The year 2016 is a special year for me because it marks 10 years since my return to Vietnam after more than ten years living abroad, and it is also the year I turned past 40, an age that is no longer young. This article is my very personal observation (and is not scientific in nature) regarding Vietnam over the past 10 years through the eyes of a returnee who transitioned from a researcher into business, on the occasion following the Party Congress and the conclusion of a government term.
To me, the Vietnam of the 2006–2015 decade can be generalized through the following main points:
- The severe manipulation by private companies in collusion with state officials, what General Secretary Nguyen Phu Trong called “group interests,” while economists call “crony capitalism” (cronyism);
- Regarding the public sector, the “plundering of the budget” or “budget mining” was pushed to its peak;
- This decade marked a comprehensive crisis in the nation’s education system;
- Social media and communications exerted an enormous influence on Vietnamese political life;
- And finally, a massive wave of wealthy and knowledgeable people leaving, yet another migration.
The first issue is the severe manipulation by private corporations. Never before has crony capitalism in Vietnam manifested so clearly. Crony capitalism or “group interests,” here is the combination between private companies and state officials in obtaining special privileges and profits to exploit a certain resource on an unequal, non-fairly competitive mechanism. The phrase you would hear most over the past 10 years would be “this spot belongs to Mr. A, that spot belongs to Ms. B.” It seems there is no major business game in Vietnam that lacks the “protection” of a certain official. All economic relationships are replaced by tangled webs between politics and enterprise.
The most dangerous aspect of crony capitalism is that it creates an unequal playing field in which other private companies do not get the opportunity to participate. Through this, “group interest” companies enjoy monopoly rights to exploit resources or a certain activity, usually to the detriment of consumers. In finance, this is a game of using power to acquire enterprises according to one’s own desires. In education, it is the granting to an educational company the monopoly to supply a service or equipment that students and parents must buy without any alternative choice.
In infrastructure construction, political connections are used to win large contracting bids without fair and transparent bidding processes. In real estate, it is changing urban planning to create advantages for businesses or acquiring prime locations through unequal relationships.
Instead of developing along a transparent path beneficial for the long term, Vietnam seems to be slipping down the development path of countries where crony capitalism holds sway without a way out, such as the Philippines, Latin American countries, the Russian Federation, and China. And eventually, if not controlled early on, businesses will be the ones controlling the political and economic game, sending consumers to prison, gagging journalists, etc., and ultimately becoming the real force manipulating politics, elevating one person and bringing another down. When politics is dictated by money and connections, politics has become a “tool” of big capitalist players. And at that point, the economy in Vietnam will become the embodiment of the most “savage” and “disgusting” era of “capitalism,” rather than the socialism desired by Communist Party leaders.
The second issue, to me, is “budget mining” (borrowing the phrase from Dr. Vinh Du Tran). The past decade in Vietnam was marked by local authorities “spending beyond their means.” Never in any period has Vietnam had so many pagoda structures, commemorative projects, and administrative center projects swallowing hundreds and thousands of billions like in recent years. Localities competed with one another to gouge the budget through public projects. There is no easier way to siphon money from the budget than through public projects. A construction project or monument area valued at hundreds of billions in investment will be handed over to a “friendly” construction company. That construction company will become the main contractor and thereby can share back benefits with the decision-makers.
The astonishing and infuriating point is that while everyone plainly knows the wastefulness and blatant siphoning of money through these projects, the central government seems unable to impose its authority and decisively stop these decisions.
Why can local authorities request state budgets in such an arbitrary manner?
This paradox can be fully explained. The central government receives votes of confidence evaluations from two sources:
a) central committee members, represented by provincial/local government leaders;
b) vote of confidence evaluations from the National Assembly.
However, central committee members are the ones who actually elect the Politburo, the Prime Minister, and in practice, the Cabinet. Meanwhile, the vote of confidence from the National Assembly carries only symbolic meaning without penalties.
Therefore, there appears to be a compromise between local governments and the central government in exchange for supporting votes, especially mid-term. Thus, to avoid scattered investment like above, it is necessary to design a mechanism holding local government leaders accountable and guaranteeing the independence in budget spending decisions of the head of the central government.
Over recent years, social media and communications have played an extremely important role in the economic and political life in Vietnam. Vietnamese society over the past 10 years is no longer a media-passive society. The development of social media has allowed citizens to participate in socio-economic and political life much more proactively. Social media has officially become the place to vent the frustrations, outrage, and pent-up anger of the populace.
If abroad, citizens react to changes by protesting, then in Vietnam, people react by “protesting online.”
Every event with a major impact on life is discussed animatedly on social media. The influence of social media is so great that many incidents were subsequently altered because online public opinion led mainstream media, such as the green tree cutting affair, tablets, integrated English, dirty food, etc.
