THE ECONOMIC SITUATION IN SOUTH VIETNAM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82S00205R000200010039-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 7
• Document Creation Date: December 20, 2016
• Document Release Date: August 25, 2006
• Sequence Number: 39
• Publication Date: April 14, 1969
• Content Type: IR

Api roved For Release 2007/03/08: CIA-RDP82S00205R000200010(39-0
Secret 7 '
DIRECTORATE OF
INTELLIGENCE
Intelligence Report
The Economic Situation in South Vietnam
(Weekly)
USAID review completed
State Dept. review completed
Secret
122
14 April 1969
No. 0489/69
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Secret
WARNING
This document contains information affecting the national defense of the
United States, within the meaning of Title 18, sections 793 and 794, of the
US Code, as amended. Its transmission or revelation of its contents to or
receipt by an unauthorized person is prohibited by law.
Secret
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CENTRAL INTELLIGENCE AGENCY.
Directorate of Intelligence
The Economic Situation in South Vietnam
Summary
South Vietnam has had a national lottery
system since 1951. In recent years-revenues
from the lottery have grown steadily and-the
lottery has become.an important -saurce of gov-
ernment revenue. During 1965-67, earnings from
the lottery were equivalent to roughly half the
amount of revenue provided by the income tax and
more than five percent of total revenues from all
domestic taxes. Since the Tet offensive in Feb-
ruary 1968; all revenue from the lottery has been
allocated to the National Office of Housing.
The Saigon retail price index rose one per-
cent during the week ending 31 March.. The price
index for imported commodities was unchanged for
the fourth consecutive week. Free market cur-
rency and gold prices were lower.
ANNEX: Weekly Retail Prices in Saigon (Table)
Currency and Gold Prices (Graph)
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National Lottery System
1. A recent USAID study of the national lottery
system in South Vietnam shows that revenues from the
lottery have grown steadily in recent years and the
lottery has become an important source of government
revenue. The national lottery system, which was es-
tablished in 1951, is operated by the National Recon-
struction Lottery Service, an autonomous agency within
the Ministry of Finance. Every week five million
tickets are sold at a price of 20 piasters each. Five
top winners are chosen weekly and each receives 2 mil-
lion piasters ($16,950), tax-exempt. Although the
chances of winning this amount are only one in a mil-
lion, there are other prizes ranging from 200 to
200,000 piasters.
2. In recent years administration of the lottery
has been improved in order to maximize government
revenues from this source. Government agencies,
rather than private dealers, now distribute the
tickets and distribution is controlled by an inter-
ministerial committee. The price of each ticket was
raised from 10 to 20 piasters, and the number of
weekly tickets increased from 3 to 5.million. As a
result, net revenues from the lottery have increased
as follows
(in millions of piasters):
1965
390.6
1968
1,054.1
1966
579.4
1969
1,500.0
(est.)
1967
1,018.3
Earnings from the lottery during 1965-67 were equiva-
lent to roughly half the amount of revenue provided
by the income tax and more than five percent of
total revenues from all domestic taxes.
3. From the weekly. sales, roughly 60 percent
is paid out in prizes, 30 percent-is retained by the
government, and 10 percent is used for lottery op-
erating expenses. Prior to 1966, the net revenue
from the lottery went to the Lottery-Reconstruction
Service for extending home loans-to, and building
homes for, the needy. During 1966-67, the revenue
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was allocated to the government's national budget.
Following the Tet offensive in February 1968, the
prime minister decreed that all revenue from the
lottery would be deposited in the autonomous budget
of the National Office of Housing.
Prices
4. The Saigon retail price index:rose.one per-
cent during the week ending 31 March; prices of both
food and nonfood items increased slightly. Rice
prices were steady or lower as deliveries from the
1968-69 crop continued to arrive in Saigon. The
price of most protein foods such as pork,'beef, and
chicken rose sharply as a result. of increased de-
mand prior to Easter and a Buddhist. holiday. The
price index for imported commodities was unchanged
for the fourth consecutive week. Among imported
commodities, the items showing the greatest price
increases were iron and steel products and kerosene.
Higher kerosene prices resulted from an increase in
the cost of the metal containers for this fuel.
Sugar prices registered the largest decline. (A
table of weekly retail prices in Saigon is included
in the Annex.)
Currency and Gold
5. Free market currency and gold. prices were
lower during the week ending 31March..- The price
of dollars declined three piasters to:191 piasters
per dollar. For the third consecutive week, the
price of gold declined; the price of a dollar's
worth of gold leaf on 31 March was 276 piasters per
dollar, or five piasters below the price-of the pre-
vious week. The price of MPG (scrip) fell two
piasters to 151 piasters per dollar,. (A-graph on
monthly and weekly currency and-gold prices is in-
cluded in the Annex.)
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Weekly Retail Prices in Saigon
2 Jan
6 Jan
10 Mar,
17 Mar
24 Mar
31 Mar
1968
1969
1969
1969
1969
1969
Index for All Items 308
400
32
22
32
Index for Food Items !.t
AA2
422
440,
446
-45-0
Of Which:
(In Piasters)
Rice-Soc Nau
(100 kg.)
2,500
3,100
3,200
3,100
3,050
3,000
Pork Bellies
(1 kg.)
220
260
230
220
240
260
Fish-Ca Tre
(1 kg.)
230
310
310
330
320
300
Nuoc Mam (jar) 150
220
220
220
220
220
Index for Nonfood Items
241
M
306
222
305
309
Of Which:
(In Piasters)
Firewood (cu. meter) 600
800
740
740
760
780
Cigarettes (pabk) 14
22
22
22
22
22
White Calico (meter) 52
82
70
68
68
68
Kerosene (liter) 9
10
10
10
10
11
a. Data are from USAID sources. For indexes 1 Jan 1965 = 100.
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GOLD Bosis gold leaf worth $35 per troy,ounce
US $10 `GREEN
Saigon Free Market Gold and Currency Prices
App