Keith Woodford sees Vietnam working diligently to get out of China's shadow, using an open internet to access markets which is helping boost living standards quickly

By Keith Woodford*

Recently I have been working in Vietnam with colleagues from Hue University. After an absence of some eight years, it has been fascinating to see the changes that have occurred, both physical and attitudinal.

There are many ‘Vietnams’. But the Vietnam that I know is the Central North Coastal region, comprising five provinces, with Hue, the old imperial capital, now the regional centre.

The legacy of war

To many Western minds, Hue is still associated with the famous Tet offensive of 1968. This is where the American attempt to dominate Vietnam was lost.

American and South Vietnamese forces eventually won the battle of Hue, after destroying the city with artillery and from the air. But it was this event that convinced the American public that they could win battles but they could never win the war. And that, of course, was how it turned out.

For many years thereafter, there was huge hostility in America towards Vietnam. I saw some of that in the early 1990s when I was working in neighbouring Cambodia.

Cambodia could never have escaped from the clutches of Pol Pot and the Khmer Rouge without Vietnamese help.  After three years, eight months and 21 days of atrocities, the Khmer Rouge were driven from Cambodia in 1979 back to the Thailand border by Cambodian and Vietnamese forces. But it was the Vietnamese forces that really made all the difference.

So the Vietnamese did a huge service to Cambodia in getting rid of Pol Pot and his crazy mates. But for many years, America, Australia and New Zealand still considered Pol Pot the legitimate government of Cambodia.  None of them recognised the real Cambodian Government for another 15 years. It was all a payback for being smashed up in Vietnam – physically, emotionally and in terms of pride.

Vietnam forgave America remarkably quickly, despite the huge pain of what they call the ‘American War’.  But for the Americans, it took longer.

Just two specific examples of that war.  When I worked on a Vietnam project from 2006 through to 2008, my counterpart was a person brought up in the old North Vietnam, about 100 km north of Hue. He lived several years of his childhood in underground tunnels seeking shelter from the American B52 bombers randomly dropping their defoliants, their napalm and their explosive bombs from way up in the sky. For cooking, the Vietnamese had to emerge above ground to maintain a liveable air quality. His school-age sister died from one of those bombs, while cooking the family meal beside the tunnel entrance. 

The colleague I currently work most closely with in Vietnam is Dr Quan, who some years back studied with me for his PhD at Lincoln University. On this trip, I met his father, now in his eighties, who spent seven years working on the Ho Chi Minh trail, that amazing network of mountain paths through which provisions and armaments travelled from the North to the South.

Most Vietnamese families have a personal story from that war, but it is now 41 years since unification of the North and South.  The wheel has now turned in both Vietnam and America, and both countries have now cast aside the historical enmity. 

Economic integration

During my latest visit to Vietnam, I co-chaired a session at an international conference on the economic integration of Vietnam into the world. We heard about the relationships between foreign investment and growth, and we heard considerable enthusiasm for free trade agreements.

In fact, Vietnam has been opening to the world for a long time. It is a member of ASEAN, comprising 10 South East Asian countries, and through those arrangements it also has a free trade agreement with Australia and New Zealand. Late last year, Vietnam successfully completed negotiations for a free trade agreement with the EU. And Vietnam is also an enthusiastic supporter of the TPP.

The official statistics show Vietnam continuing to grow at about 6% per annum, and from what I saw that is no exaggeration. There are lots more motor bikes, cars and now smartphones, even in the country side.  And the housing quality is definitely improving.

Vietnam still considers itself a communist country, and nothing happens without approval of the Communist Party. But it is apparently much less authoritarian relative to China. One immediate difference is that Vietnam does not censor the internet.   This alone creates a totally different atmosphere.

China’s shadow

To understand Vietnam’s enthusiasm for integration with the West, one has to understand something of the relationship with China. It is an uneasy relationship.

Before the colonial era starting in the 19th century, Vietnam was dominated by China for more than 1000 years.   And then much more recently, when Vietnam invaded Cambodia in 1979, China responded by invading the northern provinces of Vietnam to teach the Vietnamese a lesson. Senior Brother had spoken.

More recently, China and Vietnam have had ongoing tense relationships relating to the South China Sea. Vietnam, the Philippines, Malaysia and Indonesia all see China’s actions there as being a militaristic power play. In contrast, China asserts its actions are consistent with historical boundaries.

Vietnam still depends on China as its most important trading partner, but that in itself is a cause for concern. Hence, Vietnam is reaching out for increasing integration with the West, not only for economic reasons, but also as a counter balance to China.

The Vietnamese Government tries to remain respectful of China – it makes no sense to get into a fight, given the differences in size and power. But beneath the surface there is no doubt as to the extent of the concern.

Rural development

After the conference, Dr Quan and I visited some communes in Quang Binh Province between 100 and 200 km north of Hue. These were communes which Quan had studied while undertaking his PhD some ten years ago. We wanted to start updating the data, including visiting the same families that Quan had studied back then.

Our first visit was to a coastal commune which relies on fishing.

This commune had no road access until 2000, and Quan had chosen it because it was one of the poorest communes in the province, with Quang Binh itself being one of the poorest provinces in Vietnam.   On this visit, we focused on the macro picture. Quan will subsequently go back and fill in the detail. But what I saw was evidence of considerable progress, despite ongoing environmental and economic vulnerability.

More than 95% of the commune households now have electricity. Mobile phone coverage came in 2009 and almost all families now have at least one mobile phone. Most families also have a motor cycle.

Although the Vietnamese still talk of ‘communes’, a more accurate translation would be ‘administrative communities’.  In theory, the land is still owned by the Government, but in practice, ongoing land-use rights are considered secure.  Farming is undertaken in family units.

Subsequently, we visited a mountain commune adjacent to the Lao border, where most of the local people are from an ethnic minority.  Once again, this commune had been chosen by Quan, back in 2006, for its high level of poverty.  

Back in 2006, there was no phone communication system in this mountain commune. In a community of 1500 people, the only motorcycles were owned by traders. A fine weather road came in 2000 and an all-weather road in 2008. Electricity came in 2006.

Now, about 65% of the families have a motor bike and almost everyone has a smart phone. This means that the farmers are now connected to markets.

There is more progress to be made in this mountain commune. The local people are all investing at the family level in production forestry as a replacement for logging of natural timber. But it is still early days in getting the new industry to the harvest stage. And 54% of households are still classed by the Government as being in poverty.

Looking ahead

Vietnam still has big challenges. There are about 94 million people in Vietnam, and population continues to grow at about 1% per year. But this all seems manageable. However, industrial pollution is a huge issue in many parts of Vietnam. And China is casting a big shadow. 

Health and education are fundamental issues, and it seems that Vietnam is making big progress there. Life expectancy is now 73 years, but maternal deaths and child mortality are still too high. At the University of Hue, there are now 80,000 students. And Vietnamese students are also spreading out across the world to overseas universities. So something is indeed happening.

Keith Woodford is Honorary Professor of Agri-Food Systems at Lincoln University. He combines this with project and consulting work in agri-food systems. His archived writings are available at http://keithwoodford.wordpress.com