Finance:Vietnamese đồng

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Short description: Currency of Vietnam
Đồng
Đồng Việt Nam (Vietnamese)
ISO 4217
CodeVND (numeric: 704)
1989–1990: VNC
Unit
PluralThe language(s) of this currency do(es) not have a morphological plural distinction.
Symbol₫/đ‎
Denominations
Superunit
 10³nghìn (thousand)
 10⁶triệu (million)
 10⁹tỷ (billion)
Subunit
 ​1⁄10hào
 ​1⁄100xu
both subunits are obsolete due to inflation and have been unused in Vietnam for several decades
Banknotes
 Freq. used1,000, 2,000, 5,000, 10,000, 20,000, 50,000, 100,000, 200,000, 500,000 dong
Demographics
User(s) Vietnam
Issuance
Central bankState Bank of Vietnam
 Websitewww.sbv.gov.vn
Valuation
InflationPositive decrease 2.7% (2019)[1]

The dong (Vietnamese: đồng, Chữ Nôm: 銅) (/dɒŋ/; Vietnamese: [ˀɗɜwŋ͡m˨˩]; sign: ₫ or informally đ in Vietnamese;[2] code: VND) has been the currency of Vietnam since 3 May 1978.[3][4] It is issued by the State Bank of Vietnam.[5] The dong was also the currency of the predecessor states of North Vietnam and South Vietnam, having replaced the previously used French Indochinese piastre.[6][7]

Formerly, it was subdivided into 10 hao (hào), which were further subdivided into 10 xu, neither of which are now used due to inflation. The Vietnamese dong has increasingly moved towards exclusively using banknotes, with lower denominations printed on paper and denominations over 10,000 dong, worth about 40¢ dollar or euro, printed on polymer. As of 2022, no coins are used. Generally, Vietnam is moving towards digital payments.[8][9][10] The 500,000-dong note (VND) is the highest-denomination banknote in circulation in Vietnam. The note is dark blue in color and has been in circulation since 2003.[11][12][13][14]

As of October 2023, the Vietnamese dong was the second-lowest valued currency unit (behind the Iranian rial), with one United States dollar equaling 24,385 dong.[15]

History

French Indochina

The piastre (known in Vietnam as "silver"), was the currency of French Indochina between 1885 and 1952.

North Vietnam

In 1946, the Viet Minh government (later to become the government of North Vietnam) introduced its own currency, the dong, to replace the French Indochinese piastre at par. Two revaluations followed, in 1951 and 1959; the first was at a rate of 100:1, the second at a rate of 1,000:1.

South Vietnam

South Vietnam 500 dong banknote issued in 1966.

Notes dually denominated in piastres and dong were issued in 1953 for the State of Vietnam, which evolved into South Vietnam in 1954. On 22 September 1975, after the fall of Saigon, the currency in South Vietnam was changed to a "liberation dong" worth 500 old Southern dong.

United Vietnam and inflation

After Vietnam was reunified, the dong was also unified on 3 May 1978. One new dong equalled one Northern dong or 0.8 Southern "liberation" dong.

On 14 September 1985, the dong was revalued again, with one new dong worth 10 old dong. At that time, Vietnamese economists believed that revaluing the currency would increase its value, but it turned out to have the opposite effect: savings of many people were wiped out, the currency experienced unprecedently heavy inflation that peaked at 774.7% in 1986 and prices skyrocketed. For example, in 1986, the price of agricultural products increased by 2000% compared to ten years before. To aggravate this problem, the government banned all forms of non-state-owned internal trade, which they believed to be capitalistic, resulting in an economic crisis so severe that Tố Hữu referred to it as a "vertical downturn". Despite the inflation rates having stabilised as part of the Đổi Mới reforms, especially during the 1990s and early 2000s, the effects of the crisis still last in the value of the dong, one of the lowest in the world today.[16]

Coins

First dong

In 1978, aluminium coins dated 1976 were introduced in denominations of 1, 2 and 5 hao, as well as 1 dong. The coins were minted by the Berlin Mint in the German Democratic Republic and bear the state crest on the obverse and denomination on the reverse. Due to the chronic inflation experienced by Vietnam during the 1980s and 1990s, these coins lost all their relevant value and no coins were circulated for many years after this series.

1976 Series
Image Value Technical parameters Description Date of
Diameter Thickness Mass Composition Edge Obverse Reverse First minting Issue Issue suspended Withdrawal
1 hao Unknown Aluminum Reeded Coat of arms Denomination 1976 May 2, 1978 September 14, 1985
2 hao
5 hao
1 dong

Second dong

Commemorative issues

Commemorative coins in copper, brass, copper-nickel, silver, and gold have been issued since 1986, but none of these have ever been used in circulation.

