Poverty in Vietnam continues to fall, particularly amongst ethnic minorities, who saw their rate of poverty decline significantly by 13 percentage points, the largest decline in the past decade, says a new World Bank report.
According to Climbing the Ladder: Poverty Reduction and Shared Prosperity in Vietnam, released today by the World Bank, improving income from highland agriculture can help Vietnam further reduce poverty, which has fallen by almost 4 percentage points since 2014, to 9.8 percent in 2016. Ethnic minorities – many of them living in highland areas – account for 72 percent of Vietnam’s poor, and encouraging them to grow more profitable industrial crops may improve their earnings.
“Vietnam has achieved tremendous results in reducing poverty and improving the quality of life for millions. The decline in poverty amongst ethnic minorities is encouraging, and more focused efforts on improving their incomes can further broaden their opportunities and reduce persistent inequalities,” said Ousmane Dione, World Bank Country Director for Vietnam. “The aspirations of those with less opportunities cannot be ignored.”
Outlining recent trends and patterns of poverty in Vietnam, the report proposes solutions for that untapped agriculture potential in highland areas where the poor are concentrated. Land use and cropping decisions, for example, contribute more to agriculture income differences between households. Low-income families in highland areas use their land to grow basic crops such as rice or maize instead of raising more profitable crops such as coffee, black pepper, or rubber.
Improving access to credit may help highland farmers make the necessary investments for higher-earning agricultural production. Strengthening earning capacity can help narrow inequalities between groups. The average per capita consumption of ethnic minorities, for example, remains less than 45 percent of the Kinh and Hoa. Moreover, the poor faces a widening gap in terms of access to upper secondary education and improved water and sanitation.
At the same time, the report recognizes that 70 percent of Vietnam’s population is now classified as economically secure, including the 13 percent who are now part of the global middle-class. These income classes are growing rapidly, rising by over 20 percentage points between 2010 and 2017. An average of 1.5 million Vietnamese joined the global middle class each year since 2014, confirming that households continue to climb the economic ladder after escaping poverty. The rise of the consumer class changes society’s aspirations and the focus of the poverty and shared prosperity agenda shifts from combatting extreme poverty to effecting broad improvements in the quality of life and supporting the further expansion of the middle class. Rapid job creation and an ongoing transition to wage employment are driving gains in poverty reduction and shared prosperity.
The report suggests several areas of strategic priorities to further reduce poverty and promote shared prosperity, including:
- Boosting labor productivity and investing in infrastructure to sustain job creation and wage growth without losing competitiveness.
- Implementing education reforms designed to equalize opportunities and develop workforce skills.
- Spurring agriculture structural transformation through changing farmland use patterns, strengthening land user rights, and improving skills of the poor farmers.
While reducing inequality remains a challenge, the report notes that the number of individuals vulnerable to falling back into poverty declined to only 2 percent between 2014 and 2016. In contrast, the period saw the middle class expanding by more than 3 million people.
One of the prioritized areas under the new World Bank Group Country Partnership Framework with Vietnam for the period from FY18 – FY22 is inclusive growth, with a specific objective for the “economic integration of the poor and vulnerable groups” under which the Bank will provide support for targeted interventions to expand economic opportunities for people in lagging areas.
Vietnam-US relations and the US-ASEAN Summit
Vietnamese Prime Minister Pham Minh Chinh visit to US should be seen from the point of view of the engagement between Vietnam and US. At the same time US has been making extra efforts to engage the ASEAN countries in the larger geopolitical dynamics. During the visit of prime minister Chinh discussions were on security issues and the scourge of COVID-19 pandemic. Vietnamese PM Chinh met President Joe Biden and informed that Vietnam is on its way to recovery and the unemployment rate within Vietnam has dropped to nearly 3.6 per cent. US has been involved in Vietnam in a number of initiatives which includes infrastructure projects, providing medical aid to the victims of Agent Orange, trade and investment in Vietnam and also working towards developing Vietnam as the Centre for a medicine research and diagnostics.
