STATE BANK OF VIETNAM BANKING ACADEMY OF VIETNAM FACULTY OF FOREIGN LANGUAGE ---------- GRADUATION THESIS VIETNAMESE GDP IN THE PERIOD OF 2007 - 2016 Lecturer : Nguyen Phuong Lan (MA) Student : Pham Lan Huong Class : K17ATCB Student code : 17A7510070 Ha Noi, 3rd June 2018 GRADUATION THESIS ACKNOWLEDGEMENT First and foremost, I would like to express my sincere gratitude to Ms. Nguyen Phuong Lan, my supervisor, for her consecutive patience, motivation, support and immense knowledge. Her treasured instruction significantly helped me in conducting the research and writing this thesis. Without her consistent support, this thesis would not have been prosperously completed.
I would like to express the greatest appreciation to lectures of Banking Academy of Viet Nam for imparting comprehensive knowledge to me. My graduate experience deviated from subjects that the seasoned lectures organized. My sincere thanks are sent to Mr. Thai Ha Thanh, a vice director of FTC – TUNG SHING Company and the board of directors for giving me opportunity to practise.
They provided me a friendly and welcoming working environment, helpful judgments on my internship. Last but not least, I must demonstrate my deep gratefulness to my parents, my sisters and my friends for presenting me with wholehearted encouragement during my four years in the university. It was impossible to finish the thesis without their support. Pham Lan Huong – K17ATCB Page ii GRADUATION THESIS DECLARATION I declare that this thesis is the product of my own work and effort.
Where other sources of information have been used, they have been acknowledged. Signature Pham Lan Huong Pham Lan Huong – K17ATCB Page iii GRADUATION THESIS LIST OF ABBREVIATION ABBREVIATION FULL NAME WTO World Trade Organization GDP Gross Domestic Product SOEs State-owned Enterprises WEF World Economic Forum Association of Southeast Asian ASEAN Nations Association of Southeast Asian AFTA Nations Free Trade Area NA National assembly FTA Free Trade Agreement EFTA European Free Trade Association Regional Comprehensive Economic RCEP Partnership TPP Trans-Pacific Partnership Agreement US United States VAT Value added tax Pham Lan Huong – K17ATCB Page iv GRADUATION THESIS WB World Bank United Nations Millennium MDGs Development Goals HR Human Resource Pham Lan Huong – K17ATCB Page v GRADUATION THESIS TABLES OF CONTENT ACKNOWLEDGEMENT. iii LIST OF ABBREVIATION. iv TABLES OF CONTENT.
Rationale to the thesis. The scope of the study. Structural organization of the thesis. Definition of GDP.
Components of GDP. Classification of GDP. Factors affecting GDP. Non-Marketed Activities.
6 Pham Lan Huong – K17ATCB Page vi GRADUATION THESIS 4. Environmental Quality and Resource. Poverty and Economic Inequality. Limitations of measuring GDP.
GDP IN VIET NAM FROM 2007 TO 2016. GDP growth rate in the period from 2007 – 2010. GDP growth rate in the period from 2011 – 2013. GDP growth rate in the period from 2014 – 2016.
MEASURES OF THE GOVERNMENT:. The inflation rate control. Bad debts reduction. Business environment improvement.
Enhancing the quality of the labor force. Innovating the management mechanism. 34 Pham Lan Huong – K17ATCB Page vii GRADUATION THESIS TABLE OF FIGURES Figure 1: Gross domestic product in Viet Nam from 2007 to 2016. 12 Figure 2: GDP growth rate of Viet Nam in the period of 2007-2016.
13 Figure 3: GDP growth rate in quarters of Viet Nam from 2007 to 2012. 14 Figure 4: GDP growth rate of Viet Nam from 2005 to 2014. 18 Figure 5: GDP growth rate in quarters of Viet Nam from 2014 to 2017. 22 Pham Lan Huong – K17ATCB Page viii GRADUATION THESIS ABSTRACT Developing economy is the crucial target of all countries around the world, which requires a plenty of times of economists, researchers, lawmakers and governments to deal with.
In order to calculate exactly the level of economy growth, they use GDP or GDP growth rate. GDP growth rate is the most important macroeconomic indicator describing the situation of economic growth. In the world, almost no country is not interested in economic growth, because without adequate economic growth there will be no economic prosperity of the country and the improvement of people's lives. In the immediate future, the statistics industry in all countries considered GDP growth rate is the most important macroeconomic indicators to describe the situation of economic growth.
Recently, in the period of 2007 – 2016, the consequences of the crisis and banking issues have profoundly impacted on the economy in general and GDP in particular. Given the fact that unstable GDP growth rate is the most crucial concern to the government. The author expect that the topic “Vietnamese GDP in the period of 2007-2016” will help readers acknowledge of GDP trend and the government‘s attempt to improve the situation. With limited time and capacity, the author hopes to gain sincere suggestion from teachers and readers so as to complete this thesis more fully.
Pham Lan Huong – K17ATCB Page ix GRADUATION THESIS I. Rationale to the thesis In recent years, Vietnam has got important achievements in the industrialization and modernization of the country. So far, 59 countries have recognized Vietnam's economy as a market economy, including its major trading partners. Vietnam has signed 10 regional and bilateral free trade agreements (including six FTAs signed as ASEAN members, four FTAs negotiated as independent parties).
