Industrial Growth in Vietnam

The rubber sector of Vietnam has been increasing about fifteen percent in a year. The total output of which is around 300,000 tons of dried up latex. During the year 2001 to 2010 there is a plan of investing about hundred million U.S. dollar in expanding eleven latex plants. One of the driving forces of economy has been mentioned as construction and this is growing at the rate of fifteen percent in a year. This construction sector comprises of about 3,500 companies. In this list 270 foreign invested enterprises are there that worth not less than 3.5 U.S. dollar.

Vietnam is the place where you get a large-scale wood processing industry. It has a nation-wide association of 760 state-managed wood processing units. All total 200 local enterprises are there along with nearly 1200 small scale productions and 53 joint ventures. In the year 2001 the equipment and metal work machinery was 45 U.S. dollar out of which ninety percent was imported.

The state-dominated industrial division is still noted by low productivity and inefficiency and has also slowed the growth of the private sector. The low level of development, shortages of capital, energy and transport, obsolete plants and machinery, raw materials, and a command-style economic system are regarded as the main reason behind it. Some of the Vietnam’s assets include good skill levels, low wages and a motivated work force.

In Vietnam six thousand state-owned enterprises i.e. SOEs are there and Government is the owner of those. In 1997 Vietnam government selected 88 conglomerates and organized 2000 SOEs there. In February 2003, the first auction of a SOE i.e. state-owned enterprise took place. As a result of which the sale of the Hai Phong Agricultural Mechanical Engineering Company was possible. The determined selling price was $300,000 to a private Vietnamese company. The Australian government financed the whole auction.