Vietnamese Dong 2025: Current Value, History, and Vietnam’s Economy Insights
Explore the Vietnamese dong (VND), Vietnam’s official currency since 1978, its historical evolution, economic impact, and current exchange rates in 2025.
Understanding the Vietnamese Dong: Vietnam’s Official Currency
The Vietnamese dong (VND) is the official currency of Vietnam, introduced in 1978 to replace the earlier Vietnamese hao. Historically, the hao was one-tenth of a dong and was further divided into ten xus, but these smaller units are no longer in circulation today.
Historical Background and Currency Evolution
The Vietnam National Bank initially issued the hao and xu, but since 1960, the State Bank of Vietnam has taken over central banking responsibilities. Due to persistent inflation over the years, the dong’s denominations have increased significantly, making smaller units like the hao obsolete. The hao first appeared as banknotes and later as aluminum coins, but it ceased to be legal tender decades ago.
The Vietnamese Dong Today: Features and Economic Role
In Vietnamese, the term “dong” broadly means money and can be adapted to refer to other currencies by prefixing the country’s name, such as the “U.S. dong” for the U.S. dollar. The State Bank of Vietnam currently issues the dong, which faces ongoing inflation challenges, positioning it among the world’s weaker currencies. For instance, in 2018, 1 USD was equivalent to approximately 22,770 VND.
Although dong coins are no longer minted or widely used in daily transactions, they remain legal tender and can be deposited at banks. Banknotes are available in denominations of 1,000, 2,000, 5,000, 10,000, 20,000, 50,000, 100,000, 200,000, and 500,000 dong.
Significance of the Dong in Vietnam’s Economy
The Vietnamese dong traces its roots back to 1946 when the Viet Minh government introduced it to replace the French Indochinese piastre. South Vietnam issued its own dong starting in 1953, with banknotes displaying values in both dong and piastre. Following reunification in 1978, the dong became the unified currency for the entire country.
Today, the State Bank of Vietnam plays a crucial role in stabilizing the currency, managing fiscal policies, supervising commercial banks, issuing government bonds, and overseeing the nation’s international reserves, all vital for Vietnam’s economic growth and financial stability.
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