2003 issue

The State Bank of Vietnam resumed issuing coins on December 17, 2003.[17] The new coins, minted by the Mint of Finland, were in denominations of 200, 500, 1,000, 2,000, and 5,000 dong in either nickel-clad steel or brass-clad steel. Prior to its reintroduction, Vietnamese consumers had to exchange banknotes for tokens with a clerk before purchasing goods from vending machines. This was also to help the state ease the cost of producing large quantities of small denomination banknotes, which tended to wear easily. Many residents expressed excitement at seeing coins reappear after many years, as well as concern for the limited usefulness of the 200 dong coins due to ongoing inflationary pressures.[18]

Since the launch of the 2003 coin series, the State Bank has had some difficulties with making the acceptance of coins universal despite the partial discontinuation of smaller notes, to the point of some banks refusing coin cash deposits or the cashing in of large numbers of coins. This has prompted laws requiring private and municipal banks to transact and offer services for coins and the full discontinuation of small denomination and cotton-based notes. Also, the coins did not gain popularity from the Vietnamese people.[19] Eventually, State Bank of Vietnam withdrew its distribution in April 2011.[20][21]

2003 Series[17]
Image Value Technical parameters Description Date of
Diameter Thickness Mass Composition Edge Obverse Reverse first minting issue Issue suspended Withdrawal [22][23] 200 dong 20 mm 1.45 mm 3.2 g Nickel-plated steel Plain Coat of arms Denomination 2003 December 17, 2003 April 2011 Very rare, partly withdrawn out of circulation 500 dong 22 mm 1.75 mm 4.5 g Nickel-plated steel Segmented (3 groups) April 1, 2004 [24][25] 1,000 dong 19 mm 1.95 mm 3.8 g Brass-plated steel Reeded Coat of arms Water Temple, Đô Temple 2003 December 17, 2003 April 2011 Very rare, partly withdrawn out of circulation [26][27] 2,000 dong 23.5 mm 1.8 mm 5.1 g Brass-plated steel Segmented (6 groups) Highland Stilt house in Tay Nguyen April 1, 2004 5,000 dong 25.5 mm 2.2 mm 7.7 g Brass (Cu92Al6Ni2) Micro-scalloped Một Cột Pagoda (One Pillar Pagoda) December 17, 2003

Banknotes

First dong

In 1978, the State Bank of Vietnam (Ngân hàng Nhà nước Việt Nam) introduced notes in denominations of 5 hao, 1, 5, 10, 20, and 50 dong dated 1976. In 1980, 2 and 10 dong notes were added, followed by 30 and 100 dong notes in 1981. These notes were discontinued in 1985 as they gradually lost value due to inflation and economic instability.

First dong (1978-1981)
Image Value Dimensions Main Color Description Date of
Obverse Reverse printing issue Issue suspended withdrawal
5 hao 107 × 53 mm Purple-Brown Coat of Arms Coconut palm 1976 2 May 1978 September 14, 1985
1 dong 115 × 57 mm Brown Thai Nguyen Iron and Steel Corporation
2 dong 115 × 58 mm Purple River Scene 1980 1980
5 dong 123 × 61 mm Green Fishery 1976 2 May 1978
10 dong 131 × 63 mm Purple-Blue Elephant, logging
131 × 65 mm Purple Ho Chi Minh house 1980 1980
20 dong 141 × 70 mm Blue Ho Chi Minh Tractors, hydroelectric dam 1976 2 May 1978
30 dong 143 × 71 mm Red-Brown Freighters; "Dragon's House" (Nha Rong), Ho Chi Minh museum, Saigon 1981 1981
50 dong 151 × 75 mm Red Hong Gai open pit mining 1976 2 May 1978
100 dong 158 × 80 mm Brown-Yellow Ha Long Bay 1980 1980

Second dong

In 1985, notes were introduced in denominations of 5 hao, 1, 2, 5, 10, 20, 30, 50, 100, and 500 dong. As inflation became endemic, these first banknotes were followed by 200, 1,000, 2,000, and 5,000 dong notes in 1987, by 10,000 and 50,000 dong notes in 1990, by a 20,000 dong note in 1991, a 100,000 dong note in 1994, a 500,000 dong note in 2003, and a 200,000 dong note in 2006. Banknotes with denominations of 5,000 dong and under have been discontinued from production, but as of 2015 are still in wide circulation.[28]

