Vietnam and Asean

Vietnam economy and its approach to ASEAN integration
By Kwan Ming Wei, U081988X

What are major national objectives and developmental challenges of the country?

      Vietnam has been nicknamed the lone tiger of Asia when it comes to its development story (Robertson, 2007).   This is a country that emerged strongly despite going through the First, Second and Third   Indo-China War, and the Cambodian Vietnamese war which left her economically more barren than before. The late liberalisation of Vietnam worked coincidentally in favour, as the untapped market was relatively more attractive than the more matured economies of Singapore and Hong Kong. Vietnam aimed to reduce poverty and increase economic growth in the 1980s through the policy of Doi Moi (“renovation”). This involved the replacement of central planning with a regulated market economy. Vietnam achieved respectable success within a span of 15 years from 1990-2005, a consequence of the realization of their national objectives.
      “Poverty was reduced from about 75% of the population in 1984 to 58% of 1993 and 37% in 1998”( Glewwe, Agrawal, & Dollar, 2004, p.7.). Vietnam has achieved poverty reduction and increased growth from 1990s to the present date hence the next challenge is to sustain growth.
      The number of poor households in Vietnam in early 2001 still accounted for over 17 percent (or 2.8 million) of the population” ( Glewwe, Agrawal, & Dollar, 2004, p.7.). Vietnam’s strategy of eliminating poverty is through economic growth, as mentioned in the Comprehensive Poverty Reduction and Growth Strategy (CPRGS) (Phan, 2002). The government feels that economic growth is a means of generating resources to tackle poverty; hence they were quick to embrace an economy oriented approach to increase the standard of living. Although complimentary education systems and aids were introduced, the economy was given the highest importance as the government believed in the trickle down effect.