Vietnamese State Industry and the Political Economy of Commercial Renaissance. Dragon's Tooth Or Curate's Egg?

283 Pages·2007·1.746 MB·English

by  Adam Fforde (Auth.)

Vietnamese State Industry and the Political
Economy of Commercial Renaissance
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Vietnamese State Industry
and the Political Economy of
Commercial Renaissance:
dragon’s tooth or
curate’s egg?
A F
DAM FORDE
Chandos Publishing
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First published in Great Britain in 2007
ISBN:
978 1 84334 220 5
1 84334 220 0
© Adam Fforde,2007
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Printed in the UK and USA.
To my grandmothers, who died too young:
Cicely Fforde,
née Creswell,
and
Stella Retinger,
née Morel.
And also the late Professor
Nguyen Tri.
‘Remember me, but Ah forget my fate.’
Table
4.1 Capital and output in state industry 128
xi
Acknowledgements
This study owes much to many people. It was initially financed under the
Post-doctoral Research Fellowship Scheme of the Economic and Social
Research Council, London (I held this fellowship from 1983 to 1987).
The ESRC supplied extra funds at various times for a number of
purposes: the research visit to Hanoi, hire of a research assistant during
1985 in London and purchase of a portable computer. In the nature of
things research such as this cannot be pre-programmed, and I would like
to express my thanks to members of the ESRC’s staff for their
understanding and prompt advice and assistance. Financial constraints
upon the ESRC meant that a second extension of funding could not be
supplied, so the closing months had to rely upon my own resources. I am
extremely grateful to the Department of Economics, Birkbeck College,
London, for letting me keep my room during that period.
Birkbeck provided a supportive and relaxed working environment for
which I am most grateful. In particular, I would like to thank the late
Hugh Davies and Nigel Foster for encouraging me to develop the
portable computer facilities that I used in Hanoi and subsequently, and
also for supplying the essential debugging needed to get the machinery
operating effectively. The machine itself, a laptop Data General One,
facilitated a revolution in work practices and database utilisation in the
field and as practical research tools while writing up. I would like to
record my thanks to various UK employees of the company for their
help. I would also like to thank the then acting chairman of the
Community of Refugees from Vietnam in Islington, Vu Khanh Thanh,
who worked as my research assistant in London during the summer of
1985, for his efforts.
I would like to note my debt also to the office of the National
Economics University (NEU), Hanoi, for their efforts on my behalf, and
especially to Nguyen van Khanh for his assistance and encouragement. I
owe a considerable debt to Nguyen Phap, then dean of the NEU, for his
calming hand during moments of tension and difficulty, and for his help
during my stay in 1985–1986. I need to thank Nguyen Tri, Nguyen Lang
and Pham Huu Huy for their support during the same visit, and also
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Vietnamese State Industry and the Political Economy of Commercial Renaissance
Hoang Kim Giao of Hanoi University’s Political Economy Faculty for his
help in 1978–1979. The NEU library provided valuable assistance in
finding books and pamphlets, for which I am grateful. To possess and
run a functioning academic library under north Vietnamese conditions at
that time is an achievement that should be recognised.
I would also like to thank Nguyen Ngoc Tri, curator, Vietnamese Section,
Oriental Manuscripts and Printed Books, British Library, for his help.
I would like to thank the staff, both Vietnamese and expatriate, of the
Bai Bang Mill and Plantation and Soil Conservation Projects, Vinh Phu,
for their ready acceptance of a consultant-turned-academic-turned-
consultant in their midst. I would also like to thank various staff
members of SIDA for ideas and comments over the years.
A number of colleagues at Birkbeck and elsewhere have helped me to
clarify my own thinking and reduce – or so it appeared at the time – my
own confusion. In particular, I would like to thank Melanie Beresford,
Hugh Davies, Stefan de Vylder, Nguyen Dinh Huan, Nguyen Huu Dong,
Hoang Kim Giao, Nguyen Huy, Pham Huu Huy, Nguyen Lang, Ben
Lockwood, Chris Martin, Irene Norlund, Teresa Halik (née Pajor), the
late Suzy Paine, Tran Huy Chuong, Anna Petrasovits, Nguyen Phap,
Nguyen Tri, K.-E. Wadekin, Peter Wiles, Doug Porter, Anthony Marcus
and Joerg Wischermann.
I should thank the staff of the NCDS, Australian National University,
for the facilities provided during a three-month visit in 1990 which
allowed me time to work on the study.
I would like to thank the Melbourne Institute of Asian Languages and
Societies for giving me a room and infrastructure in 2003–2005, without
which this book would certainly not have been finished.
Important parts of this work were carried out with the support of the
