1.

Natural Endowments:
Vietnam is seen as very vulnerable to climate change due to its large coastline. According to
World Bank research on the impact of sea-level rise on 84 coastal developing nations, a one-
meter rise in sea level can flood up to 5% of Vietnam's land area and harm 11% of the country's
population, resulting in a 10% decrease in GDP. Despite the challenges posed by climate change,
Vietnam may nevertheless profit from its excellent position and big population. However, these
advantages have yet to be adequately used in order to boost the country's competitiveness,
particularly in agriculture, tourism, and marine services. (Vietnam Competitiveness Index | 2021
Data | 2022 Forecast | 2007-2020 Historical, 2021)

Figure 01: Vietnam Competitiveness Foundations, 2021

2. Macro-Economic competitiveness:
In 2019, Vietnam was placed 92nd in the Country Competitiveness Index (CCI) 20093, or in the
70th percentile of the nations evaluated. The macroeconomic competitiveness of Vietnam is
better than that of the Philippines and Cambodia, but lower than that of the rest of ASEAN,
China, and India. Vietnam ranks 72nd on the Political Institutions rating, trailing higher-income
countries such as Thailand and India. As a result, macroeconomic policy (ranked 110th) is the
primary source of low macroeconomic competitiveness, mostly due to inflation and fiscal policy.
(Vietnam Competitiveness Index | 2021 Data | 2022 Forecast | 2007-2020 Historical, 2021)
 Figure 02: Macroeconomic competitiveness of Vietnam and Comparison countries
a. Social Infrastructure and Political Institutions
Vietnam's human development indices in the new CCI 2009 are comparable to those of
Indonesia. They are greater than in Cambodia, India, and the Philippines, but much lower than in
China (ranked 66th), Malaysia (ranked 52nd), and Thailand (ranked 70th), all of which are
developing economies seeking to escape the middle-income trap. Vietnam is experiencing a
severe shortage of high-quality human resources, which is a significant hindrance to productivity
growth. (Vũ Thành Tự Anh, 2010).
b. Rule of Law:
Vietnam's judicial system was ranked 53rd in terms of efficiency in the revised CCI 2009.
Meanwhile, policy implementation at the ministerial, sectoral, and municipal levels is
inadequate, making it hard for individuals and enterprises to fully benefit from the provisions of
the laws. Vietnam's hand is comparable to China's, which is lower but closer to the median. The
other three comparable countries that surpass the median score for all countries on the list are
Malaysia, Thailand, and South Korea. (Vũ Thành Tự Anh, 2010).
 Figure 03: Comparison ranking Vietnam and countries
3. Infrastructure investment Competitiveness:
The government has increased its investment on the North-South highway system and
refurbished inner-city roads in recent years, notably in large cities like as Hanoi and Ho Chi
Minh City. As a result, infrastructure investment in Vietnam has been enormous, accounting for
more than 10% of GDP. This is a higher proportion than Thailand and China, who now spend
between 7 and 8% of GDP, in accordance with World Bank norms. (Fulbright Economic
Teaching Program 2008, 3).
4. Monetary Competitiveness:
Credit and money supply expanded at average rates of 37% and 32%, respectively. These rates
of growth were roughly double those of China, the world's most overheated economy in the
2000s. This expansionary strategy was designed to provide for an expansionary fiscal policy
while still satisfying the investment needs of an expanding economy. The approach has the
benefit of providing a relatively high growth rate of 7.3 percent between 2010 and 2020.
(Vietnam Competitiveness Index | 2021 Data | 2022 Forecast | 2007-2020 Historical, 2021)
List of References:

Bùi Trinh (2010). “Assessment of Investment Efficiency,” unpublished monograph.

Fulbright Economics Teaching Program (2008). "Infrastructure Challenges in Vietnam."

Tradingeconomics.com. 2021. Vietnam Competitiveness Index | 2021 Data | 2022 Forecast |

2007-2020 Historical, viewed December 9, 2021.
<https://tradingeconomics.com/vietnam/competitiveness-index>

Vũ Thành Tự Anh (2010). “Vietnam’s Macroeconomy and Fiscal Policy in 2010,” presented at a
conference held by The Institute of Financial Training, Vietnam Ministry of Finance: “Financial
Policy Making in the Period of Post-crisis,” January 26, 2010. Hanoi.