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The more things change, the more they stay the same...In Vietnam at the start of 1999, the central domestic problem continues to be, as it was during the first and second decades of Vietnamese re-integration, the incompatibility of economic liberalisation with political control by the Communist Party in Hanoi.
In 1986, Vo Van Kiet and reformists in the Vietnamese Politburo won a major victory over their conservative adversaries with a decision to introduce de-collectivisation of agricultural land. Communes were gradually disbanded and farmers were able to sell their surplus produce on the open market. Everyone benefited, and there was substantial gain in productivity and rural wealth.
In December 1998, the Sixth Plenum of the Communist Party's Central Committee became deeply divided over the next logical step in agricultural modernisation - the need to extend agricultural leases and increase maximum farm sizes beyond the current three hectare limit, thereby making farms more viable commercially and allowing them to attract foreign development capital and management. According to the progressives, only such radical steps will allow the primary sector to break out of a current regressive slump. The Politburo and Central Committee were themselves divided on the issue, and sent a choice to the normally acquiescent National Assembly. The Assembly opted for the status quo, a triumph for local political interests and a poke in the eye for progressive elements, including Party General Secretary Le Kha Phieu.
Another intractable problem concerns how much urban private property, confiscated by the Party during the revolutionary period after the departure of the French from the north and the Americans from the south, should be returned to its former owners. The politics are intricate, emotions are high, those with opposing philosophies are well organised and vociferous, and the Party has done nothing.
Further signs of the indecision and powerlessness of the Central Committee to deal constructively with such problems appeared in December 1998 and January 1999. The issue was the perennial one of official corruption and the absence of the rule of law in commercial dealings, particularly but not exclusively in Ho Chi Minh City. In December, Mai Chi Tho (Le Duc Tho's brother) was reported to have criticised the deterioration of the Party and society in general terms. So did another senior Party member, Huu Tho, head of the Party's Ideological and Cultural Committee, although he targeted specifically the arbitrary and corrupt methods of police, customs officers and the courts.
These concerns, and a pronouncement in the same month by General Secretary Le Kha Phieu, may signal further attempts to tighten commercial and individual practices to curb abuses. In a letter to a conference marking the 50th anniversary of the UN Declaration on Human Rights, Le said the country needs to be selective in absorbing 'human values' and watchful of people trying to exploit democracy to interfere in the country's internal affairs.
In spite of its hosting of an ASEAN summit in December 1998, the Vietnamese government's record of indecision in dealing with domestic problems suggests that it can hardly be expected in the near future to take a leading role in addressing important regional issues.
WATCHPOINT: Vietnam, beset with internal difficulties, will be further stretched to deal with economic weakness and political divisiveness in ASEAN, and the growing territorial consolidation of China's presence in the South China Sea.
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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