Australian Research Council under their Large Research Grant Scheme.
I thank Suki Allen for her help and encouragement and Gilly Robson
for her warm support. And also George Fforde for his ceaseless curiosity
and intellectual sinuosity.
I am, of course, responsible for the many mistakes that undoubtedly
remain.
Adam Fforde
Melbourne 2006
xiv
Preface:
‘That forgotten world’ – socialism,
Stalin and the plan
War or peace?
Just what was the state sector of the Socialist Republic of Vietnam (SRV)
before the market economy that emerged in 1990–1991? Was it dragon’s
tooth or curate’s egg? Was it the basis for military strength and socialist
construction, or was it something, clearly rotten, which must for various
reasons be presented as ‘good in parts’?
For traditional communists, those who believe in central planning, the
state sector is special: manned by the proletariat, the most progressive
class, and led directly by the Party through the socialist state and its
planning apparatus, it is the cutting edge of progress. In the logic of
Stalinism, for communists surrounded by hostile forces crash
industrialisation was historically necessary, not only to show the
superiority of state socialism but also to provide military strength. State
industry was the place where this was meant to happen. In communist
Vietnam, however, things were rather different. After national
reunification in 1975, targeting the scarce resources of a very poor area
upon the state sector drained the country’s energies and dashed popular
expectations of a happy peace ‘ten times better than before’, as the
economy became an arena of struggle, shortages and heavy risk.
Demobbed soldiers found in the late 1970s and on through the 1980s
that rearing their children was full of difficulties and stress. What was
promised was not delivered, either to them or to the generals who had
hoped to see construction of a military-industrial complex to buttress
Vietnam’s new national independence. This was a curate’s egg.
The contrast with the hoped-for dragon’s teeth expresses the epitome
of the state sector’s position: so much was owed to it, yet so little came
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Vietnamese State Industry and the Political Economy of Commercial Renaissance
back. But how could this happen in a nation that could defeat the USA
militarily, despite grinding poverty? And it was not that these hopes were
a nonsensical delusion, for the USSR had shown that central planning
could work, in its own terms.
In the 1920s and 1930s it was not suicidal for senior American
economists, presidents of the American Economics Association, to refer
to themselves as ‘socialist’. Nor was it thought universally insane to
think of Soviet Russia as an area where workers’ rights and interests
were respected. Similarly, in the early 1970s Americans of impeccable
liberal credentials risked their careers to support the VCP1 in its armed
struggle against the USA. Nor, given the success of Stalin’s system in
creating a military-industrial complex that could first defeat Nazi
Germany and then confront the West in its occupation of Central
Europe, was it silly to expect that a reunited Vietnam under communist
rule would rapidly create an economic and (independent) military
potential that would position it well to challenge for regional influence.
The ‘Prussians of Asia’, now granted access to the Mekong delta
breadbasket, must – surely – have been well placed to harness the power
offered by the Soviet, or rather Stalinist, programme. Soldiers, well
armed, would be expected to rise from the dragon’s teeth sowed in the
now peaceful battlefields of Vietnam. Yet this was not to be.
While many foolish things have been written, not least about Vietnam
and not just by foreigners, nobody would have dared to predict what
actually happened. For within a generation of reunification the core of
the Stalinist project in Vietnam, the state-owned enterprises (SOEs), were
to emerge into the market economy of the 1990s. Rather than going to
the wall, they often turned out well equipped, not to follow rigid plan
directives and rapidly expand social production forces, but to cope with
messy markets, a weak and often corrupt state bureaucracy, ideological
threats and privatisation doctrines from the World Bank and other
donors and, not least, severe competition from China and other SEA
countries which had engaged earlier with globalisation and modernity.
Through the 1990s GDP rose rather fast, the state share of the
Vietnamese economy rose and many SOEs created large profits for their
owners (strange coalitions of officials, managers and others).2 Foreign
investment flooded in, and by the end of the 1990s was increasingly
dominant in Vietnamese industry. Through the 1990s, although many
logics influenced the Vietnamese state, capitalism and profit were central
concerns. This was a commercial renaissance.
Vietnamese state industry had turned out, like the curate’s egg, to be
‘good in parts’, but, in traditional socialist terms, essentially rotten. In no
xvi