Five banknote series have appeared. Except for the current series, dated 2003, all were confusing to the user, lacking unified themes and coordination in their designs. The first table below shows the latest banknotes, of 100 dong or higher, prior to the current series. On 7 June 2007, the government ordered cessation of the issuance of the cotton 50,000 and 100,000 dong notes.[citation needed] They were taken out of circulation by 1 September 2007. State Bank of Vietnam 10,000 and 20,000 dong cotton notes are no longer in circulation as of 1 January 2013.[29]

Second dong (1985)
Image Value Dimensions Main Color Description Date of
Obverse Reverse printing issue issue suspended withdrawal
5 hao 100 × 50 mm Pink Flag Tower of Hanoi Denomination 1985 14 September 1985 Unknown
1 dong 114 × 57 mm Blue-Green Hòn Phụ Tử (Father and Son islet)
2 dong 110 × 56 mm Purple Boats
5 dong 128 × 64 mm Green Boats in Hue
10 dong Red Ngoc Son Temple
20 dong Purple Ho Chi Minh One Pillar pagoda
30 dong 150 × 75 mm Blue Ben Thanh Market
50 dong Green Thac Ba hydro power plant
149 × 75 mm Pink Thang Long bridge 1987
100 dong 158 × 78 mm Brown Rice planting 14 September 1985
500 dong Red Bim Son cement plant

Third dong

Second dong (1987-2000) [17]
Image Value Dimensions Main Color Description Date of
Obverse Reverse printing issue issue suspended withdrawal
100 đồng 120 × 60 mm Green Coat of Arms Phổ Minh Temple 1991 2 May 1992 1994 Current, but rarely use
200 dong 130 × 65 mm Orange Ho Chi Minh Agricultural production 1987 30 September 1987 2015
500 dong Pink Port Haiphong 1988 15 August 1989
1,000 dong 134 × 65 mm Brown-Green Coal Mining 1987 2 March 1988 20 October 1989
2,000 dong Brown-Pink Thai Nguyen Iron and Steel Corporation
1,000 dong Green Lumber productions 1988 20 October 1989 2015 Current
2,000 dong Pink Textile factory
5,000 dong Blue Offshore platform 1987 2 March 1988 15 January 1993
Trị An hydropower plant 1991 15 January 1993 2015 Current
10,000 dong 140 × 68 mm Red Hạ Long Bay 1990 2 May 1992 1994 1 January 2013
1993 15 October 1994 2006
20,000 dong Blue Canned food factory 1991 2 March 1993
50,000 dong Green Nhà Rồng Port 1990 1994 1 September 2007
1994 15 October 1994 2003
100,000 dong 145 × 71 mm Brown Ho Chi Minh's ethnic house 1 September 2000 2004

In 2003 Vietnam began replacing its cotton banknotes with plastic polymer banknotes, claiming that this would reduce the cost of printing.[30] Many newspapers in the country criticized these changes, citing mistakes in printing and alleging that the son of the governor of the State Bank of Vietnam benefited from printing contracts.[30] The government clamped down on these criticisms by banning two newspapers from publishing for a month and considering other sanctions against other newspapers.[30] Even though the 2003 series banknotes listed in the table below have now completely replaced the old notes of the same denominations, as of 2019 the cotton fibre banknotes of 200, 500, 1,000, 2,000, and 5,000 dong still remain in wide circulation and are universally accepted.[citation needed]

2003 Polymer Series[17][31]
Image Value Dimensions Main Color Description Date of
Obverse Reverse Obverse Reverse printing issue issue suspended Withdrawal
10,000 dong 132 × 60 mm Yellow Ho Chi Minh Bạch Hổ oil field The first two digits of the serial number give the last two digits of the year of issue. 30 August 2006 Current
20,000 dong 136 × 65 mm Blue Covered bridge in Hội An 17 May 2006
50,000 dong 140 × 65 mm Pink Huế 17 December 2003
100,000 dong 144 × 65 mm Green Temple of Literature 1 September 2004
200,000 dong 148 × 65 mm Red Hạ Long Bay 30 August 2006
500,000 dong 152 × 65 mm Cyan Ho Chi Minh's birthplace in Kim Liên 17 December 2003

A commemorative polymer 50 dong banknote dedicated to the fiftieth anniversary of the State Bank of Vietnam was issued in 2001, but its face value is so tiny that it clearly was meant only for collectors. The note is available in three forms, by itself, in a presentation folder or in a presentation folder in an envelope. In 2016, a 100 dong banknote was issued on cotton-based paper to commemorate the 65th anniversary of central banking.

