THE PRESS SATURDAY, SEPTEMBER 5, 1981. Vietnam’s preoccupation

Press, 5 September 1981, Page 14

THE PRESS SATURDAY, SEPTEMBER 5, 1981. Vietnam’s preoccupation

On the thirty-sixth anniversary of Vietnam’s national day, the country was preoccupied with economic problems at home as it might well be. Natural disasters, war, a lack of resources, and bad management have all damaged Vietnam’s economy. The country was already in bad shape when it invaded Kampuchea in 1979. Vietnam suffered when Chinese forces briefly invaded the country. Vietnam is supporting forces abroad, as well as losing the labour that these forces would have provided at home. Throughout 1980 Vietnam probably had one million people under arms and was still actively recruiting others. Some estimates put the country's defence spending as high as nearly half of the country’s budget. The country has known war, off and on, since the Democratic Republic of North Vietnam was founded on September 2, 1945. As time goes on it appears to be becoming more, not less, deprived.

The natural disasters in the last four years have included drought, floods, a typhoon, and exceptionally cold weather. These difficulties were compounded by the passive resistance of some of the peasant farmers of the South who resisted the economic measures imposed by the North. Late in 1979 reforms were introduced, including financial incentives to grow more rice and a new contractual system for production. These were believed to have increased the amount of rice grown. To some extent such incentives went against the philosophy of the Communist authorities but the Government tried ,to control the distribution systems and the marketing and in this way worked for the “socialist transformation of the South.” At best, the economic success was limited.

Vietnam is. showing signs of setting itself less embarrassing targets for production. In an earlier plan it set itself the goal of producing 21 million tonnes of grain by 1980. This was revised down to 15 million tonnes, but the production may have been even lower than this during 1980. The latest five-year plan due tp start in 1981, sets a target of self-sufficiency by 19851 The production of more grain would

help to reduce the trade deficit, which is large. In 1980 Vietnam exported goods worth about $606 million and imported goods from • the Soviet bloc worth $1.2 billion. Industries other than agriculture have suffered a decline and the heavy emigration, forced and voluntary, has depleted the country’s stock of skilled workers. Because so many of its Chinese citizens have gone, mining has beeparticularly badly affected. One result of Vietnam’s plight has been that it has become more heavily dependent on the Soviet Union. Two important trade agreements between Vietnam and the Soviet Union were signed in July. On July 24 an economic agreement with the Soviet Union outlined specific forms of co-operation until 1985. Soviet assistance was promised for more than 100 industrial projects, including the development of coal, electricity, and fertiliser plants. Help was also promised in education. On July 30 another agreement was signed. Under this agreement the volume of goods to be traded between the two countries is to be trebled. The Soviet Union will' supply essential goods to Vietnam including oil, motor vehicles, metals, and road-building machines. In return, Vietnam is to increase its exports of rubber, coffee, spices, timber, and handicrafts to the Soviet Union. The Soviet Union and Vietnam have also joined in setting up a scheme for oil exploration. The Soviet Union has made loans on very favourable terms available to Vietnam.

Vietnamese leaders must be galled to see their country becoming so dependent on another country. Throughout its history Vietnam has had a very strong sense of independence. If the size of Vietnam’s war machine is economically debilitating, and imperilling the country’s self-reliance, the leadership may decide that Vietnam should scale down its military activity and pull its troops out of Kampuchea. Emphasis on the problems of the domestic economy on Vietnam’s national day at the very least shows that the leadership thinks there is more to lament than to celebrate.