May 9, 2017    5 minute read

How Vietnam Is Moving into the Future, One Scooter at a Time

A Bright Future    May 9, 2017    5 minute read

How Vietnam Is Moving into the Future, One Scooter at a Time

There are nine million people in Hanoi and some four million scooters, which are the primary mode of transportation. They create a very distinct mood while also subtly suggesting much about the politics and economics of the nation.

Politics and Urban Development

Vietnam is a communist country. CINO (“communist in name only”) may be a better description. There is only one party to choose from, so participating in the political process is more like joining a club and becoming an officer. The economy, however, feels very capitalist. Hanoi is a great example.

 

The Vietnamese government discovered the libertarian principle of subsidiarity, which holds that matters should be decided at the level closest to where they can be effectively resolved. In the case of Hanoi, while it was impossible for a central government to provide a solution for all housing issues, the resources to do so existed abundantly at the level of the individual actual or prospective homeowner and the construction businesses ready to make a profit by serving their needs. Provided minimum standards were met, the government would provide services. By allowing ‘nature’ to take its course and providing a relatively light touch regulation, homes were built, services provided and slums were avoided.

An interesting feature of development in Vietnam is the role of taxes in shaping urban development. Because property taxes were levied on the width of property frontage to the street, buildings are noticeably narrow, go back a long way and then widen out. In other words, tax policy heavily influenced architectural style. This phenomenon is not unique to Vietnam: the window tax in the 18th and 19th centuries in England, France, Ireland and Scotland resulted in buildings with bricked up window spaces ready to be glazed at the point when the tax was repealed.

Transition to a Mixed Economy

Vietnam has undergone many transitions in its journey to one of the world’s fastest growing economy. According to a forecast by PricewaterhouseCoopers in February 2017, Vietnam may be the fastest-growing of the world’s economies, with a potential annual GDP growth rate of about 5.2%, which would make its economy the 20th-largest in the world by 2050.

A journey from Hanoi to the coast at Ha Long Bay reveals a mixture of villages where rice can be seen drying by the side of the road (yes, scooters do run over it sometimes, but it gets washed subsequently), towns with water mains being installed in front of the typical mix of shophouses (a car repair shop next door to a nail parlor) and larger towns with large factories run by companies such as Foxconn or Canon as the main employers.

The traditional communist central planning with its five and ten year plans still exists, but the gradual evolution toward a mixed economy has swept away much of the communist ideology from daily business life. For a visitor seeking to discern some pattern in the development of the various pieces of the economy seen in the progress from village to town to city, there are few clues. The overwhelming impression is that, while the streets are teeming with restless energy, the path, like that of the many scooters, is somewhat haphazard.

Ho Chi Minh’s Cult of Personality

Even Vietnamese tour guides are educated, consistent with the intention of the Communist Party of Vietnam, in the virtues of Ho Chi Minh as a great leader and father of the nation. His humility in refusing to occupy the impressive house used to receive foreign heads of state (he chose a nearby hut on stilts) is a staple feature of the tour guide narrative and parallels Pope Francis’s decision to live in the Vatican Guesthouse rather than the papal apartments in the Apostolic Palace.

Ho was certainly impressive in many respects. He spoke Russian, French, Cantonese, Mandarin and English in addition to his native Vietnamese. He travelled widely as a ship’s hand in his youth and spent time in France and Russia. His political philosophy, Ho Chi Minh Thought, though based on the teachings of Marx and Lenin, incorporates other strands of thinking and is believed by some in Vietnam to be a cover under which non-socialist ideas are smuggled into the economy without undermining the socialist legacy.

While there is some recognition that Ho is less popular in parts of the south of Vietnam and among some Vietnamese living abroad, it is hard to get an unbiased view in a country that still forbids critical writing about him.

Political History and Its Social Residue

Vietnam was in the grip of war with the United States for about nine years, under French colonial rule for ninety-six years and in a struggle with the Chinese for much longer. Half its border is with the South China Sea; the rest with Cambodia, Thailand, Laos and China. It occupies a strategic position in South East Asia. No doubt this is responsible for its interest to foreign powers. Since independence in 1975 and the fall of the Soviet Union (Vietnam was a member of COMECON), Vietnam has been allowed to get on with the business of planning its emergence as a sovereign nation.

There is no sense that there is a resentment of foreign influence. The population is ninety-one million, 25% of which is under the age of fourteen and is growing at over one percent per annum. The country looks forward and never backwards.

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