Vietnam 2011

Total score

40.32 change: 1.35

Quick facts

  • 90.55 million
Population growth:
  • 1.08 %
Unemployement rate:
  • 4.4 %
  • 276.6 billion $
GDP growth rate:
  • 6.8 %
GDP per capita:
  • 3100 $

Score and comments

Political Freedom
Free and Fair Elections

There is only one legal political party in Vietnam: The Communist Party of Vietnam (CPV), which holds all the power. There are no democratic multi-party elections, on either national or local level. Elections to the 500-member National Assembly (NA) took place in May 2011, but the CPV was the only political party legally allowed to contest. Only a handful of non-party members were allowed to run for election, of which 14 won seats. This illustrates the range of political participation and pluralism in Vietnam - there is practically none. The NA is completely controlled by the CPV, and government policy is determined by the executive branch of the party, the politburo. Taking all of this into account, Vietnam cannot be considered, even remotely, as an electoral democracy. The

most basic principle of any democratic system – free and fair elections - is not implemented.

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Absence of Unconstitutional Veto Players

There are no veto players of any kind the in the political system of Vietnam, as all power is centred in the hands of the CPV. Nevertheless, governance follows a legal-bureaucratic rule instead of a despotic one. All policies are entirely determined – directly or indirectly – by the CPV.

Freedom of Press

Freedom of the press is restricted in Vietnam; critics of the government are systematically silenced, either by court orders or by other means of harassment. Foreign journalists require a government permit to travel to places other than Hanoi. Satellite television is officially reserved to senior party officials, international hotels and foreign businesses, (although, nonetheless many homes are equipped with satellite dishes). All print media and broadcasting stations are tightly controlled by the government. Internet access is restricted through legal as well as technical means - emails with content criticising the government are banned. Also, the situation of political bloggers is rather precarious; they face long prison sentences if not even the death penalty. Reporters

Without Borders ranks Vietnam as number 165 of 178 countries, which is a slight improvement when compared to last year‘s result.

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Rule of Law
Independence of the Judiciary

Courts are only partially independent; the CPV has significant influence on the judicial branch on all levels. Lawyers are often reluctant to accept sensitive cases involving human rights or the freedom of press/speech because they fear harassment by the state. Moreover, the judicial branch, in general, lacks transparency, as well as consistency and efficiency.

Yet the situation of the courts, however deficient as they may seem, has improved during the last years. Wages have been increased and a judicial reform has done its part to improve the independence of judges.


Fighting corruption is a major challenge for the Vietnamese government. The public has become increasingly aware of this problem and discontent is growing. In 2008, the government approved of a new strategy to abolish the causes of corruption by 2020, which may be a rather ambitious goal. Moreover, Vietnam signed the UN Convention Against Corruption. Despite these positive developments, corruption remains a widespread problem in Vietnam, and many officials abuse their position for their private benefit. The Corruption Perceptions Index by Transparency International ranked Vietnam 116 out of 178 surveyed countries in 2010.

Protection of Human Rights

The protection of human rights in Vietnam is a critical issue. Human rights organisations are generally banned. Pro- democratic activists are considered to be dissidents, and risk long prison sentences. Even though the government has allowed more religious groups to freely practice their belief, there are still church groups which have not been given government sanction, and who experience discrimination and harassment. Another major issue is the death penalty: In November 2009 the Ministry of Justice proposed a motion to reduce the number of capital offences from 29 to 12; the NA rejected this proposal, claiming that the death penalty was still necessary to the prevention of widespread, serious crime. Until October 2011, executions were carried out by firing squads, with the

convict having been blindfolded and tied to a stake. A recently passed law has replaced this practise with death by lethal injection.

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Economic Freedom
Security of Property Rights

Until recently, the protection of property rights in Vietnam was rudimentary at best: Contracts were weakly enforced and dispute settlement could take years; the state had ultimate ownership of all land. In 2003, some changes were brought about by a new land law - foreigners could engage in real-estate deals, and foreign investors could lease land for 50-70 years, with renewable terms possible. Since 2009, foreigners who meet certain criteria can own apartments.

In line with Vietnam‘s bid to enter the WTO, an intellectual property law covering, among other things, copyrights and industrial property was enacted. However, intellectual property rights are often infringed and weakly enforced.

Size of Government: Expenditures, Taxes, and Enterprises

At 28.8 percent of the GDP, government expenditures are moderate. The last years saw rather slow progress in privatisation and restructure of state-owned enterprises. Tax reforms in 2009 led to a decrease of both top income and top corporate tax rates to 35 percent and 25 percent, respectively. Other taxes include a value added tax (VAT) and a tax on property transfer. The overall tax revenue equals 23.6 percent of the GDP.

Regulation of Credit, Labour, and Business

The financial sector is underdeveloped and suffers from a high degree of state involvement. Less than 20 percent of the population has a bank account. Government policy favours state-owned enterprises and determines money lending, which is done mostly by four big state-owned banks. Regulations and transparency are not in line with international standards. Some comparatively small foreign banks are allowed to operate in Vietnam. Starting, operating, and closing a business is subject to a multitude of regulations. It takes 44 days and 9 procedures to start a business. Obtaining a business license requires 13 procedures and 194 days. Bankruptcy procedures are slow and complicated. Labour regulations are inflexible. The non-salary cost of hiring a worker is moderate, but firing an

employee is difficult. Recent worker unrest has led to an increase of minimum wages.

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Freedom to Trade Internationally

Since the 1980s, the government has taken steps to liberalize trade. This process was marked by several events: Vietnam's entry into the Association of South East Asian Nations (ASEAN) in 1995; its entry into the Asia-Pacific Economic Cooperation (APEC) in 1998; the conclusion of a bilateral trade agreement with the USA in 2000, which granted Vietnam favoured nation status; and its 2007 entry into the WTO. ASEAN-membership has resulted in a sharp reduction of tariffs on imports from other member countries.

Despite these developments, international trade still suffers from import bans and restrictions on some products, import taxes and licensing requirements, opaque regulations, inadequate enforcement of intellectual property rights, corruption, and customs inconsistencies.

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