The Internal Problems of Vietnam as Cause and Consequence of The War’s Course and Outcome
by Just how much of a detrimental affect the Vietnam War had on the country’s development will be discussed below. That economic development was also affected by political and military factors such as the war of independence from France, the country being split into two and the subsequent war between communist North Vietnam and capitalist South Vietnam. North Vietnam’s victory reunified the whole country under communist control and meant the removal of capitalism from the south of the country.
The industrial sector has now become the most important part of the economy, representing 41% of Vietnamese gross domestic product. It is the industrial sector that has driven economic development forward and been reliant on international trade to promote its growth and economic development. Vietnam’s main export earnings are derived from fishing, coal mining, textiles and potentially the most profitable of all the export of all, crude oil. Exports are an important source of income to fund economic development and obtaining foreign currency to buy raw materials and industrial equipment. For example Vietnamese exports to the United Kingdom during 2005-totalled £714, 490,000 that are a sign of the earning power of exported goods (Whitaker’s 2007 p. 1049). Vietnam has also recently renewed a contract with the Russians to boost oil production and exports. That is a reminder of the relationship of when the Soviet Union had a strong influence upon the Vietnamese economy. Of course both Vietnam and Russia have embraced capitalist economic policies (Shchedrov, Monday 20 November 2006). Vietnam also needs imports to maintain economic development. Petroleum and related products, industrial machinery for new industries and raw cotton for textile production are amongst the most vital for economic growth. International trade has made a considerable contribution to Vietnam’s high economic growth rates, for instance estimated growth of gross domestic product for 2005 was an impressive 7.6% (Whitaker’s 2007, p.1049).
Promoting international trade also allowed Vietnam to improve its balance of payments position. In capitalist economies the balance of payments is seen as an important indication of a country’s wealth and level of economic development. Import quotas and currency exchange rates can affect the balance of payment. Vietnam has reduced its import quotas embarking upon economic liberalisation whilst boosting its exports to a growing number of trading partners (Baxter, Bannock & Davis, 2003, pp. 16-18).
Vietnam has benefited from improved international trade with Japan, the United States and China, which has started to increase national prosperity and led to a healthy balance of payments surplus that stood at $1,054 million in 2002. International trade can also help the economic development of Vietnam as it can help attract foreign investment and reduce the national debt (Whitaker’s, 2007, p.1049). Vietnam sees the benefits and the need for international trade for its economic development. In economic terms it is a communist state just in name. It intends to continue high rates of economic growth through increased levels of trade. Vietnam has not only joined ASEAN it has become a member of the Asia-Pacific Economic Co-operation (APEC) as well (Bannock, Baxter & Davis, 2003, p.9).
International trade plays an important perhaps even a vital role in the economic development of Vietnam, and reversing the damage caused by the Vietnam War and Communism. The Vietnamese government started to liberalise economic policy once it realised that a centrally planned economy would not produce sustainable economic development over a long-term basis. Moves to increase international trade gained greater urgency after the collapse of the Soviet Union.
Bibliography
Bannock G, Baxter R E, & Davis E, (2003) The Penguin Dictionary of Economics, Penguin, London
Beattie A, Kazmin A, & Williams F, Vietnam leaps hurdles to join trade body – Financial Times, 7 November 2006
Evans G & Newnham J, (1998) The Penguin Dictionary of International Relations, Penguin, London from www.ft_com
Hobsbawm, E (1994) Age of Extremes, the Short Twentieth Century 1914-1991, Michael Joseph, London
Lenman B P (2004) Chambers Dictionary of World History 2nd edition, Chambers, Edinburgh
Shchedrov O, Putin promotes Russian trade in Vietnam – The Scotsman, Monday 20 November 2006 from www.Scotsman.com
Whitaker’s, (2007) Whitaker’s Almanack 2007 – today’s world in one volume, A & C Black, London
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