Vietnamese Dong - VND

Overview

The đồng has been the currency of Vietnam since May 3, 1978. It is issued by the State Bank of Vietnam. It is is represented by the symbol ₫ and subdivided into 10 hào. However, the hào is now worth so little that it is no longer issued.

Economy

• Major economic reform was undertaken in Vietnam starting in 1986. Unhappy with the lack of economic improvements post-Vietnam war, the country’s new leaders implemented reforms to shift Vietnam from a “planned economy” to a “socialist-oriented market economy”.
• Vietnam is in the process of integrating into the world economy as part of globalization. Almost all Vietnamese enterprises are SME. Vietnam has been rising as a leading agricultural exporter and an attractive foreign investment destination in Southeast Asia.
• As of April 2008, 1 US Dollar was equivalent to about 20,850 Vietnamese đồng. The relationship between the US dollar and Vietnamese đồng is important because the đồng, although not freely convertible, is loosely pegged to the Dollar through an arrangement called a crawling peg.

History

• In 1946, the Viet Minh government (later to become the government of North Vietnam) introduced their own currency, the đồng, which replaced the French Indochinese piastre at par.
• In 1953 banknotes that were denominated in both piastres and đồng were issuedfor the State of Vietnam, which evolved into South Vietnam in 1954.
• On September 22, 1975, after the fall of Saigon, the currency in South Vietnam was changed to the liberation đồng, worth 500 old southern đồng.
• The government's Second Five-Year Plan (1976–1981) set extraordinarily high goals for annual growth rates in industry, agriculture, and national income and aimed to integrate the North and the South.
• However, the plan's aims were not achieved: the economy remained dominated by small-scale production, low labor productivity, unemployment, and material and technological shortages.

General Information