Contemporary Vietnam

A Guide to Economic and Political Developments

Ian Jeffries

• Publisher: Routledge
• Year: 2011
• Print ISBN: 9780415604000
• eBook ISBN: 9781136849015
• Topic: Politics & International Relations
• Subtopic: Political Economy
• Index: Politics & International Relations

This book provides full details of contemporary economic and political developments in Vietnam. It continues the overview of developments up to late 2005 which were covered in the author's Vietnam: A Guide to Economic and Political Developments (also published by Routledge, 2006). Key topics covered include Vietnam's success, in general, in maintaining high rates of growth in the face of problems such as inflation and the global financial crisis; continuing economic reforms; foreign trade and investment; battles against corruption; population growth; the determination of the Communist Party to maintain its hold on power; and Vietnam's response to public health problems such as AIDS, SARS and bird flu.

1 Political developments

Political background

Vietnam means ‘land to the south’ (of China).

‘After years of intermittent rule by Chinese dynasties, Vietnam – often called the Land of the Blue Dragon – achieved independence in the tenth century’ (The Independent, 14 November 2006, p. 25).

‘Vietnam was a tributary state of China for 1,000 years and was invaded by China in 1979, and the two countries continue to joust for sovereignty in the South China Sea’ (www.iht.com, 28 June 2009).

France began the colonial period for Vietnam in 1858 with the capture of present-day Da Nang, seized Saigon in 1861, and formed the protectorates of Annam and Tonkin by 1883.

‘Vietnam has a consensual leadership. Its triumvirate of president [Nguyen Minh Triet], party boss [General Secretary Nong Duc Manh] and prime minister [Nguyen Tan Dung] must reach accommodations with an increasingly independent national assembly and a host of other forces’ (The Economist, Survey, 26 April 2008, pp. 6, 15). ‘A recent opinion poll by TNS and its affiliates found Vietnam's youthful population to be the most optimistic in Asia’ (pp. 15–16). ‘Party cells remain mandatory for all businesses, even private ones’ (p. 15). ‘The government insists that there are no political prisoners in its jails, though some detained dissidents have done nothing more than call for democracy’ (p. 15).

‘Vietnam wants to become a rich, high-tech country and has set a target date of 2020 for getting there’ (The Economist, 26 April 2008, p. 16).

‘Vietnam receives low marks in comparison to other East Asian countries on the various corruption perception surveys. For example, the World Bank's composite rankings place Vietnam below even China and far below Thailand and Malaysia’ (Pincus and Ahn 2008: 31).

A Vietnamese government report [on climate change] released last month [August 2009] says more than one-third of the [Mekong] Delta, where 17 million people live and where nearly half of the country's rice is grown, could be submerged if sea levels rise by 1 metre (3 feet) in the decades to come . . . The risks to Vietnam go far beyond the Mekong Delta, up into the Central Highlands, where rising temperatures could put the coffee crop at risk, and to the Red River Delta in the north, where large areas could be inundated near Hanoi.

(IHT, 24 September 2009, p. 8)

Top notch universities do little original research, and are rarely cited by scientific scholars, says a recent UN-financed study. Graduates are poorly prepared: as many as 60 per cent of new hires by foreign companies needed retraining, according to a Dutch report. Vietnam already spends more on education [as a percentage of GDP] than its neighbours [Malaysia, Thailand, Indonesia, the Philippines, Laos and Cambodia]. Literacy rates are high, and parents sacrifice much to put their children through college. Enrolment at Vietnamese universities rose from about 900,000 in 2001 to over 1.6 million by 2006. But most students study at lacklustre public universities or at private diploma mills. Those who can afford to go overseas. The best and the brightest . . . rarely return. Efforts to reform public universities have floundered. So the government has seized on the idea of creating four new research-orientated institutions from scratch, with foreign universities as partners and, crucially, promises of autonomy. The first of the new breed, the Vietnamese German University (VGU), opened in 2008 in Ho Chi Minh City. A French-backed technology school in Hanoi will follow. VGU has around 220 students, enrolled in engineering and economics programmes, which are taught, in English, by visiting German professors. Within ten years it hopes to have 5,000 students. Its independent charter, a first for a Vietnamese university, allows it to hire professors and design its own courses . . . For the moment VGU gets most of its money from Germany. Vietnam contributes a modest Euro 365,000 ($500,000) a year. But it must eventually bear the running costs, which are forecast to reach Euro 45 million to 50 million by 2030 . . . Academics in both China and Vietnam are hemmed in by political dogma.