In the past six years the last two presidents of US visited Vietnam including President Barack Obama and President Donald Trump. President Biden has stated that he has a special place for Vietnam and Vietnam has all the potential to emerge as an important country in areas such as digital economy, resilient supply chains, research in energy efficiency, climate change mitigation, and vocational training. In the last two years Vietnam economy has gained a number of foreign direct investors primarily of its latent economic potential and also the anti-corruption measures which have been undertaken by the Vietnamese Communist party general secretary Nguyễn Phú Trọng.
During his interaction with Prime Minister Chinh, President Biden stated that under the democrats the US politicians have tried to promote cordial relationship with Vietnam. He also stated that Vietnam as a middle power country has a lot of potential in areas such as investment, trade, development, disease prevention and control, and working on developing health infrastructure. During the ASEAN summit meeting in the year 2021 President Biden has stated that U.S. Congress would allocate USD $ 21 billion so as to support infrastructure development and institutional networks to counter pandemic and develop COVID-19 vaccines and drugs. US has also provided diagnostics and medical equipment so that the developing countries should respond to future pandemics and protect their citizens in Southeast Asia because the epicentre of economic growth is likely to shift to the Indo-Pacific region.
During the discussions, the Vietnamese Prime Minister Chinh stated that US would be very helpful in developing Vietnam’s green circular economy and also help in sustainable energy transition while looking for alternate sources of energy. Vietnamese Prime Minister also made a strong pitch for US to actively intervene to protect territorial integrity and maintain peace in the contested regions. Few countries should refrain from the use of force, and peaceful settlement of disputes through dialogue and discussion should be adopted. This would ensure freedom of navigation and overflight as per the charter of the United Nations Convention on The Law of The Seas 1982(UNCLOS).
Vietnamese Prime Minister Pham Minh Chinh attended a reception hosted by US National Security adviser Jake Sullivan on May 13. Vietnamese Prime Minister made a strong pitch for the efforts of the US National Security Council and stated that the US administration has a strong commitment for regional peace and security. He added that in recent years the normalised trade relations between Vietnam and US have opened new avenues for growth, exchange of ideas, and regular dialogues at the highest level. He stated that the visit of the party general secretary to US in 2015 was a milestone and offered new avenues for interaction between the two sides. The Vietnamese Prime Minister also confirmed that US is seen as one of the important partners and offered to work jointly on areas which promote peace, stability, corporation and development in the region.
One of the interesting aspects related to the interaction between the two leaders was US offer to help Vietnam in alleviating the consequences of the second Indochina war and supporting Vietnam’s efforts to emerge as a self-reliant economy. The two sides acknowledged that there is a need for technological and digital transformation across the world and also supporting the diversification of supply chains and commitment towards climate change responsibilities. The US President Biden also stated that US acknowledges the sovereignty and territorial integrity of Vietnam. He stated that there are different political systems. Vietnam has been very successful in overcoming challenges related to COVID-19 pandemic and depleting exports which has happened during the pandemic.
In his interaction with US Secretary of State Anthony Blinken, Prime Minister Chinh acknowledged that 40 million vaccine doses which were supplied by the US government were very handy in containing the pandemic and laid the groundwork for protecting the citizens of Vietnam. He acknowledged that Vietnam and US comprehensive partnership is the foundation stone for political interactions, cooperation and development in the region. Antony Blinken openly stated that US supports a strong, independent and prosperous Vietnam. Acknowledging the role that Vietnam has played under the COP 26 climate change initiative, the US side stated that it will be providing technical expertise in implementing the obligations under the United Nations Climate Change Conference of the Parties (COP 26). Anthony Blinken also buttressed the importance of peace, freedom and security for navigation and aviation in the East Sea, and instead of using South China Sea; the use of the term is itself was a big support to Vietnam.
Under the US-ASEAN summit which outlines the four and a half decades of interactions between the two sides where there is an equal respect for ASEAN centrality and US has clearly stated that ASEAN remains a basis for trust, inclusive regional security architecture, respect for international law and is one of the forums for building an open and inclusive regional multilateral dialogue. US has clearly stated that the Vietnamese Prime Minister has taken strongly buttressed resolution of differences and disputes by peaceful measures as per the provisions of the international law, UN charter, and the signatories of the Treaty of Amity and Cooperation (TAC) in South East Asia should acknowledge the role that this treaty has played.
