H. Nguyen, Viet-Ha T. Nguyen, Thu-Trang Vuong, Manh-Tung Ho, Q. Vuong
{"title":"The new politics of debt in the transition economy of Vietnam","authors":"H. Nguyen, Viet-Ha T. Nguyen, Thu-Trang Vuong, Manh-Tung Ho, Q. Vuong","doi":"10.14764/10.ASEAS-0015","DOIUrl":null,"url":null,"abstract":"This study reviews the rising household debt and nonfinancial corporation debt in Vietnam, a socialist-oriented, lower middle-income emerging economy. Vietnam has made huge strides in economic growth within three decades of reforms, lifting millions of people out of poverty thanks to better access to credit. At the same time, there are lending and borrowing practices that signal troubles ahead. Based on a thorough examination of the theoretical literature on indebtedness, the study sets out to identify the drivers of borrowing and over-borrowing in Vietnam in recent years. Particularly, the abundant financial and physical resources have given rise to consumerism and the boom of the super-rich. These are two of the four factors that have shifted Vietnamese culture from one that traditionally condemned debt as a vice to one that now tolerates indebtedness. The other two factors can be found at the corporate level where there is an over-reliance on debt financing and rampant rent-seeking. Here, a kind of ‘resource curse’ threatens sustainable corporate growth – businesses rely too much on borrowing to fuel their operations, but in fact are overlooking the innovation factor. The new politics of debt, we suggest, have created a toxically pro-consumption, debt-tolerant society.","PeriodicalId":37990,"journal":{"name":"Austrian Journal of South-East Asian Studies","volume":null,"pages":null},"PeriodicalIF":0.0000,"publicationDate":"2019-06-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"9","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Austrian Journal of South-East Asian Studies","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.14764/10.ASEAS-0015","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"Social Sciences","Score":null,"Total":0}
引用次数: 9
Abstract
This study reviews the rising household debt and nonfinancial corporation debt in Vietnam, a socialist-oriented, lower middle-income emerging economy. Vietnam has made huge strides in economic growth within three decades of reforms, lifting millions of people out of poverty thanks to better access to credit. At the same time, there are lending and borrowing practices that signal troubles ahead. Based on a thorough examination of the theoretical literature on indebtedness, the study sets out to identify the drivers of borrowing and over-borrowing in Vietnam in recent years. Particularly, the abundant financial and physical resources have given rise to consumerism and the boom of the super-rich. These are two of the four factors that have shifted Vietnamese culture from one that traditionally condemned debt as a vice to one that now tolerates indebtedness. The other two factors can be found at the corporate level where there is an over-reliance on debt financing and rampant rent-seeking. Here, a kind of ‘resource curse’ threatens sustainable corporate growth – businesses rely too much on borrowing to fuel their operations, but in fact are overlooking the innovation factor. The new politics of debt, we suggest, have created a toxically pro-consumption, debt-tolerant society.
期刊介绍:
The Austrian Journal of South-East Asian Studies (ASEAS) is an international, interdisciplinary and open access social sciences journal covering a variety of topics (culture, economics, geography, politics, society) from both historical and contemporary perspectives. Topics should be related to Southeast Asia, but are not restricted to the geographical region, when spatial and political borders of Southeast Asia are crossed or transcended, e.g., in the case of linguistics, diaspora groups or forms of socio-cultural transfer. ASEAS publishes two focus issues per year and we welcome out-of-focus submissions at any time. The journal invites both established as well as young scholars to present research results and theoretical and methodical discussions, to report about on-going research projects or field studies, to publish conference reports, to conduct interviews with experts in the field, and to review relevant books. Articles can be submitted in German or English.