(www.economist.com, 30 September 2010;
The Economist, 2 October 2010, pp. 67–8)

A chronology of political developments since the Tenth
Congress of the Communist Party held 18–25 April 2006

18–25 April 2006. The Tenth Congress of the Communist Party is held.

Nearly 1,200 party delegates to the event will set the political and economic course of the nation of 83 million people until 2010. Delegates representing 3.1 million party members will recommit to Marxism–Leninism, Ho Chi Minh thought and the twenty-year-old doi moi, or renewal, programme toward a ‘market economy with socialist orientation’ . . . Party members [will] choose the new 160-member Central Committee and the elite Politburo with at least fifteen members.

(www.iht.com, 16 April 2006)

‘Party statistics show it has 3.1 million members in the population of 83 million people’ (www.iht.com, 18 April 2006).

The five-yearly . . . week-long . . . Communist Party Congress [is] starting Tuesday [18 April] amid a corruption scandal that has already claimed several government officials . . . Transport ministry cadres [have] embezzled millions of dollars . . . Transport minister Dao Dinh Binh resigned earlier this month [April] and his deputy was jailed over revelations that officials in the ministry's Project Management Unit 18 had taken funds earmarked for highways and other infrastructure. The scandal emerged in January with the arrest of the unit's chief, Bui Tien Dung, for betting $7 million, much of it from Japan and the World Bank, on European soccer matches. The state-controlled press has been allowed to report aggressively that officials took kickbacks, bought luxury homes and sought to pay off the police and officials for protection . . . ‘There is now a serious crisis of trust among our people and in our party,’ a former interior minister, General Mai Chi Tho, was quoted as [saying] . . . General Vo Nguyen Giap, who led Vietnamese forces to victory against French and US troops, said . . . that ‘the party has become a shield for corrupt officials’.

(www.iht.com, 16 April 2006)

Within Vietnam's ministry of transport Project Management Unit 18 handled more than $2 billion allocated for road and bridge building and other infrastructure . . . Much of the cash [was] from low interest loans and grants by the World Bank and the Japanese government. Bui Tien Dung [was] the powerful civil servant who ran the unit . . . In January [he] confessed to betting $7 million of ministry money on European football matches . . . A Swedish-funded study by the Communist Party's internal affairs committee found 69 per cent of Vietnam's businesspeople and 64 per cent of the general public considered corruption the country's most serious problem . . . In 2004 the then deputy trade minister was arrested for selling garment export quotas. Senior officials from Vietnam Airlines’ petroleum subsidiary were arrested for illegally exporting oil to Cambodia. In November [2005] the National Assembly adopted legislation requiring government officials and close relatives to file asset declarations. A purge took place at PetroVietnam, the state-owned oil and gas company. The general director and his deputy were sacked for misconduct while tendering for Vietnam's first oil refinery . . . Three months after Mr Dung's confession his patron, Nguyen Viet Tien, deputy transport minister and former head of the planning unit, was also arrested and charged with negligence and breaking laws of economic management. Dao Dinh Binh, transport minister, was pressed to resign.

(FT, 18 April 2006, p. 6)

An office computer log showed almost 200 [transport] ministry employees followed suit [after Bui Tien Dung] and wagered online with government funds earmarked for bridges and roads . . . Sports gambling is now an obsession across Vietnam, not just in government offices.

