Impacts of reform policies on agricultural sector in Vietnam

Abstract

In the last two decades, Vietnam has undergone dramatic changes due to policy reform. One of the great achievements which is not deniable is in the agricultural and rural sector. Agricultural reform first started in 1981 with a shift in responsibility for cultivation to farming households. Although the shift was only partial, this reform helped to unleash farmers, and output and efficiency responded significantly. The 1988-89 reforms swept away ambiguities: production means and other goods were returned to private ownership, production and distribution were liberalized and price controls abolished. In addition, liberalization of external trade and devaluation of the currency opened the economy to the world market. The 1993-94 reforms continued to speed up agricultural growth. The effects of reform policies are continuing to be felt up today and will be in the future. The analysis has shown that along with the yields, total output of agriculture has increased dramatically. This has led to a more efficient use of land, the scarcest production factor in Vietnam: Land. Agricultural and rural incomes have also improved and rural poverty has fallen. However, poverty is still a phenomenon of rural areas and ethnic minority groups. In recent years, agricultural productivity growth has slowed; income disparities between regions and groups of people have expanded; unemployment and underemployment in rural areas are more severe, etc. For further development particularly in meeting the targets of the Ten-Year Socio-Economic Development Plan (2001-2010) drafted by the Government in 2000, Vietnam needs to have simultaneous policies to develop not only agriculture but also other sectors.