Economic Development in Vietnam

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Table of Contents

Introduction
Data Collected
Analysis
Challenges
Works Cited

Introduction

The impression created whenever one talk about Vietnam is normally a negative one. It rings the bell of a series of political instabilities that had plagued the country for a long period. These instabilities have had substantial negative effects on the economic performance of Vietnam. It will be recognized that in the 1990s the country mostly depended on foreign aid from the international community. However, that gloomy trend is reversed and this has seen several positive changes realized in the country.

For instance in 1993, 58% of the population in Vietnam lived below the poverty line as internationally set (Karnow 12). However, by 2009, the figure had substantially reduced to 28%. The per capita income in Vietnam rose from as low as $225 in 1994 to a massive $1000 in 2010 (Mcmahon 130).This raises the question as to what factors could have enabled Vietnam to gradually shift from poverty to better times.

Data Collected

When Vietnam was given the green light to join the World Trade Organization, many people felt that it was indeed a good start to economic development in the country. The people of Vietnam had humble hopes that their country could now manage to move away from the rank of the poorest countries in the world by 2010, a position it had perpetually stayed in the past. Today, life in Vietnam is very reminiscent of any other developing country in the world. Though much of the population still lives in the rural areas, rural-urban migration is beginning to be seen in the country.

Vietnam has managed to achieve economic success courtesy of the renovation processes that were initiated in 1986. The country has managed to maintain an economic growth rate of over 7% in much of the last two decades. This faster growth is demonstrated in the economic developments that have been seen throughout the country. As a result, the country has managed to gain from its integration to the world. Much of these are realized because of the policy reforms that have characterized Vietnam in the last few years.

The economic reforms that were adopted in the late 10990s totally changed the manner in which economic activities were conducted in the country. Trade liberalization was advocated and this assisted in opening the doors of Vietnam to the whole world. The people could now benefit greatly from the flood of goods that came in through their shores. The competition posed by foreign trade enabled many industries in Vietnam to strengthen up in the face of globalization and other changes that were evidenced in the world.

Even though no political reforms have been instituted in the last few years, governance has relatively been good. This has been a great boost to the country as economic activities continue to blossom. In 2006, the government of Vietnam unveiled a development blueprint that was meant to make the country gain middle-income status by the year 2010. This paper, Socio-Economic Development Plan (SEDP), was anchored on four pillars that were meant to provide the ground upon which the economy would develop. Te first pillar included measures intended to accelerate the economic growth of the country.

Considering the turbulent times that have governed the history of Vietnam, the second pillar was fostered on improving governance in the country. The third pillar was formulated with a view to strengthen the social sector in the country and make every citizen feel part of the country. This was a good objective since it has been proven that countries only become successful if the citizen feel included in the transformation of their country. The fourth pillar on the other hand was initiated in light of the fact that the country is richly endowed with natural resources. It was proposed that protecting these resources be made a national priority to enable the country and its posterity benefit from them.

Analysis

There has indeed been a positive trend in achieving the objectives that were laid down in the various economic reforms instituted. Infant mortality in under five year olds was over 58 deaths per 1000 births in 1990 and this figure has been reduced by close to half at 25 deaths per 1000 births in 2010. On the other hand, maternal mortality rate was 120 deaths per 1000 births in 1990. In the year 2000, improvements in the health sector and other policy reforms across the country, reduced the figure to 60 deaths per 1000 births. The education sector in the country has not been left behind in the face of these improvements.

In 1990, the national enrollment rate in primary schools was 90%. Recognizing that the progress of the country heavily depended on the quality of its human resource, the government launched massive educational reforms that made huge numbers of children get an education. As a result, the national enrolment rate in primary schools by 2010 was 99% (Tucker 89). Food security in the country has also been improved. For instance in 1992, 25% of households in Vietnam could not manage 2100 calories per person per day. The figure has since reduced to less than 4%.

All prospects indicate that all the goals as outlined in the Millennium Development Goals MDGs will be achieved in the near future. This is as a result or the good economic trend that is realized in the performance of the economy. The opportunity to join the WTO made many people to invest in Vietnam. The relatively peaceful environment that characterized the country unlike many of its neighbors bolstered foreign direct investment in Vietnam. The influx of foreign capital into the country has had substantial gains to the people. Employment opportunities have continued to grow and this has really improved the economic performance of the country. A comparison with other Asian countries will prove the fact that Vietnam has greatly managed to spread its development tentacles at a faster rate.

One of the most important and interesting issues about economic development in Vietnam is the fact the government has been at the forefront in supporting policies that foster growth while at the same time allowing room to enable the private sector to flourish (Swash 37). Such a move is very critical given that the government can strategically know which areas to lay much stress on to achieve progress. All these improvements have been reflected in the manner in which the GDP of Vietnam has continued to maintain a steady growth rate. Currently the real GDP growth rate stands at 6.8%, which is a slight drop from an earlier figure of 8% in 2008 (Drury 25).

Challenges

In the face of all the progress and developments that have been seen in Vietnam, it has not been a smooth sail all along. The country is still ravaged by myriad problems that should be addressed by the government. HIV & AIDS continues to be a major challenge. Income disparities are also beginning to be felt as a challenge to eradicating poverty in the country. Increased rural-urban migration has also brought with it the negativities associated with over population in the towns. The government should therefore focus its energies in finding solutions to this growing wave of problems.

Works Cited

Drury, Peter. Socio-economic developments in Vietnam. A Global agenda 2.3 (2011): 23-6.

Karnow, Stansey. A History of Vietnam. New York: Penguin, 2010.

Mcmahon, Robert. Problems in the History of Vietnam. Toronto : Prentice Hall, 2011.

Swash, Rachel. Vietnam War and the Aftermath: The highs and lows. New York: John Wiley & Sons, 2010.

Tucker, Spencer. Vietnam: An Economic Perpective. Cambridge: Cambridge University Press, 2011.

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Economic Development in Vietnam

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