I've travelled to Vietnam a lot over the past couple years for work and my SO's family, and there is a lot of rot in the VN economy that has finally caught up to it.
Most of the growth could be attributed to Korean, Japanese, and Chinese conglomerates spending a LOT of money moving factories from China to VN in the 2014-22 period after China started trade wars with Japan, South Korea, Taiwan, and the US.
While this lead to massive capital expenditures, the average Vietnamese person's life didn't change too drastically, as most of the investments were located in Hanoi (Chinese) or HCMC (Korean+Japanese) and only captured by the capital owning class. While there are more FMCGs and brands now, almost everything has a luxury tax on it or is imported from the US, Thailand, or South Korea, and even Temu quality clothes cost as much as they would in the US, and furthermore - rent is insanely high in HCMC and Hanoi, so 50-60% of your income is spent on rent alone.
Furthermore, party apparatchiks decided to maximize the graft they could partake in by investing heavily in boondoggle hotel and apartment projects (similar to the Ghost cities you see in China and India).
When the COVID pandemic happened, the gravy train ended.
Vietnam followed a zero-covid policy that caused migrant workers to return to their hometowns, and there was a massive corruption scandal around COVID testing infrastructure and repatriating Vietnamese migrant workers from abroad.
This was also around the time an internal conflict began brewing between the Northern VCP (supported by the VinGroup billionaire who is also from Vietnamese Military royalty), Southern VCP (supported by this billionaire), the Army (they own Vietnam's largest telco and most of the PSUs), and the Ministry of Public Security (they have the dirt on everybody and are the actual enforcers in Vietnam).
Basically, and the MPS backed the Northern faction won this round, and the Army stayed out of this fight in order to keep making money.
That said, all this upper level turmoil (under the guise of a corruption purge) dented investor confidence recently, along with some very prominent infrastructure collapses like the power outages and the internet slowdowns.
For example, this past Tet people didn't spend as much on fireworks or red money compared to the 2023 Tet, real estate projects have started slowing down, and it's not uncommon to see abandoned construction projects once you leave HCMC or Hanoi.
If you're part of the expat Bui Vien/D1/Thao Dien scene you wouldn't notice this kind of stuff (they're too busy huffing balloons/nitrous despite it being banned in VN leaving surgeons to physically restrain patients), but once you go to "real" Saigon (eg. D10, D8) let alone outside of HCMC/Hanoi/DaNang/DaLat these issues become very prominent.
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[ 3.0 ms ] story [ 16.1 ms ] threadMost of the growth could be attributed to Korean, Japanese, and Chinese conglomerates spending a LOT of money moving factories from China to VN in the 2014-22 period after China started trade wars with Japan, South Korea, Taiwan, and the US.
While this lead to massive capital expenditures, the average Vietnamese person's life didn't change too drastically, as most of the investments were located in Hanoi (Chinese) or HCMC (Korean+Japanese) and only captured by the capital owning class. While there are more FMCGs and brands now, almost everything has a luxury tax on it or is imported from the US, Thailand, or South Korea, and even Temu quality clothes cost as much as they would in the US, and furthermore - rent is insanely high in HCMC and Hanoi, so 50-60% of your income is spent on rent alone.
Furthermore, party apparatchiks decided to maximize the graft they could partake in by investing heavily in boondoggle hotel and apartment projects (similar to the Ghost cities you see in China and India).
When the COVID pandemic happened, the gravy train ended.
Vietnam followed a zero-covid policy that caused migrant workers to return to their hometowns, and there was a massive corruption scandal around COVID testing infrastructure and repatriating Vietnamese migrant workers from abroad.
This was also around the time an internal conflict began brewing between the Northern VCP (supported by the VinGroup billionaire who is also from Vietnamese Military royalty), Southern VCP (supported by this billionaire), the Army (they own Vietnam's largest telco and most of the PSUs), and the Ministry of Public Security (they have the dirt on everybody and are the actual enforcers in Vietnam).
Basically, and the MPS backed the Northern faction won this round, and the Army stayed out of this fight in order to keep making money.
That said, all this upper level turmoil (under the guise of a corruption purge) dented investor confidence recently, along with some very prominent infrastructure collapses like the power outages and the internet slowdowns.
For example, this past Tet people didn't spend as much on fireworks or red money compared to the 2023 Tet, real estate projects have started slowing down, and it's not uncommon to see abandoned construction projects once you leave HCMC or Hanoi.
If you're part of the expat Bui Vien/D1/Thao Dien scene you wouldn't notice this kind of stuff (they're too busy huffing balloons/nitrous despite it being banned in VN leaving surgeons to physically restrain patients), but once you go to "real" Saigon (eg. D10, D8) let alone outside of HCMC/Hanoi/DaNang/DaLat these issues become very prominent.
This is a fairly good overview of some of the changes I've (or moreso my SO) been noticing - https://asialink.unimelb.edu.au/insights/vietnam-the-purge