Vietnam International Political Economy

Vietnam inflation for the month of August rose 28.32 percent year over year and continues to strain the Vietnamese economy according to Daily Times.

The Vietnam inflation increase is the 10th consecutive monthly period of double digit inflation and will likely spur unrest unless the Vietnam government acts fast to quell its impact on the Vietnamese economy.

The challenge is for the Vietnamese government to balance annual growth target that competes with that of China yet maintains reasonable consumer price levels.

Tata Steel, India’s biggest steel maker, has announce a deal to invest in Vietnam $5 billion according to Hindustan Times.

The Vietnam investment is signed as a joint venture with Vietnam Steel Corporation and is expected to produce 4.5 million tons of steel and will be located in the Vung Ang Economic Zone in Ha Tinh province.

The Tate Steel joint venture investment in Vietnam is made up of a 65/30/5 percent split between Tata, Vietnam Steel and Vietnam Cement respectively.

The Vietnam government has announced it will double the Vietnam trade duty on steel exports to 20 percent according to The Economic Times.

The Vietnam trade increase by the Vietnamese government is design to limit steel exports as Vietnam relies heavily on steel imports from China. [Read more →]

With Vietnam inflation reaching an annual rate of 30 percent, the Asian Development Bank (ADB) has warned the Vietnamese government that the Vietnam economy may be on the verge of collapse according to ABC. [Read more →]

The Vietnamese government raised domestic gas prices as much as 36 percent according to BBC News.

Despite the dramatic increase, the price increase by the Vietnam government put domestic gas prices in line with the rest of Asia.

Whether the Vietnamese public with accept such an increase without protest is yet to be seen. [Read more →]

The Vietnam government’s Deputy Industry and Trade Minister announced that the government will continue to keep fuel prices stable through the year according to Forbes.

The move is in line with the Vietnam governments focus on fighting Vietnam’s inflation which currently resides in double digits.

The trouble for the Vietnamese government is that while price controls certainly help to quell public protest it still must absorb the cost while it is already running a large public deficit. [Read more →]

Vietnam Investment: Vimpelcom to Invest in Vietnam

Vimpelcom, Russia’s second largest cell phone operator, has announced it will invest in Vietnam through a joint venture according to Reuters UK.

The Vietnam investment involves a 40 percent stake worth $267 million with Vietnam state run Global Telecommunications Corporation (GTEL) with the expectation to invest $1.8 billion over the next five years.

The move by Vimpelcom to invest in Vietnam coincides with Vimpelcom investment in Cambodia’s Sotelco. See Vimpelcom to Invest in Cambodia [Read more →]

The Vietnam economy grew 6.5 percent as compared to 7.9 percent a year ago according to Reuters India.

The news of slower growth is welcome for the Vietnam government as the Vietnamese economy is currently experiencing double digit inflation and a rapidly expanding trade deficit.

The Vietnam government has reduced its [Read more →]

Vietnam inflation hit 26.8 percent in June according to Forbes.

The move accounts for a 2.1 percent increase just between May and June and continues to put a strain on the Vietnam economy and the Vietnam government in terms of what to do to keep Vietnam inflation under control to avoid all out unrest.

The likelihood of a collapse of the Vietnamese economy continues to increase yet many analysts are [Read more →]

The Vietnam government lowered its minimum price of Vietnam rice exports according to Reuters.

The move by the Vietnam government sent the price of rice down by [Read more →]

The IMF, the International Monetary Fund, announced that while it is concerned over the overheating of the Vietnam economy it believes the risk of contagion on the region is low according to The Guardian.

Slow Vietnam government policies to fight inflation, maintain a stable value of the Dong, and control over the growing Vietnam trade deficit are key concerns of the IMF’s [Read more →]

The Vietnam government has temporarily suspended the Vietnam gold imports according to Daily Times.

The Vietnam trade move comes as the Vietnam government tries to control the Vietnam trade deficit that has tripled thus far in 2008.

Typically the Vietnamese use gold or the US dollar to hedge against vietnam inflation yet with a weak US dollar [Read more →]

The Vietnam Dong fell 2 percent against the US dollar according to the Guardian.

The move comes despite the Vietnam government and the State Bank of Vietnam’s recent announcement that they would not devalue the Vietnam currency.

The consensus among analysts and economist in the region is that the Vietnam economy is on the verge of a balance of payments crisis that is likely to lead to a larger devaluation of the Vietnam currency.

Anheuser-Busch, the US based brewer, announced it would invest in Vietnam through an import and distribution agreement according to The Canadian Press.

The Vietnam investment agreement is with Gannon Distribution Co and allows Anheuser-Busch to start making Budweiser available to the Vietnam market as early as this week even though Vietnam Budweiser brewed and packaged facility in Los Angeles.

Anheuser-Busch International Inc stated that sales volume growth in the Vietnam market experienced [Read more →]

Investors service Moody’s has downgraded its ratings outlook for the Vietnam economy according to Industry Week.

The move comes just after Fitch announced a similar downgrade over concerns that the Vietnam government is not taking a tough enough stance to fight run away inflation that is inflicting the Vietnam economy.

At 25% inflation the Vietnam government is also facing [Read more →]

The Vietnam Central Bank has decided to keep the base rate for lending at 12 percent according to Reuters.

