Vietnam rural financial market- Fact dianostics and the policy implications for rural development of Vietnam. The development of Vietnam rural sector has been given attention by different orientations and policy frameworks, of which rural finance is the key tool, notably the Decree 41 on cred- it for rural sector. | Journal of Economics and Development Vol. 13, 2011, pp. 57 - 73 ISSN 1859 0020 Vietnam rural financial marketFact dianostics and the policy implications for rural development of Vietnam Le Thanh Tam National Economics Univeristy, Vietnam Abstract: The development of Vietnam rural sector has been given attention by different orientations and policy frameworks, of which rural finance is the key tool, notably the Decree 41 on credit for rural sector. The Vietnam rural financial sector has been growing and making significant contribution to its rural development by a rapid expansion of outreach and available fund sources. However, there have been remaining problems that are very likely to hinder the sector from its further development. Such problems are: (1) there is a lack of responsive and adequate financial services in rural areas; (2) a significant number of the poor households still do not have access to any microfinance services, to name a few. Thus, this paper is intented to focus on two main issues. The first is to analyze the causes of such problems, and the second is to provide recommendations that are strongly expected to overcome such problems to enhance Vietnam rural development in the new decade with the Development Millenium Goal. Keywords: credit, microfinancial institutions (MFIs), poverty reduction, rural finance, savings. 1. Overview of Vietnam rural financial market the nation’s poor also lives. Agriculture accounts for 54% of the national workforce and is the economic mainstay. Therefore, the rural economy sector plays an important role in Viet Nam. However, some 80-90% of Viet Nam’s poor live in rural areas. The continued . What are the problems of Vietnam rural sector? Vietnam has approximately 72% of the population living in rural areas, where 94% of Journal of Economics and Development 57 Vol. 13, , April 2011 the seriousness of poverty, are higher among ethnic minorities. For example, of Kinh and Hoa people were