It has finalized two FTA negotiations (European Union and TPP) and actively negotiated three other FTAs (ASEAN-Hong Kong, EFTA and RCEP). However, some economic affairs, such as the galloping inflation rate, financial depression and the breakdown of real estate market, led to disequilibrium in GDP growth rate. Meanwhile GDP is an important tool of strategic economic development and macroeconomic policy objectives. With an aim to stabilize the development, the government implemented variety of policies such as demand stimulating policies and reducing bad debts policies.
Nevertheless, it is undeniable that the problem requires profound studies. Hence, gaining lessons from reality plays a vital role in proposing strategic plans for upcoming years. Arriving from factual demand, the thesis of “Vietnamese GDP in the period of 2007-2016” is carried out to deal with following issues: Definition, components and factors affecting GDP Accomplishments and constrains of the Vietnamese economy in the period of 2007-2016 Solutions that the government conducted to face the problems Recommendations for further plans Pham Lan Huong – K17ATCB Page 1 GRADUATION THESIS 2. The scope of the study The study focuses on analyzing GDP and GDP growth rate from 2007-2016.
So as to seek out the efficient solutions to enhance the rate of GDP growth, the author used a few sources of references such as websites, news and other researches. Consequently, the author endeavors to make some recommendations for government in process of improving the economy. Research methodology To have an overview of Vietnamese economy, the author has used some methods: Collecting and analyzing data and information from Ministry of Finance’s website, General Statistics Office’s website, specialist journals and other researches. Making analysis and synthesis basing on actual data.
Structural organization of the thesis Along with the introduction part, the thesis is divided into four chapters Chapter II : Background knowledge Chapter III : GDP growth rate in Viet Nam from 2007-2016 Chapter IV : Solutions of the government Chapter V : Recommendations Pham Lan Huong – K17ATCB Page 2 GRADUATION THESIS II. Definition of GDP Investopedia defines Gross domestic product (GDP) as “the monetary value of all the finished goods and services produced within a country's borders in a specific time period. Though GDP is usually calculated on an annual basis, it can be calculated on a quarterly basis as well (in the US, for example, the government releases an annualized GDP estimate for each quarter and also for an entire year). GDP includes all private and public consumption, government outlays, investments, private inventories, paid-in construction costs and the foreign balance of trade (exports are added, imports are subtracted” According to Macroeconomics (7ed) of N.
Gregory Mankiw, “GDP is often considered as the best measure of how well the economy is performing. This statistic is calculated every three months by the Bureau of Economic Analysis, a part of the U. Department of Commerce, from a huge number of fundamental data sources. The primary sources comprise both administrative data, which are byproducts of government functions such as tax collection, education programs, defense, and regulation, as well as statistical data, which comes from government surveys of, for example, retail establishments, manufacturing firms, and farm activity.
The purpose of GDP is to sum up all the figures with a single number representing the dollar value of economic activities in a given period of time”. Components of GDP Not only do Economists and policymakers focus on the economy’s total output of goods and services, but they also care about the allocation of this output among alternative uses. The national income accounts divide GDP into four broad categories of spending: Consumption (C) Pham Lan Huong – K17ATCB Page 3 GRADUATION THESIS Investment (I) Government purchases (G) Net exports (NX). Thus, letting Y stand for GDP, Y = C + I + G + NX.
GDP is the sum of consumption, investment, government purchases, and net exports. Each dollar of GDP falls into one of these categories. This equation is an identity - an equation that must hold because of the way the variables are defined. It is called the national income accounts identity.
Consumption consists of the goods and services bought by households. It is divided into three subcategories: nondurable goods, durable goods, and services. Nondurable goods are goods that last only a short time, such as food and clothing. Durable goods are goods that last a long time, such as cars and TVs.
Services include the work done for consumers by individuals and firms, such as haircuts and doctor visits. Investment consists of goods bought for future use. Investment is also divided into three subcategories: business fixed investment, residential fixed investment, and inventory investment. Business fixed investment is the purchase of new plant and equipment by firms.
Residential investment is the purchase of new housing by households and landlords. Inventory investment is the increase in firms’ inventories of goods (if inventories are falling, inventory investment is negative). Government purchases are the goods and services bought by federal, state, and local governments. This category includes such items as military equipment, highways, and the services provided by government workers.
It does not include transfer payments to individuals, such as Social Security and welfare. Because Pham Lan Huong – K17ATCB Page 4 GRADUATION THESIS transfer payments reallocate existing income and are not made in exchange for goods and services, they are not part of GDP. The last category, net exports, accounts for trade with other countries. Net exports are the value of goods and services sold to other countries (exports) minus the value of goods and services that foreigners sell us (imports).
Net exports are positive when the value of our exports is greater than the value of our imports and negative when the value of our imports is greater than the value of our exports. Net exports represent the net expenditure from abroad on our goods and services, which provides income for domestic producers. Classification of GDP 3. Real GDP Real Gross Domestic Product refers to the measure of GDP adjusted according to the general price level, in a particular financial year.
It represents the economic worth of goods and services produced, after considering inflation or deflation. Calculating real GDP measurement is done at fixed prices, i. at the prices which are prevalent at some point of time in the past, known as the base year price or reference price. It reflects the economic output at constant prices.
Real GDP is considered as a true indicator of country’s economic growth because it exclusively considers the production and free from price changes or currency fluctuations.