The US ASEAN relationship also needs to work on trade and investment flows in the aftermath of the pandemic. Vietnamese Prime Minister Chinh stated that US should support ASEAN in sustainable development, restructuring of economic architecture technological support and building renewable energy as well as sustainable recovery for these nations. On the issue of non-traditional challenges, there is a need for consensus and acknowledging the statement which was given Vietnamese PM Chinh during the maritime security summit undertaken by India during its chairmanship in UN Security Council. The Vietnamese side has stated that UN should take a leadership role in resolving the regional security issues. Few of the other areas which US and Vietnam has explored is related to regular interactions between the business communities of the two sides and explore opportunities in areas such as education, infrastructure, and administrative reforms. The Prime Minister also stated that Vietnam acknowledges that economic, trade, financial, and investment relationships with US would boost its standing at international level and bring about better avenues for growth and developing Vietnam economy.
During his speech which he made at the Centre for strategic and International Studies Prime Minister Chinh stated that in the last 27 years of the normalization of relations between the two sides four consecutive US presidents have visited Hanoi and showcased that the two countries can work together. He also stated that Vietnam is aspiring to be a middle income industrialised developing country in next five years, and fulfil the aspirations of the people by becoming a modern industrial country with the upper middle income by the year 2030. He also proclaimed that Vietnam consistently adopts an independent and self-reliant foreign policy, and is responsible stakeholder in the international community.
The Prime Minister also stated that on the Ukraine issue Vietnam is willing to join hands with international community to find long term and sustainable solution to resolve the crisis. Vietnam has also provided humanitarian aid of 500,000 U.S. dollars for Ukraine. Vietnam is also one of the financial contributors to the COVAX programme and has supplied mask and medical supplies to more than 50 countries across the world.
US has always supported ASEAN for improving its production and manufacturing capacity, healthcare institution and sharing of best expertise in vaccine production. The issues related to environmental degradation and climate change along with support for blue economy were points of discussion between US and ASEAN nations.
More importantly President Biden has stated that US will be donating US $150 million to the organization so as to promote private sector investment, healthcare, maritime cooperation and infrastructure development along with other sectors of importance. The two sides also discussed synergies which can be explored between Asian centrality and the ASEAN outlook on the Indo Pacific. The relationship between the two sides have opened up in the last 45 years and it is expected that on issues such as maritime security, and developing coordinated response mechanism to non-traditional security challenges the two sides can work more often.
Despite the summit meeting between ASEAN and the US being postponed earlier, the final summit meeting provided good outcomes particularly in relations to US acknowledged ASEAN position on Ukraine and also accepted that the political institutions within ASEAN have worked wonders in terms of providing support to their citizens during the pandemic. Vietnam has been actively promoting the role of ASEAN in the regional setup and Prime Minister Chinh also outlined that Vietnam’s foreign policy is independent and sincere.
Vietnam and India relations are also going to grow given the fact that Vietnam and US are working on the comprehensive partnership and also might be seen the strategic partnership agreement between the two in future. However, in terms of peace and stability in East Sea as well as adjoining areas Vietnam has made a strong pitch with regard to getting the international community on board and abhorring any kind of threats or use of threat in the contested waters.
The visit of Vietnam’s Prime Minister Chinh to the US has been very successful after the visit of party general secretary in 2015, and it clearly shows that the Vietnamese Prime Minister has been making extra efforts to help Vietnam recover from pandemic after effects and build a middle-sized income country with a higher income by the year 2030. The aspirations of Vietnam to become an industrial economy by 2045 would require support from the European nations and the US so that better avenues for exports technology upgradation investment and development of entrepreneurial capacity would help the country to reach its goal.
ASEAN as the Key Ground of Competition in U.S.-China’s Indo-Pacific Strategies
With U.S. President Joe Biden’s visit to Asia scheduled for later this month, Japan’s ambassador to the U.S., Koji Tomita, stated on May 9 that the latter may officially launch a new American economic strategy for the Indo-Pacific region when he shuttles in Japan during his tour. The new economic strategy referred to here is the Indo-Pacific Economic Framework proposed by the Biden administration on October 27 last year at the 16th East Asia Summit.
