Background

Downs (2004) suggested that the indirect causes for traffic congestion are the large increases in population, income improvement, households and employment at an area.
Domestic Context
Vietnam population grew at the rate of 1.5% annually and reached over 86 millions people in 2010 from 1986.There are over 6.5 million, excluding nearly 3 million from rural areas nearby, people in Hanoi (GOFPOFP, 2011). The economic development of Vietnam has rapidly increased in the last 25 years. According to the World Bank (2011), the average annual economic growth rate of Vietnam is stabilized at 7.1% over the last decade. As a result, Vietnam has become the lower middle income nation in 2010 with the gross domestic product (GDP) per capita is $US 3200, which increased by more than 100% from $US 1400 in 2000. The below table illustrates the GDP per capita in $US of Vietnam in recent years.

(Source: the World Bank, 2011)

International context

Since implementing its Reform (Doi moi) in 1986, Vietnam has gradually integrated into the world. Up to now, Vietnam has signed numbers of international agreements such as: Free Trade Agreement with China, India, Australia, New Zealand; Economic Partnership Agreement with Japan; Kyoto Protocol and United Nations Framework Convention on Climate Change (UNFCCC)…etc. Besides, Vietnam is an active member of several important international organizations. At regional level, Vietnam is the member of Association of Southeast Asian Nations (ASEAN). At global level, Vietnam is member of United Nations, Asia Development Bank and World Trade Organization…etc. To comply with the obligation of the international agreements as well as international organizations, Vietnam has to open his market, including car and motorbike, for nations in region and in the world.