from a centrally planned agrarian economy to a diversified market economy with growing industrial and services sectors. Vietnam produces and exports a wide range of primary commodities and manufactured goods including oil and gas, rice, coffee, aquatic products, garments, footwear, electronics and handicrafts. Tourism, telecommunications, construction, infrastructure, trade, transportation, finance and other services are increasingly contributing to the growth of the Vietnamese economy.

The participants in Vietnam’s economy can be categorized into the State, non-State, and foreign investment sectors. The overall growth in Vietnam’s GDP based on constant 1994 prices has been largely attributable to non-state sector, which contributed 44.6% to the total change in GDP at constant 1994 prices from 2000 to 2005. In the same period, the state and foreign investment sectors contributed 40.5% and 15.0% to GDP growth respectively. While increasing in absolute value terms, both State and non-State contribution to GDP at current prices decreased from 38.5% and 48.2% in 2000 to 38.4% and 45.7% in 2005, respectively. In contrast, the foreign investment sector’s contribution to GDP at current prices rose from 13.3% in 2000 to 15.9% in 2005.

Vietnam has been one of the fastest growing economies in Asia with an average GDP growth rate in excess of 8.0% per annum from 2000 to 2005. The main drivers of GDP growth over the last five years have been private consumption and investment. The Asian Development Bank expects this growth to continue with forecasted GDP growth rates of 8.0% in 2007. Furthermore, exports at current prices in 2005 increased by 138.0% over exports at current prices in 2000. This economic growth has begun to attract attention from the global media and investment community. For example, Standard & Poor’s recently upgraded the long-term foreign and local currency sovereign credit ratings of Vietnam to BB from BB- and to BB+ from BB, respectively. However, the Investment Manager  believes Vietnam’s full economic potential and considerable number of investment opportunities remain largely undiscovered.