Vietnam: from battlefield to development model

Vietnam has inspired the world with its resistance to imperialism and the dogmas of economic liberalism that plague the working class around the world. Under the communist regime, the country became a global reference in eradicating hunger by reducing the poverty rate from 70% in 1975 to less than 3% in 2022.

After defeating major world powers in two wars – first against France, in the War of Independence, and then against the United States, in the Vietnam War – the country emerged as a symbol of determination and recovery, using the socialist model.

Data from the World Bank reveals that, from 1992 to 2020, Vietnam lifted more than 30 million people out of poverty. The number of people living on less than US$2.15 a day fell by 98%, from 31.5 million to 600,000, during a period in which the population grew by almost 40%, to 96.7 million.

Cost of living

From 1992, when it began producing the current historical statistical series on poverty, to 2020, the most recent number available, Vietnam lifted more than 30 million people out of poverty, according to the World Bank. The number of Vietnamese living on less than US$2.15 a day, in 2017 values ​​adjusted for the country’s cost of living, fell by 98%, from 31.5 million to 600 thousand, in a period in which the population grew by almost 40 %, to 96.7 million.

In relative terms, the number living in poverty also decreased considerably, from 45.1% of the population to 0.7% of the total. “Vietnam has led the way for lower middle-income countries to achieve rapid and sustainable poverty reduction,” says a UN report on the topic, published in 2023.

The country also celebrates other achievements achieved in the social field. The mortality rate for children under 5 has more than halved since 1990, from 52 per thousand births to 21, according to World Bank data. At the same time, between 2000 and 2022, basic sanitation services, which were offered to 50% of the country’s inhabitants, now reach 92%

The Vietnamese government adopted strategies that combined centralized planning and pragmatic reforms to boost economic growth and improve the population’s quality of life. The turning point began with Doi Moi (“renewal”), an economic reform policy initiated in 1986.

Unlike neoliberal transitions in other countries, Vietnam has not given up state control over strategic sectors such as land and natural resources. Instead, it decentralized agricultural production, allowing peasants to cultivate and market their products, while the state continued to regulate the market and ensure the redistribution of wealth.

This model allowed Vietnam to transform itself into an agricultural power, especially in the production of rice and coffee, becoming one of the world’s largest exporters of these products. This ability to generate wealth was crucial for financing social programs, expanding access to health and education, and improving basic infrastructure in urban and rural areas.

Investment in health and education

Another pillar of Vietnamese success has been continued investment in public health and universal education. Since independence, the government has prioritized policies to eradicate illiteracy and ensure that all children have access to school. Today, the literacy rate in Vietnam exceeds 95%, and the education system is recognized as one of the most efficient in Asia.

In the health field, the implementation of public policies focused on disease prevention and universal access to medical services has resulted in significant advances. In addition to drastically reducing infant mortality, the country managed to increase the life expectancy of its population to 73 years – a number comparable to that of developed countries.

Resilient and inclusive economy

Despite the difficulties imposed by economic sanctions in the 1980s and 1990s, Vietnam diversified its economy, attracting foreign investment in sectors such as manufacturing and technology. But unlike countries that have given up their sovereignty in exchange for foreign capital, Vietnam has maintained a model in which state-owned enterprises and cooperatives play a central role in economic development.

This approach avoided the devastating effects of financialization that affect many developing nations, such as extreme inequalities and deindustrialization. In Vietnam, economic growth went hand in hand with the reduction of inequalities, showing that it is possible to prosper without succumbing to neoliberal prescriptions.