All across Asia its the same philosophy playing out.
Jobs or Inflation.
The major thing is that if we keep currencies weak to ensure exports succeed we get Inflation and jobs.In this sceanario jobs will always be there but if the workers feel not upto it(basically its not worth it) then they will just stop working(or mount go-slow movements) or get very angry leading to lot of violence .
This has already been seen all across Asia[China,India and Bangladesh are leading examples of this phenomenon playing out today]
I think corruption is everywhere.. and we should not blame corruption with the economic struggle of Vietnam. Why dont we try to understand the history of Vietnam from war and communism..maybe we can appreaciate more the progress over the year.
Based on my travel to Vietnam and the people i met their life is better now compared 10 years ago ...in short there is economic progress in their country.
Corruption is at the highest level across the globe. Asia region may be one out of many. What errupted wars in African countries today.....traceable to corruption and greed. Globally, I think each country should rise up to fight the corrupt leaders and sanitize their domain. It is high time to do "operation Sweep the corrupt leaders"
Take US for example, the leaders are aware that if you are caught in corruption and malpractices, you are done."May God bless America" The fact that such victims respect themselves and resign from public services does not stop them from being probed. That is what the Asia needs to emulate and that is what the rest of the World needs to embrace. It works.
Good point DennisQ. I personally think problems are also a matter of "size". Financial difficults are involving several countries in that regions (and abroad to be honest), but I am convinced China and India, due to their dimensions and potential political power as consequence, are in condition to find quicky alternatives faster than countries just a little smaller as Vietnam, for trying to solve (or address at least) recovery plans.
Inflation reached nearly 30 percent in 2008 and, while falling, is still at unsustainable levels.
@Marc, thanks for the post. Inflation is the problem faced by most of the Asian countries. Many countries like India, China are also facing high inflation pressure. In the end what will matter is which country handled the inflation pressure better. Challenges like inflation will help separate the men from the boys.
Marc, thanks for what I think is a pretty good summary of the current situation with Vietnam.
I agree that the enthusiasm has faded. Beyond the numerous economic difficulties you mentioned, there are many additional economic and bureaucratic-related issues which combine to make Vietnam less attractive.
The initial appeal of lower wages is enticing, but once you dig deeper it's clear that there are other rather large sacrifices and risks you'll have to take on to develop a presence in the country. For all the concerns the industry has with China, at least there are certain things that China offers that we have come to rely on. Other nations in the region have difficulty maintaining a similar degree of reliability, and in Vietnam's case, it does indeed appear that it has a long ways to go before it will be able to grow into a major player.
This is a rather unique position for Vietnam. They joined the trade organization and landed some large deals until the bottom fell out of the global economy. It seems like Vietnam is getting pelted from all sides except for their labor pool. They have issues with corruption, high inflation, and a poor credit rating. It is going to take a serious commitment from the Vietnamese government a few large respected companies to help pull this country back into the chain. Looking in from the outside it would appear there is still hope for the country, but only time will tell.
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