Commemorative notes
Image Value Dimensions Main Color Materials Description Date of
Obverse Reverse printing issue
50 dong 165 × 82 mm Pink Polymer Ho Chi Minh State Bank of Vietnam 2001 May 2001
100 dong 163 × 82 mm Red Paper 2016 6 May 2016

Bearer's checks 1992–2002

To support the growing industrial need for large money transactions, the State Bank issued "Bearer's Checks" or "State Bank Settlement Checks" (Ngân Phiếu Thanh Toán) in denominations from 100,000 to 5,000,000 dong.[32] To prevent counterfeiting, these notes had many degrees of protection, their designs were changed every five to six months, and they had expiration dates five or six months after the date of issue. The checks worked until the banking system was upgraded to handle electronic transfers of large amounts of đồng, making most large cash transactions unnecessary.

Other uses of dong

In the Vietnamese language, đồng can be used as a generic term for any currency by adding the name of a country as a qualifier. This practice is more common for more esoteric units of currency.

Exchange rate

After the revaluation of the Zimbabwean dollar on 1 August 2006,[33] the dong became the least valued currency unit for months. Around 21 March 2007, the revalued Zimbabwean dollar regained least valued currency status (in terms of black market exchange rate), and on 7 September 2007 in terms of official exchange rate. After the use of the Zimbabwean dollar ceased on 12 April 2009,[34] the dong was the second least valued currency unit after the Iranian rial as of 28 November 2014. Since 19 June 2014, the Vietnamese dong has been devalued a total of five times in an effort to help spur exports and to ensure the stability of the currency.[35]

Year USD Exchange rate
1960 97
1970 410
1980 2,050
1990 6,500
2000 14,428
2010 19,495
2020 23,173
2022 22,862

(Sources: tradingeconomics.com, imf.org)