(The Independent, 20 April 2006, p. 31)

[The] Communist Party opened its congress on Tuesday [18 April] vowing to choose new leaders ‘with talent and morals’ to fight corruption and accelerate economic reforms . . . [The government] will for the first time give each of the 1,176 delegates the right to recommend candidates for the top post of general secretary . . . In the past the elite Politburo alone chose the general secretary . . . Officials announced changes in the method of choosing the general secretary after a special plenum in the past few days to discuss personnel selection following the corruption scandal . . . The incumbent general secretary, Nong Duc Manh, acknowledged in his opening speech that corruption was ‘one of the risks that threaten the survival of our regime’ . . . Manh said the eight-day congress wanted ‘to further accelerate’ Vietnam's change from a centrally controlled economy to a market-orientated one . . . Manh: ‘In the next five years it is our policy to continue to improve market economy status with socialist orientation and to speed industrialization and modernization in close relation with developing a knowledge-based economy.’

(www.iht.com, 18 April 2006)

‘General Secretary Nong Duc Manh told more than 1,100 delegates that the party's Central Committee must “seriously make a self-criticism” for allowing corruption to “threaten the survival of our regime” ’ (The Independent, 20 April 2006, p. 31).

Correspondents say the gathering has been overshadowed by the corruption scandal . . . Senior transport ministry officials are accused of using state funds to bet on football matches and buy luxury cars . . . General Secretary Nong Duc Manh warned party members the issue was threatening ‘the survival of our regime’. He stressed the party aimed to ‘build a clean and strong leadership and management, to overcome a huge risk’.

(www.bbc.co.uk, 24 April 2006)

On Sunday [23 April] 1,176 delegates elected a new Central Committee and 160 of its members will choose the fifteen to seventeen people for the powerful Politburo. Analysts expect that both President Tran Duc Luong, sixty-eight, and prime minister Phan Van Khai, seventy-two, will announce their retirements during the congress. However, the sixty-five-year-old General Secretary Nong Duc Manh is seen as likely to stay on. The front-runner for the premier's job is deputy prime minister Nguyen Tan Dung, fifty-six. Ho Chi Minh City party chief Nguyen Minh Triet, sixty-four, is seen as the top contender for the presidency. If the two southerners are chosen, correspondents say the move would mark a departure from the formula that kept the top three positions evenly distributed between the north, centre and south of Vietnam. The new line-up will reportedly be announced on Tuesday [25 April] at the close of the tenth congress – and must then be approved by the National Assembly.

(www.bbc.co.uk, 24 April 2006)

Vietnam's Communist Party announced . . . during the closing session of the eight-day National Party Congress in Hanoi [on 25 April] . . . that Nong Duc Manh will be reappointed as its general secretary for another five-year term . . . Other key positions, such as those of prime minister and president, have yet to be appointed . . . Other key roles, including those of president, prime minister and chairman of the National Assembly have yet to be decided, but correspondents say they should become clear once the National Assembly, Vietnam's parliament, meets next month [May] . . . The newly elected Politburo . . . has been half replaced by younger members. Current premier Phan Van Khai, President Tran Duc Luong and the National Assembly chairman Nguyen Van An all announced they would not seek to continue their positions after age limitation has been reinforced . . . The congress has agreed on ambitious economic targets, including the maintenance of a high growth rate of 7.5 per cent to 8 per cent a year, and for Vietnam to achieve the status of an industrialized country by 2020.

