​Vietnam’s shadow economy is bigger than you think

Vietnam’s shadow economy accounts for 25-30 percent of the country’s gross domestic product (GDP) and provides jobs for approximately 57 percent of its workforce, according to a recent study by Fulbright University Vietnam. Vietnamese Deputy Prime Minister Vuong Dinh Hue has called on the Ministry of Planning and Investment to develop a report on the country’s shadow, informal, and illegal economies. A plan to collect the related statistics is slated to be put into action later this year with the primary goal of offering a deeper insight into the size of Vietnam’s economy so that lawmakers can adopt suitable policies toward this crucial economic sector, said Do Thien Anh Tuan, an expert from the Fulbright Economics Teaching Program. The coexistence of shadow and formal economies in developing nations such as Vietnam is a long acknowledged fact of life, according to Tuan, who shared his thoughts on the issue with Tuoi Tre (Youth) newspaper in a private interview. “A common trait of underground economies is that they involve economic activities not categorized, listed, accounted, monitored, or administered by the state. In many cases, ‘shadow’ does not necessarily mean illegal,” he explained. The rise of Vietnam’s shadow economy “A sophisticated but obscure legal system is among the primary reasons why shadow economies prosper. To put it simply, people naturally find ways to dodge the law if it’s too troublesome for them to obey,” Tuan said. In a sense, he said, a shadow economy can often act as a safety net for a… [Read full story]


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