The national General Statistics Office on Wednesday said gross domestic product growth accelerated to a year-on-year rate of 4.5 per cent in the second quarter from 3.1 per cent in the first.

“I believe that the worst impacts of the crisis on Vietnam are over,” Mr Ninh told the FT. “Though certain difficulties would remain in the last months of 2009, I am confident in a recovery of the economy soon.”

Nevertheless, concerned about downward market pressure on the Vietnamese currency, the dong, the State Bank of Vietnam on Wednesday announced a ban on banks charging commissions when selling US dollars, a means by which traders were effectively exchanging dong outside the official trading band of 5 per cent above or below the daily reference rate.

Although Vietnam largely escaped direct fallout from the financial crisis, it has been hit by a fall in demand in its vital export sector, which accounts for 15 to 20 per cent of GDP on a value added basis. First half exports were down 10 per cent year-on-year.

John Shrimpton of Dragon Capital in Vietnam said: “First quarter GDP growth figures seem to have represented a low. The drop-off of external demand and global recession seem to have exacerbated the situation.”

“Although the crisis has exerted negative impacts on the economy, it has also offered opportunities to Vietnam,” Mr Ninh said. “The drastic drop in exports for instance indicates that the government should increase its investment and come up with stronger incentive policies to boost the domestic market, especially in rural areas.

“This is a good opportunity for businesses to invest in fixed assets, human resources training and competitiveness enhancement to proactively foster production and business when the world economy recovers,” he said.

At the recent meeting of the National Assembly, the government downgraded its growth target for 2009 from 6.5 per cent to 5 per cent.

The government has mounted an ambitious 17,000bn dong stimulus programme to counter the effect of falling demand, concentrated on supporting industry to keep people in work with tax breaks and an interest rate subsidy of 4 percentage points for business.

Vu Thanh Tu Anh, director of research at the Fullbright School in Ho Chi Minh City, expects growth of no more than 4.5 per cent. “The stimulus package is not very efficient, but it has pumped a lot of money into the market and that has helped a little bit,” he said.

Separately, state media reported that the practising license of lawyer Le Cong Dinh, who has defended high-profile democracy activists, had been revoked by the Ho Chih Minh Bar Association, where he was once vice-chairman. Mr Dinh was arrested last month on charges of spreading propaganda against the state.

Source: The Financial Times Limited 2009 - By Tim Johnston in London and Chawadee Nualkhair in Bangkok