Biden had claimed that it will define the “shared objectives around trade facilitation, standards for the digital economy and technology, supply chain resiliency, decarbonization and clean energy, infrastructure, worker standards, and other areas of shared interest”. The framework is extremely broad, covering multiple emerging and non-traditional economic sectors.
In the past, the United States focused on security and defense capacity building in its strategy in the Indo-Pacific region, with the establishment of security alliances like the trilateral security pact between Australia, the United Kingdom, and the United States (AUKUS), the Quadrilateral Security Dialogue (QUAD), and the Five Eyes alliance. In addition, it carried out frequent military exercises with countries like the Philippines and Singapore. Comparatively, the U.S. strategy in the economic field is relatively weaker. This is especially true given its 2017 withdrawal from the Trans-Pacific Partnership (TPP). Its economic strategy in the region appears to have vanished since then. If the new framework is used as a geo-economic tool to increase its influence in the region in order to contain and weaken China’s influence, it is consistent with the United States’ Indo-Pacific and global strategies.
The Indo-Pacific Economic Framework includes Japan and South Korea in East Asia as American allies. They are part of Washington’s spheres of influence. India, a major South Asian country with global ambitions, is also the largest ally the United States seeks in Asia. For the U.S., India is one of the important support bases in this strategy. The other key area for the U.S. in its push to achieve a large strategic alliance is the ten ASEAN countries located in the Western Pacific. It is even possible to argue that the attitude and participation of ASEAN countries in this plan will determine, to a large extent, the United States’ success or failure in promoting this Indo-Pacific economic strategy.
When speaking at the CSDS-CSIS Transatlantic Dialogue on the Indo-Pacific on May 9, National Security Council Indo-Pacific Coordinator Kurt Campbell stated that the most important message from Biden’s visit to Asia in late May will be that this is an urgent task to be accomplished in the wake of the current crisis in Ukraine. He insisted that the greater fundamental challenges of the twenty-first century lie in the Indo-Pacific region.
Campbell said that at the beginning of the Biden administration, the Indo-Pacific strategy mainly focused on cooperation with partners in the region. Now the U.S. and European partners also have intensified contacts and dialogues on Indo-Pacific affairs. With the crisis in Ukraine, the U.S. was widely expected to turn its attention to Europe, leaving little attention to the Indo-Pacific, but the opposite is true, said Campbell. He noted that the Indo-Pacific region’s unprecedented broad commitment to Ukraine reflects the fact that some of these countries see Ukraine as a “cautionary tale” and do not want similar military operations to take place in the region. This, in turn, prompts a great deal of strategic thinking.
Notably, Campbell declared that his most important responsibility as the Indo-Pacific Coordinator is to ensure that the framework is more synergistic among leaders in Asia, Europe, and the U.S., that they will consider the action plan for implementation. He hopes the U.S. and Europe will “seize this opportunity, probably the next couple of years, because we do not know how long it will last”. Now the U.S. intends to work with Europe on matters with global consequences, not only on the Ukraine issue but also on future Indo-Pacific strategies and tactics.
Researchers at ANBOUND point out that the war in Ukraine has expanded the U.S. definition of the Indo-Pacific strategy and economic framework, and that it is utilizing the war to strengthen the window period for U.S.-European relations. Simultaneously, the U.S. is also leading its European allies that geographically belong to the Atlantic partnership to support the Indo-Pacific strategy. With such an effort, the United States hopes it will be able to unite as many allies and partner countries as possible, impose its influence and even dictate the international political and economic affairs in the region. This should allow it to effectively restrain China, its perceived major strategic competitor.
According to ANBOUND’s researchers, the framework is an attempt by the U.S. to establish a more diverse communication and cooperation with the Western Pacific region through economic collaboration. ASEAN nations are expected to play a crucial role under such a mechanism. What is certain is that China and the U.S. will center their game around ASEAN as the U.S. promotes its Indo-Pacific economic strategy. We believe that in the future, the key to the broader game between China and the U.S. in the region lies in ASEAN. For China, ASEAN is not only geographically close, with some of these countries being neighbors, but it is also China’s largest global trading partner, with increasingly closer ties. If the U.S. does not include ASEAN in its Indo-Pacific strategy and economic framework, there will be a huge gap. The same is true for China. If China cannot maintain close economic ties and stable geopolitical relations with ASEAN, China will become rather a passive onlooker in the global geopolitical game in the future.