Returning to politics and media, it seems media and social media summarily ousted the incumbent leaders of the Ministry of Education and Training and the Ministry of Health, while the heart of public opinion seemed “already in love” with former Minister of Transport Dinh La Thang. To be fair, both the Ministry of Health and the Ministry of Education and Training made no small effort over the past 05 years.
However, looking at the way they interacted with the media, these two Ministries still have a lot to change. The Ministry of Health handled media extremely awkwardly, always one step behind, making very naive statements. Meanwhile, the Ministry of Education always appeared arrogant, acting in a very “patronizing” manner toward the media and public opinion with shocking policies and statements such as the 35 trillion VND project, university entrance exams likened to “gambling,” and never providing a genuinely constructive explanation. In contrast, just a single image of Mr. Dinh La Thang ziplining down to inspect an accident scene was enough to win the hearts of millions of citizens, followed by his being the only person elected directly into the Politburo without prior recommendation from the Politburo.
For me, as someone who used to be deeply involved in education and who also has two children of primary and middle school age in Vietnam, education is my greatest concern. To me, the past 10 years witnessed a comprehensive crisis in Vietnamese education. Heading into the 21st century, Vietnam’s K-12 and university curricula remain extremely backward by decades compared to foreign countries. Hundreds of scandals related to K-12 curriculum content occurred; what my children are taught is no different from what my father and I learned over 30–50 years ago.
Teachers still have to teach in a dogmatic, rigid way that stifles creativity. Still the same imposed or unmentioned historical stories. Curriculum reforms that never know when they will finish (whereas if the Ministry of Education delegated authority to the private sector, it might take only 1 year to have all complete curricula). And still the same endless struggles without an exit regarding educational strategy.
AEC and TPP integration are right around the corner, yet over 80% of students taking high school graduation exams scored below 5 in English, an average score. Yet educational managers remain “calm as a millpond.” Bilingual education, specifically English, has still never been considered most important. The teaching of Mathematics and Science, the fundamental educational foundation for a “creative” country, is always taught in an extremely theoretical manner lacking high applicability.
The 2008 crisis dragged on with the precariousness and instability of the economy, leading to a quiet but very clear wave where those with means felt the need to buy “insurance” for their families through the passport of another country. If in 2006 when I returned, the conversation in business and finance circles was where to invest, then in recent years, the constant conversation I hear is where they will migrate to, and how to transfer money abroad. Why do people leave the country? People leave the country because they see too much instability: an unstable economy, severe environmental pollution, widespread toxic food, and especially, an overly backward education system that cannot prepare their children for a future facing an uncertain world.
For every 10 business owners I meet, at least 3–4 already hold permanent residency cards in a capitalist country, and more than half of the remainder are also on the verge of preparing. The biggest difference between this migration wave and others is that this migration is not about ideology at all. This migration is led by the most elite and successful individuals, prepared in an extremely methodical and open manner. They leave, bringing a vast amount of money and intellect. A brain drain and capital flight larger than all previous migrations combined. (As for me, if I ever had to leave the country, the sole reason would be that I do not want my children to live with the lies taking place.)
Entering 2016, I feel somewhat optimistic about the moves made by the Communist Party. It seems leaders have felt part of the heat of public outrage. Corruption is considered a national plague, and high-level leadership appointments seem quite positive. Municipal party committee personnel rotations carry a sense of reform. Another positive point is the fairly young leadership lineup of the Party, regardless of whether they are well-connected scions or not. Media and social media are valued much more. Officials now know how to observe and act according to public opinion reactions; even if those actions are “fake,” knowing to pay attention to public reactions is already a very significant step forward.
I hope that heading into the new decade, the Vietnamese government will thoroughly resolve the issues mentioned above. Become a more decisive government that can utilize the technocratic class. Officials must take personal responsibility for their policy decisions. Let us turn Vietnam in the coming years into an “Education Nation” where the learning of English, Mathematics, and Science is regarded as a top priority.
The Vietnamese government should also be more open to social criticism. Treat social criticism as large mirrors in which to reflect upon oneself. Do not slap labels or impose descriptions on social criticisms as “peaceful evolution” or “reactionary forces.” The Communist Party of Vietnam always renews itself in every life-or-death moment. So renew yourselves, accept change for a better country.
A close friend of mine, a prominent Vietnamese economist, once said with bitterness: The greatest tragedy and paradox of the current political regime is that it turns gentle people, resigned and responsible intellectuals and entrepreneurs (characteristic of the Vietnamese nation) into dissidents. We passionately love this country, and in a way, we benefit from this regime. However, we hope this regime changes positively so as not to turn patriotic people (like us), one day, into “dissidents.”
Note: Title borrows words from a poem by Pham Cong Thien. The article incorporates discussion points from Vu Thanh Tu Anh and Tran Vinh Du.
Ho Chi Minh City, April 21, 2016
Nguyen Quoc Toan
