Vietnam Country Profile

Snapshot of the Vietnam Country Profile


Vietnam is in a phase of transition from a centrally planned economy to a 'market economy with socialist orientation'. Vietnam's efforts to attract foreign investment have led the ruling party to seek to improve the business climate for foreign investors. This involves attempts to combat corruption which is rampant throughout the country and permeates the activities of the many state companies that still dominate the economy's strategic sectors. Yet, corruption is still cited as one of the most problematic factors for doing business in the country.

Positive developments in relation to corruption and investment:

  • Corruption has moved up on the political agenda in Vietnam, and the legal framework for curbing corruption is now well-developed.
  • Although the burden of licences and permits on private companies is still considerable, Vietnam has abolished almost 200 'unnecessary' permits for operating a company.
  • Companies indicate that special relationships with provincial authorities have declined in importance and fewer companies feel that friends are important for negotiating with government.

Risks of corruption:

  • Private providers should be particularly aware of continuing corruption related to public procurement and contracting procedures.
  • Several sources indicate that land management constitutes the most corrupt sector in Vietnam. Policies and laws on land are incoherent and have many loopholes, while supervision and enforcement of the law within land administration is fairly lax and paves the way for corruption.
  • Even though Vietnam has one of the most comprehensive Anti-Corruption Laws in Asia, lack of independent anti-corruption agencies and implementation still pose a major weakness in reducing corruption.