Gap grows between Vietnam's haves and have-nots
HO CHI MINH CITY - Up until recently, economists saw no great difference
in
individual incomes in Vietnam - as could be expected in a socialist
country.
But now a report released by the National Center for Social Sciences and
Humanities (NCSSH), in cooperation with the United Nations Development
Program (UNDP), says there is a fast-growing gap between haves and
have-nots
in this country of 78 million people.
"This trend presents a potential future social challenge for policy
makers
in Vietnam," says Robert Glofcheski, a senior economist with UNDP
Vietnam.
New UNDP resident representative Gordon Ryan also says that the emerging
challenge for Vietnam today is to maintain equality. "The rising gap
between
rich and poor should not be considered a necessary evil to help enhance
economic growth because the ultimate goal of development is people's
overall
well-being, " he says.
Before the report's findings were made public recently, the country's
officials had been confident that if Vietnam's so-called "inequality
rate"
was growing at all, it was doing so slowly. After all, surveys conducted
by
the General Statistics Office in 1993 and 1998, using expenditure data,
showed that during this period, the Gini coefficient increased slowly
and
modestly from 0.330 to 0.357. (In using the Gini coefficient, zero
represents perfect equality and 1 perfect inequality.) But the new
report
says that Vietnam's Gini coefficient has risen from 0.350 in 1995 to
0.410
today, just above the level of China, which has a Gini coefficient of
0.404.
Economists here note that these numbers not only prove that income and
development disparities have jumped significantly in Vietnam, but also
that
this country appears to be reaching such inequality much more quickly
than
China. This has taken place even as Vietnam was posting strong economic
growth in the past decade. Indeed, from a country that found it hard to
feed
its growing population some 10 years ago, this Indochinese nation has
developed into the world's second-largest rice exporter. Living
standards
have also improved tremendously.
But economists remark that the growth could be better if the gains had
been
shared more evenly across different groups in the population and
geographical regions of the country. According to these experts, while
the
growth has benefited rich and poor alike, those who were well off to
begin
with ended up with more gains. In 1999 alone, the richest 20 percent of
the
population earned 7.3 times as much as the poorest 20 percent.
Between 1995 and 1999, 31 of Vietnam's 62 provinces have also seen
income
inequality increase by 10 percent. In the meantime, there were only nine
provinces with inequality narrowed slightly over this period. The wealth
gap
is more noticeable between urban and rural areas, as well as between
major
cities and remote towns. In truth, while the urban population has
enjoyed
consistent economic growth since 1998, farmers' incomes have been
greatly
affected by continuous natural calamities and price fluctuations.
"Each year, we must buy fertilizers and chemicals at higher prices and
sell
our rice cheaper and cheaper," grumbles Le Van Nam, a 48-year-old farmer
in
Dong Nai province. "People become richer in Ho Chi Minh City while us
farmers become poorer and poorer."
The gains enjoyed by the urban population, however, are not limited to
such
things as increased income per capita. Other development indicators such
as
school enrollment, life expectancy, the unemployment rate and access to
basic social services show that in many urban areas, residents are doing
better in other areas than their compatriots in the countryside.
Economists
further point out that places with better human development indicators
can
only benefit more from economic growth. In other words, things can only
get
better for the people in these areas.
Says NCSSH deputy director Do Hoai Nam: "High human development tends to
lessen inequality. The higher human development is, the less severe is
inequality."
Economists, though, say economic gains do not automatically translate
into
improved human development. In the Mekong Delta provinces, for instance,
a
majority of the population have seen an increase in their incomes in the
past several years, while keeping the gap between rich and poor there at
a
minimum. But all of the residents in these places still suffer from
inadequate provision of clean water and basic sanitation and remain
highly
vulnerable to natural disasters and market fluctuations.
Still, they are better off than those living in less developed provinces
such as highland provinces of Kon Tum in the center, and Lai Chau and
Lao
Cai in the north. Both economic development and human development are
low in
these areas and their rich and poor share the burden of dismal basic
education and sanitation, primary health care and infrastructure, as
well as
obsolete means of production.
Vietnamese policy-makers now think that by promoting both economic
development and human development, they will gradually narrow the gap
between rich and poor. But they also realize that the varying
circumstances
from province to province mean fashioning different policy approaches
for
each area. That is why in the major cities of Hanoi and Ho Chi Minh
City,
the focuses are on boosting production, protecting the environment and
fighting "social evils".
In contrast, in the remote regions - central and northern highlands,
Mekong
and Red River deltas - official efforts are geared more toward
developing
off-farm activities and convincing people to adopt hygienic practices.
By Tran Dinh Thanh Lam - Inter Press Service - April 10, 2002
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