Visit of Vietnam’s PM Chinh to US for US-ASEAN Summit
Vietnam’s Prime Minister Pham Minh Chinh left Hanoi (May 11) to visit US and hold meetings with US President Joe Biden. The meeting between the two leaders is expected to discuss issues related to health, climate change, renewable energy, sustainable development, and Indo-Pacific Economic Framework. Over a period of time the relationship between US and Vietnam has improved and US has been taking active interest in developing the ecosystem of health, human security and developing maritime security architecture. Even though US and Vietnam are seen as comprehensive partners but are still short of becoming strategic partners. US has time and again stated that it respects Treaty of Amity and Cooperation as well as ASEAN centrality in the Indo Pacific architecture. Vietnam has been seen as one of the promising economies in South East Asia with GDP growth rate expected to be anywhere between 6 to 8 per cent and Vietnam is also willing to explore possibilities with cooperation on science and technology, artificial intelligence, and research on medicine.
According to the Indo Pacific Strategy document, released by the US in February 2022, the US has made sure that ASEAN as an organization remains a leading regional institution and its centrality in the larger security dynamics is maintained. Given the fact that the two sides United States and ASEAN would be celebrating 45 years of dialogue relationship and the strategic partnership which was signed between the two sides in 2015. The areas of cooperation are bound to expand.
During the last meeting in 2021 which was held online it was clearly stated that US is interested in developing diagnostics, biomedical research, promoting science and technology innovation and connectivity within the Southeast Asian region. Issues related to public health, economic recovery, promoting employment and developing digital infrastructure were discussed in the last meeting between the two sides.
One of the important elements which has seen much attention from Southeast Asian countries is related to the Indo Pacific Economic Framework. Even though Regional Comprehensive Economic Partnership has been implemented and is being seen as one of the biggest regional economic groupings while on the other hand the Comprehensive and Progressive Transpacific Partnership (CPTPP) which includes Brunei, Malaysia, Singapore and Vietnam is also trying to revive the possibilities of trade and investment between the participating members. In order to offset its withdrawal from the TPP, the US is trying to develop a wide-ranging agreement related to digital economy and ecommerce. During the COVID-19 pandemic the ecommerce has grown multiple times and he is seen as the future of marketing and investment.
When one looks into Vietnam and US relationship it can be acknowledged that the new Ambassador of US to Vietnam Marc Knapper has been proactively engaging the high-level officials and also looking for ways and means to promote cooperation between the two sides. Vietnam has also seen high level official visits by vice president Kamala Harris Secretary of Défense Lloyd Austin, and also the previous two presidents of US have visited Vietnam particularly President Obama and President Trump. Even though president Trump visited Vietnam to hold bilateral talks with North Korean Kim Jong Un but he did looked into possibilities of exploring better relationship with Vietnam. During the ASEAN chairmanship in 2020, Vietnam has undertaken a major overhaul of the ASEAN structure particularly with regard to integrating the medical research, health institutions, and promoting cooperation within the region for diagnostics and treatment so that the population in Southeast Asia could benefit from latest technology and developments in medical research. Vietnam has also been proactive in supporting ASEAN for the three pillars – politico- security community, economic community and social cultural community, the future community building exercise.
US acknowledges that to harness the potential of the Southeast Asian countries it is important to develop few critical areas such as human resource development, resilient supply chains so that in case there is a disruption in supply chains primarily from China, then the countries from Southeast Asia can offset that deficit and developing infrastructure. Lately with the developments in Cambodia particularly related to Chinese that diplomacy and development of the Ream naval base, US is much interested in developing Vietnam as one of the cornerstones of its Southeast Asia policy. There is huge possibility for development of Mekong River catchment areas and smart agriculture. This will take care of the vagaries of climate change and the rise in global temperature given the fact that the impact will be very huge on the rice fields in the whole of Southeast Asia. Vietnam has also undertaken leadership positions in APEC, ASEAN and had even a very action-oriented strength as non-permanent member in the UN Security Council.