(www.bbc.co.uk, 25 April 2006)

Nong Duc Manh, fifty-six . . . a member of the Tay ethnic minority . . . while affirming the Communist Party's central role in policy and continued state ownership of the country's major strategic industries, said economic reforms would be pursued ‘in a stronger, more comprehensive manner and develop with a faster and sustainable pace’ . . . Manh said his main goal was to raise living standards in a nation where the gap between rich and poor has grown wider and to make Vietnam an industrialized nation by the year 2020, with the number of people living in poverty cut to 10 per cent. Per capita is now only $640 a year, with 75 per cent of the population living in the countryside . . . [Vietnam] plays host to dozens of world leaders in November at an annual meeting of the Asia-Pacific Economic Co-operation forum. President George W. Bush is expected to attend, following in the footsteps of Bill Clinton, who in 2000 was the first US president to visit postwar Vietnam . . . A new fourteen-member Politburo . . . was also announced [on 25 April] . . . The party congress also mandated a change in the three top government positions: president, prime minister and chairman of the National Assembly . . . who are to be voted in at a separate meeting of the National Assembly . . . The age of . . . the Communist Party's . . . leaders is dropping.

(www.iht.com, 25 April 2006)

On 22 April Bill Gates, the founder of Microsoft, visits Hanoi University.

Prime minister Phan Van Khai and President Tran Duc Luong had earlier taken time away from the . . . National Congress, the most important event on the political calendar, to meet Mr Gates. Under an agreement signed Saturday [22 April] Vietnam's finance ministry became the country's first government office to use completely licensed Microsoft software. A statement said the agreement ‘reaffirms the government's commitment in copyright protection as the country integrates into the international community’.

(www.bbc.co.uk, 22 April 2006)

‘Bill Gates landed in Hanoi for a one-day visit and was received as a conquering hero . . . [He] was given a red carpet welcome at the dilapidated Hanoi University of Technology’ (FT, 24 April 2006, p. 7).

The most important Communist Party meeting in five years was under way. And the star of the show was . . . Bill Gates. The president, the prime minister and the deputy prime minister all excused themselves from the party meeting to have their pictures taken with the man who has more star power in Vietnam than any of them. When they heard he was in town hundreds of people climbed trees and pushed through police lines to get a glimpse of him. He was the top story in the next morning's newspapers . . . About half the population of 83 million was born after the war with the United States that ended thirty-one years ago. This is a country that is very much looking toward the future, not to the past. Reaching out in an unprecedented way the party published its draft documents for public discussion early this year [2006] and received, by Nong Duc Manh's count, tens of thousands of comments, suggestions and criticisms . . . This is the first party congress since the meetings began in 1951 that has not invited delegations from foreign communist parties.

(Seth Mydans, IHT, 27 April 2006, pp. 1, 7)

As Vietnam has opened its economy to the rough and tumble of the free market, officials have spoken often of the need to combat corruption. But investigations and prosecutions have never publicly touched the highest ranking members of the party and government . . . Over the years the government has repeatedly tried to address the problem and hundreds of midlevel officials have been investigated and arrested . . . Most wounding was a comment from Vo Nguyen Gap, the former general who is an icon of Vietnam's victories over both the French and the Americans. In a widely quoted comment he said: ‘The party has become a shield for corrupt officials’ . . . Even Nong Duc Manh's predecessor as general secretary, Le Kha Phieu, has talked of the limits to what even the most powerful leaders can do . . . [Le Kha Phieu, 2005]: ‘We should say frankly to each other that corruption is still widespread at a serious level. Myself and Vo Van Kiet, the former prime minister, knew of some particular cases but could not unravel them and make them public. Corruption is guarded by the perpetrators and even defended by outside sources. This really is a fierce battle in which, if we wish to win, the party and the state must take a close look at themselves.’

(IHT, 5 May 2006, p. 2)

‘The party congress approved a law letting its members engage in business . . . In truth, many party bosses are already up to their necks in capitalism’ (The Economist, 29 April 2006, p. 68).

The new five year plan, approved at April's congress of the ruling Communist Party, is laden with targets for increasing output and improving infrastructure, with the objective of ma...

Table of contents

• Front Cover
• Contemporary Vietnam
• Guides to economic and political developments in Asia
• Title Page
• Copyright
• Contents
• Acknowledgements
• Introduction and summary
• 1 Political developments
• 2 The economy
• Postscript
• Bibliography
• Index