HO CHI MINH CITY– With average per capital annual incomes of just over US$1,000, Vietnam is officially a lower-middle income country. In Hanoi, the seat of government and commercial capital Ho Chi Minh City – still popularly known as Saigon – property prices are on an upward curve with new buildings sprouting-up faster than new growth in Vietnam’s lush tropical rainforests. But Vietnam must also address rising inflation, forecast by Standard Chartered Bank at 19.7 percent in December and with an 11.3 percent rise forecast for 2012. The Dong is expected to continue to depreciate throughout the year, given Vietnam’s US$8 billion current account deficit and low foreign currency reserves. With the State Bank of Vietnam attempting to sop up liquidity, tight monetary policy is starting to put pressure on the banking sector, with the result that some small banks have raised interest rates as high as 18 percent despite a request from the bank to keep it to 14 percent.
HO CHI MINH CITY — Late on a Tuesday evening, sitting four floors up in a Ho Chi Minh City cafe overlooking the city’s landmark opera house, a worried man who used the pseudonym Long had the look of someone who thought he was being watched. “I drove around the city for 45 minutes before heading here,” he said, hunched over and leaning forward on his seat in a restaurant that was almost empty. Looking around uneasily, he confided, “I wanted to make sure I wasn’t being followed.” At the heart of Long’s problems, and those of his fellow members of a Mennonite Church offshoot, are what they deem as unfair land seizures that see the government turn over property over to companies as land for factories and apartments. Landowners frequently complain about unfair compensation and criticize the laws on land use, which they say are often abused by corrupt local officials.