As it has been seen in the past US wants to diversify its supply chain and promote research related to COVID-19 and similar pandemics. US and Vietnam would be discussing issues related to biomedical research vaccines, biotechnology and development of low-cost vaccines for the larger population in the developing countries. Us is also interested in promoting cybersecurity and space research with select countries in South East Asia. President Biden is also expected to discuss issues related to Russia Ukraine war and how Southeast Asian countries can help in developing a free and open Indo-Pacific. The issues which also will be discussed will be related to Myanmar and the forthcoming ASEAN summit later this year. ASEAN as an organization is also required to work and respond to president Joe Biden Indo Pacific strategy end develop necessary structures for comprehensive economic growth, connectivity, people to people linkages and working on futuristic technologies.
Earlier also when the party general secretary Truong through visited US it was seen as a major tectonic shift in the bilateral relationship between the two sides. Over a period of time the ties between the two sides have improved when US lifted economic sanctions and adopted the Permanent Normalization of Trade Relations (PNTR) in the year 2007 and subsequently the visit of the high-level leadership to Vietnam also buttresses the fact that US wants to diversify its investment and promote trade with countries like Vietnam which has a thriving economy and also has potential for growth.
Vietnamese entrepreneurs are also trying to harness the potential and given the liberal measures adopted by the party, Ho Chi Minh City and adjoining areas is likely to become a major real state hub with the development of export processing zones, software technology parks and also establishment of training institutions as well as educational hubs. Vietnamese diaspora in the US is also a prosperous community and they have been supporting the cause of their nation.
Vietnam also looks towards US for investment and also the bilateral trade and investment which can help Vietnam to explore U.S. markets as well as develop defence relationship. Even though Vietnam is very concerned with regard to larger geopolitical imprint of China in the region but it doesn’t want to engage US as an alliance or a treaty partner in defence and strategic domain. This balanced approach adopted by Vietnam has at times help in diffusing the tensions between the China and US in contagious regions. While China has imposed the three month fishing ban starting from May 1st ,it is expected that Witham along with other countries would ignore this unilateral fishing ban imposed by China. In this context countries like US which can offer group sails as well as select exercises with the interested countries would help in maintaining international order at sea.
Food insecurity threatens societies: No country is immune
“When war is waged, people go hungry,” Secretary-General António Guterres told the Security Council on Thursday during a debate on...
U.S. Violates Its Promises to China; Asserts Authority Over Taiwan
As Werner Rügemer headlined on 28 November 2021 and truthfully summarized the relevant history, “Taiwan: US deployment area against mainland...
How functional medicine can transform your life
With an increased focus on functional medicine and lifestyle changes to prevent diseases, the market for global functional medicine is...
New Resilience Consortium to Forge Strategies for Recovery and Growth in Face of Multiple Crises
COVID-19, climate change and, most recently, the war in Ukraine and the ensuing refugee crisis, are the latest reminders of...
First international day spotlighting women working in the maritime industry
The first ever International Day for Women in Maritime kicked off its inaugural celebration on Wednesday with a seminar to...
The small things make a big difference in the science of measurement
Scientists must make ever more sophisticated measurements as technology shrinks to the nanoscale and we face global challenges from the...
Putin’s House of Cards: What will happen to Russia’s satellites if his regime falls?
The war in Ukraine has astonished even knowledgeable observers, impressed by Ukraine’s valor and ingenuity and by the Russian military’s...
Middle East4 days ago
Iran Gives Russia Two and a Half Cheers
Intelligence4 days ago
New ISIS Strategy and the Resurgence of Islamic State Khorasan
International Law4 days ago
Russia-Ukraine War, China and World Peace
East Asia4 days ago
When Will They Learn: Dealing with North Korea
Africa4 days ago
African Development Bank Seeks U.S. Support to Alleviate Africa’s Food Crisis
Economy3 days ago
The Return of Global Inflation: A Threat to Our Interdependent World?
Energy3 days ago
Kurdistan – Britain Ties in New Momentum Driven by Energy Supply
Tech News3 days ago
Privacy vs Security in the online world