What has Made Viet Nam a Poverty Reduction Success Story?

Overview

Viet Nam has actively integrated into global markets since it adopted an ‘open door’ economic policy in 1986. The government has led a series of economic reforms, in conjunction with poverty-reduction policies. This has resulted in steady economic growth, while poverty rates have more than halved. This paper analyses the context and policies that have underpinned this success. Adopting a stepwise approach to reform and liberalisation of agriculture and state-owned enterprises, the government retained strong control over domestic economic policy. This control extends to relations with donors and NGOs, with good aid co-ordination and high levels of budget support. Universal education has supported the development of an educated labour force, while commitment to gender equity has enabled women to benefit from economic development. Nonetheless, civil and political rights remain weak, and there are strong pressures for increased political participation. To avoid fuelling inequalities, political reforms must address the rights of internal migrants and ethnic minorities.