THE POLITICAL ECONOMY OF CRISIS AND CONVERSION IN VIETNAM: THE BACKGROUND AND THE PROSPECTS OF REFORM LINE

Abstract

After achieving unification, Vietnam tried to build a socialist economy. The so called second Five Year Plan based on socialist developmental strategy was characterized by the collectivization of agriculture and the nationalization of industry. But the strategy which was to accomplish a economic integration by northemizing the south resulted in severe imbalance among industial sectors and economic stagnation. Thus, a new economic policy which reserves socialization and introduces capitalist incentives was executed to solve problems like these in1979. As the new economic policy resulted in rampant inflation, however, the allocation and circulation were recontroled and the collectivization of agriculture was resumed from 1983. In effect, a short-term and emergency measures could nat break throgh the economic crisis due to the failure of socialist development. Socialist developmental strategy which emphasized the self-reliant production structure did not choose an integrating but a delinking from the world economy. Vietnamese economic crisis was due to delinking strategy which were chosen before reform line. To settle the economic crisis reform line called Doi Moi searching for structural conversion was choosed together with the setting up of Nguyen Van Linh regime in 1986. Thereafter the market economy was introduced gradully. The outcomes of reform line were obtained and constructed a minimal base of develioment from the end of the 1980s. The Seventh Party Congress of 1991 reaffirmed the reform line and dicided on the direction towards market economy. Also, the revised constitution of 1992 sanctioned a multi-sectoral commodity economy based on market principle. Vietnamese trade was activated since the lifting of U.S. embargo in 1994 and the joining of ASEAN in 1995