VIETNAM: by Jeffry Babb News Weekly
Economic tiger, political laggard
, August 4, 2007
Vietnam's economy grew by a staggering 8.17 per cent in 2006. What are the chances of Vietnam evolving into a free, prosperous and democratic country? Jeffry Babb reports.Many thousands of tourists visit Vietnam every year for pleasure — it's now one of the prime destinations for visitors from around the world.
Tourists can see the famous water-puppets in Hanoi, the stark karst rock formations of Halong Bay and the former presidential palace in Saigon. Officially, the former South Vietnamese capital is now called Ho Chi Minh City, but many natives still use the old name.
However, the Taiwanese, who are keen travellers, only go to Vietnam on business. "Why would we want to go there?" they ask. "It's just like Taiwan 30 years ago — it's not even a modern country." Taiwan is one of the biggest foreign investors in Vietnam. They see big opportunities.Country buzzing
Vietnam is indeed like Taiwan three decades ago. Vietnam's tiger economy grew by 8.17 per cent in 2006, unmatched in Southeast Asia, and exceeded in East Asia only by China. From the north to the south, the whole country is buzzing.
The south is the epicentre of growth and Saigon remains the commercial centre of the country, but factories are springing up in the north as well. The north remains the centre of government and cadres from the north still dominate politics in Vietnam — you can see the preserved body of revolutionary leader Ho Chi Minh in his mausoleum in Hanoi.
Reminders of what the Vietnamese call "the American War" are everywhere, but it's only one war among many — and the Vietnamese fought the Chinese for a thousand years to gain independence, only to lose it the French.
The Vietnamese have turned the American War into a tourist attraction. Former President Diem's presidential palace in downtown Ho Chi Minh City is now open to international tourists. It's a very attractive 1960s-style building that is still used on some state occasions.
After the inglorious fall of Saigon in 1975, the Americans left humiliated. But now they are returning — some old soldiers, but also the new legions: the businessmen.
In the United States, in the wake of globalisation, entire industries are being shut down. Take furniture, for example. The furniture industry in high-cost America simply cannot compete with Asia.
In the new houses going up in McMansion style, ceilings are commonly 12 feet or more high. Traditional furniture is simply too small, requiring a new style of gigantic furnishings, and the profits can be staggering.
For example, a piece of furniture can be loaded onto a ship in a Vietnamese port for US$1,500 and then be sold retail in America for US$15,000. And the US$1,500 is not what it cost to produce — the manufacturer in Vietnam is making a handy profit, too. There's a lot of money to be made.
That begs the question — why is furniture manufacturing booming in Vietnam? Why not China, or somewhere else in Southeast Asia?
Businessmen say that Vietnam is a communist country and a lot of red tape must be negotiated before a factory opens, but once the procedures have been completed, the government leaves them alone. China is much more prescriptive, telling foreign businessmen whom they can hire, where they can build and so on.
Vietnam is said to be riddled with corruption, but businessmen say it is manageable. "If you have a machine worth a quarter of a million dollars sitting on the dock, and it'll cost you a few hundred dollars to get it delivered now instead of in three months' time, then the payment is not a major consideration," said one American businessman.
Vietnam is still very affordable for both businessmen and tourists. In the old section of Hanoi, where most tourists stay, one intersection is called the "beer corner". On all four corners sit various old ladies selling beer from the keg. The beer is amazingly cheap — less than 20 cents Australian for a big glass, meaning you can drink all night for a dollar.Knowing who's boss
Patrons sit around on stools and plastic chairs, spilling over onto the roadway. Every so often the police will drive by in a jeep. Everyone scatters, the chairs are stacked, the old ladies and the drinkers retreat. It's a game. After a few minutes, the police go and the drinkers return to their beer and the seats emerge again. But everyone knows who is boss.
If Vietnam is like Taiwan was 30 years ago, will Vietnam in 30 years be like Taiwan is today — a free, prosperous and democratic country?
Prosperous, likely. Free and democratic? Much harder to say. Vietnam, a nation of over 85 million people, is still under communist rule.
The government allows a certain amount of latitude, but cracks down hard on any person or group that questions or threatens the Communist Party's leading role.
It's true that religious believers have more freedom in Vietnam than in China and the state has better relations with the Vatican, but every so often, just as on the beer corner, the authorities come along and do enough to remind everyone who is in charge. And without a process of democratic renewal, that's the way it's likely to stay.— Jeffry Babb was until recently a Taipei-based journalist.