See also

References

  1. ↑ "Vietnam and the IMF". https://www.imf.org/en/Countries/VNM. 
  2. ↑ The State Bank of Vietnam suggests other languages use the ISO code "SBV - Tasks and Mandates of SBV". https://www.sbv.gov.vn/webcenter/portal/en/home/sbv/bac/tamosbv?_afrLoop=64647645848599234#%40%3F_afrLoop%3D64647645848599234%26centerWidth%3D80%2525%26leftWidth%3D20%2525%26rightWidth%3D0%2525%26showFooter%3Dfalse%26showHeader%3Dfalse%26_adf.ctrl-state%3Df3jb1hwbs_103. 
  3. ↑ (in en) World Currency Yearbook. International Currency Analysis, Incorporated. 1990. https://books.google.com/books?id=x1ESAQAAMAAJ&q=VND+3+May+1978.. Retrieved 26 December 2023. 
  4. ↑ (in vi) Kinh tế Việt Nam 1955-2000: tính toán mới, phân tích mới. Nhà xuất bản Thống Kê. 2000. https://books.google.com/books?id=FqzsAAAAMAAJ&q=VND+3+th%C3%A1ng+5+n%C4%83m+1978.. Retrieved 26 December 2023. 
  5. ↑ "TIỀN ĐANG LƯU HÀNH". https://www.sbv.gov.vn/webcenter/portal/vi/menu/trangchu/pht/dtvn/tdlh?_afrLoop=39126466391830466#%40%3F_afrLoop%3D39126466391830466%26centerWidth%3D80%2525%26leftWidth%3D20%2525%26rightWidth%3D0%2525%26showFooter%3Dfalse%26showHeader%3Dfalse%26_adf.ctrl-state%3Deac1zmkof_4. 
  6. ↑ "History of the Joint Chiefs of Staff". https://www.jcs.mil/Portals/36/Documents/History/Vietnam/Vietnam_1947-1954.pdf. 
  7. ↑ "Tiền và hoạt động tiền tệ tại Việt Nam trước năm 1945". https://journalofscience.ou.edu.vn/index.php/econ-vi/article/download/1140/923. 
  8. ↑ Hàng, Thời Báo Ngân (2021-04-28). "Lịch sử đồng tiền Việt Nam - Quá trình hình thành và phát triển" (in vi). https://thoibaonganhang.vn/lich-su-dong-tien-viet-nam-qua-trinh-hinh-thanh-va-phat-trien-114031.html. 
  9. ↑ VTV, BAO DIEN TU (2021-05-04). "Lịch sử đồng tiền Việt Nam" (in vi). https://vtv.vn/news-20210504205442487.htm. 
  10. ↑ Khánh, Vĩnh (2022-06-12). "Tiền tệ Việt Nam thời Pháp thuộc" (in vi). https://kinhtedothi.vn/tien-te-viet-nam-thoi-phap-thuoc.html. 
  11. ↑ NLD.COM.VN. "17-12, phát hành tiền giấy 500.000 đồng và 50.000 đồng mới" (in vi). https://nld.com.vn/thoi-su-trong-nuoc/17-12--phat-hanh-tien-giay-500000-dong-va-50000-dong-moi-72832.htm. 
  12. ↑ VnExpress. "Việt Nam sắp có tiền nhựa và tiền xu" (in vi). https://vnexpress.net/viet-nam-sap-co-tien-nhua-va-tien-xu-2675365.html. 
  13. ↑ Nam, Nguyen. "Tỷ giá euro" (in vi). https://chogia.vn/ngoai-te/eur/. 
  14. ↑ ONLINE, TUOI TRE (2003-11-27). "Từ 17-12-2003: VN có thêm 5 loại tiền mặt mới" (in vi). https://tuoitre.vn/tu-17-12-2003-vn-co-them-5-loai-tien-mat-moi-10568.htm. 
  15. ↑ VietnamFinance (2016-05-02). "Bản đồ tiền tệ: giá trị Việt Nam đồng thấp thứ 2 thế giới" (in vi). https://vietnamfinance.vn/ban-do-tien-te-gia-tri-tien-viet-thap-thu-2-the-gioi-20160428235738083.htm. 
  16. ↑ "LOC Country Study Vietnam.". Lcweb2.loc.gov. http://lcweb2.loc.gov/cgi-bin/query/r?frd/cstdy:@field(DOCID+vn0091). 
  17. ↑ 17.0 17.1 17.2 17.3 State Bank of Vietnam. "Technical characteristics of Vietnamese currency" (in vi). http://www.sbv.gov.vn/CdeHTTT/kthuat.asp. 
  18. ↑ "Curious Vietnamese sneak a peek at no-tear notes, coins". 2003-12-19. http://vietnamnews.vnagency.com.vn/2003-12/18/Stories/12.htm. 
  19. ↑ "Tại sao tiền xu không được ưa chuộng?". Vietstock. http://vietstock.vn/2013/12/tai-sao-tien-xu-khong-duoc-ua-chuong-757-324037.htm. 
  20. ↑ "Nên thu hồi tiền xu khi giá trị thanh toán không còn". Người Đưa Tin. 27 December 2012. http://www.nguoiduatin.vn/nen-thu-hoi-tien-xu-khi-gia-tri-thanh-toan-khong-con-a47915.html. 
  21. ↑ Vietnam Coins 2003 Coins and Banknotes of Vietnam and French Indochina
  22. ↑ "collection/vncoins/vn-20003-o". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-20003-o.jpg. 
  23. ↑ "collection/vncoins/vn-20003-r". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-20003-r.jpg. 
  24. ↑ "collection/vncoins/vn-1k03-o". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-1k03-o.jpg. 
  25. ↑ "collection/vncoins/vn-1k03-r". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-1k03-r.jpg. 
  26. ↑ "collection/vncoins/vn-2k03-o". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-2k03-o.jpg. 
  27. ↑ "collection/vncoins/vn-2k03-r". art-hanoi.com. http://art-hanoi.com/collection/vncoins/vn-2k03-r.jpg. 
  28. ↑ "500,000 Vietnamese Dong: The Story of a Historic Banknote" (in en). https://www.banknoteworld.com/shop/blog/500000-vietnamese-dong-the-story-of-a-historic-banknote/. 
  29. ↑ "Wayback Machine has not archived that URL.". http://english.vovnews.vn/Home/Cotton-banknotes-to-go-out-of-circulation/20129/142580.vov. [|permanent dead link|dead link}}]
  30. ↑ 30.0 30.1 30.2 BBC (2006-10-21). "Vietnam censorship concern grows". BBC News. http://news.bbc.co.uk/2/hi/asia-pacific/6073038.stm. 
  31. ↑ Ngân Hàng Nhà Nước Việt Nam Thông Báo Phát Hành Tiền Mới Vào Lưu Thông
  32. ↑ Ngan Phieu (Bearer's Checks) 1992-2002 Coins and banknotes of Vietnam and French Indochina
  33. ↑ "Zimbabwe money loses three zeros". BBC News. 31 July 2006. http://news.bbc.co.uk/1/hi/world/africa/5231836.stm. 
  34. ↑ "Zimbabwe Suspends Use of Own Currency | News | English". Voanews.com. 12 April 2009. http://www.voanews.com/english/news/a-13-2009-04-12-voa9-69816747.html. 
  35. ↑ "Vietnamese Dong Devaluations 2014-2016". 2016-05-23. http://globalcurrencyreset.net/vietnamese-dong/devaluations/. 

External links



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