In a region where governments are swollen with foreign currency reserves and inflation remains relatively tame, Vietnam is an island of economic instability.

The country’s economy is still growing at 7 percent a year, but double-digit price increases for food and other essentials are punishing the working class and contributed to a top credit rating agency’s recent decision to downgrade the country’s sovereign debt. Vietnam’s currency is consistently falling below the official exchange rates, creating a thriving black market for gold and dollars.

The problems, say many businesspeople and economists, are rooted in Vietnam’s continued heavy reliance on state-run companies despite the country’s opening to more private enterprise, which has expanded rapidly and profitably. For years the government considered its vast network of state-run companies as the vanguard of the economy, large conglomerates that the Communist Party could use to steer the country toward prosperity.