The move comes despite the fact Vietnam inflation is at 25 percent and after the Vietnam government publicly announced fighting Vietnam inflation is priority number one.

The Vietnam economy risks more strikes and protest by the Vietnamese people not to mention a total collapse of the Vietnam economy should such Vietnam government [Read more →]

Fitch Ratings has announced that its outlook for Vietnam’s debt-rating has been lowered to negative according to Bloomberg.

The key driver of Fitch’s downgrade of the Vietnam economy is the concern that the Vietnam government is not doing enough to fight inflation.

Vietnam inflation is currently at an alarming [Read more →]

The Vietnam dong continues to challenge the Vietnam economy as it feel to its lowest mark in three months according to Reuters.

The key driver of the dong decrease surrounds the offshore forwards market which priced the dong at a 30 percent depreciation on concerns over the Vietnam inflation spike.

Nonetheless, the State Bank of Vietnam only allows the dong to trade within +/- 1 percent of the official daily rate and the Vietnam government has assured the Vietnam economy that it will only allow a [Read more →]

The Vietnam economy is now experiencing 25 percent inflation as Vietnamese consumer prices sky rocketed in May according to AFP.

Key drivers of the inflation increase in the Vietnam economy include a 42 percent year over year increase in food and beverage costs with a 68 percent increase in rice alone.

The Vietnam government continues to issue warnings of [Read more →]

Asian Coast Development, a Canadian firm, plans to invest in Vietnam by building a casino in Ba Ria-Vung Tau province according to Reuters Canada.

The Vietnam investment is estimated at $4.2 billion and will include over 500 slot machines, 90 table games, and two five-star hotels equip with 2,300 rooms.

Vietnam foreign direct investment is up [Read more →]

The Vietnam government and the State Bank of Vietnam raised Vietnam interest rates according to Forbes.

The move to increase its base rate from 8.5 percent to 12 percent is aimed to combat double digit inflation as Vietnam consumer prices hit more that 21 percent in April.

Inflation is considered a top priority by the Vietnam government. [Read more →]

Alimentation Couche-Tard Inc, producer of the Circle K brand, has announced it will invest in Vietnam according to Fox News.

While the size of the Vietnam investment deal was not disclose, the deal was signed as an exclusive master franchise and license agreement with GR Vietnam International Limited through a wholly-owned subsidiary.

The move by Alimentation Couche-Tard Inc to invest in Vietnam positions the Circle K brand to compete [Read more →]

Vietnam, Thailand and Cambodia, as well as Myanmar and Laos have agreed to form a rice cartel according to Forbes.

The Vietnam trade move with its neighboring countries would act similar to OPEC but would be called the Organization of Rice Exporting Countries (OREC).

While intentions may be good considering recent runaway rice prices, it will be interesting to see how the World Trade Organization (WTO) reacts to the [Read more →]

The Vietnam government has banned rice speculation according to the International Herald Tribune.

The move comes as rice prices continue to skyrocket and cause concern over domestic supply despite that Vietnam trade of rice is second to that of the world’s leader: Thailand.

Reports suggest domestic Vietnam rice is going for as much as [Read more →]

In protest over low wages, more than 4,000 employees of Hue Phong Footwear Co went on strike according to the Houston Chronicle.

The strike comes just weeks after a large strike by Nike employees as the Vietnam economy continues to experience consumer price inflation of almost 20 percent higher that last year.

For more on strikes due to Vietnam economic concerns see: Nike Factory Shuts Down Over Strike
[Read more →]

Denmark’s Carlsberg, the number one brewer in Northern Europe, has announced it will invest in Vietnam according to Reuters.

The Vietnam investment involves a [Read more →]

The Vietnam economy has seen Vietnam rice prices rise 11 percent in just a week according to The Economic Times.

The rice price increase continues to not only put pressure on the Vietnam economy but is also challenging big rice importing countries such as the Philippines.

The double digit increase also challenges the Vietnam government charter to keep Vietnam inflation to [Read more →]

The Vietnam government is will raise automobile import taxes according to Forbes.

The move by the Vietnam government is to help reduce Vietnam’s current trade deficit which is up from $1.7 billion to $7.4 billion in just a year.

The Vietnam import tax on automobiles will rise from [Read more →]

A report by the Philippine Air Force is claiming that there is new construction on the highly disputed Spratly islands according to the Inquirer.net.

Apparently the construction is not military but possibly residential which is not a violation by the Vietnam government since the structure is located on the Pugad island which is already occupied by the Vietnam government.

The Spratly islands continue to be a controversial subject between Vietnam, China, and other surrounding Asian countries.

For more see: Vietnam Protest Over Spratly and Paracel Islands
[Read more →]

KPI, Kuwait Petroleum International, and KPC, Kuwait Petroleum Corp, with invest in Vietnam oil refining according to Reuters.

The Vietnam investment is part of a $6 billion joint venture with Petrovietnam and expected to add a second refinery to produce a capacity of 200,000 barrels daily.

The move comes after the Vietnam government recently lifted a ban on oil distribution by foreign firms as long as they sell into the Vietnam domestic market.

The move should help the Vietnam economy as an increase in [Read more →]