The year 1992/93 was fruitful in political and economic terms for Indochina. Laos and Vietnam acceded to the ASEAN Treaty of Amity and Co-operation and attained observer status in ASEAN. In Cambodia the general election was successfully held under the auspices of the United Nations Transitional Authority in Cambodia (UNTAC) in May 1993 and a new constitution was promulgated with the approval of the newly formed General Assembly in September 1993. Moreover, in July 1993, the United States lifted its objections to Vietnam's return to the International Monetary Fund by authorizing the discharge of Vietnam's debt. All these developments point to better times ahead for Indochina.

Vietnam

Overview

Vietnam's economy grew by 5.3 per cent in 1992 after the launch I of economic reforms in the last few years. Furthermore, for the I first time in its modern economic history, its balance of trade and current account did not show deficits. More remarkable was the fact that these have taken place in spite of the cessation of aid from, and a sharp fall in trade with, the former Eastern Europe and the continuing impact of the U.S. embargo.

The promising performance in 1992 was attributable to high growth in the industrial sector (15 per cent) as a result of rehabilitation and growth of the major industrial sectors after restructuring. In the agricultural sector, growth stabilized at 3 per cent with food production of 24 million tonnes, of which 1.5 million tonnes were exported. The surge in exports of rice, marine products, and crude oil contributed 26 per cent to export growth. Imports grew by more than 14 per cent during the same period. As a result of this, there was no trade deficit in 1992-93. The rapid expansion of exports along with the positive invisibles balance, including transfers, improved the current account in the balance of payments. Moreover, foreign direct investment (FDI) increased significantly, from US$1.2 billion in 1991 to US$2.0 billion in 1992.