Poverty in Vietnam
Based on a report from the Asian Development Bank, Vietnam has a total population of 91.70 million as of 2015, about one million people more compared to the previous year.
8.4% of the population lived below the national poverty line.
Poverty and demographics
There are a wide range of causes of poverty, however poverty derives mostly from demographic elements:
- The majority of the poor are farmers. In 1998 almost 80 percent of the poor worked in agriculture.
- The majority of the poor live in rural, isolated, mountainous or disaster prone areas, where physical infrastructure and public service are relatively undeveloped.
- The poor often lack production means and cultivated land.
- They have limited access to the state credit and often access through back credit with very high interest .
- The households often have many children but few laborers .
- The poor are disproportionately likely to be from an ethnic minority.
- The percentage of households with heads coming from ethnic minorities increased from 17,8 percent in 1993 to 40,7 percent in 2008.
- The poor have limited education: people who have not completed primary education account for the highest rate of poverty.
- Rural households consisting of only women and children are particularly vulnerable to poverty because the number of dependents is relatively high compared with the available labor force.
Provision on poverty line
Poverty line applied for the period 2005 – 2010
Based on the state of the socio–economic development, the government promulgates the poverty line for each stage.
The ordinance of the poverty line applied for the period 2005 – 2010 provided that:
- In the rural area, households with average income under the Vietnamese đồng (VND) 2,400,000 per capita per year (equivalent US $150 ) are regarded as poor households.
- In the urban area, households with average income under VND 3,120,000 per capita per year (equivalent US $195 ) are regarded as poor households.
Poverty line applied for the period 2011 – 2015
The ordinance of the poverty line applied for the period of 2011 – 2015 provided that.
- The poor households in rural areas are households with average income under VND 400,000 per capita per month or VND 4,800,000 per capita per year (roughly USD $19 per capita per month).
- The poor households in urban areas are households with average income under VND 500,000 per capita per month or VND 6,000,000 per capita per year (roughly USD $24 per capita per month).
- The pro – poor households in rural areas are households with average income from VND 401,000 to VND 520,000 per capita per month (roughly US $19 to US $25 per capita per month).
- The pro – poor households in urban areas are households with average income from VND 501,000 to VND 650,000 per capita per month (roughly US $24 to US $31 per capita per month).
With the new poverty line, Vietnam’s percentage of households was estimated 12 percent at the end of 2011.
Achievements in poverty reduction
Some achievements regarding poverty reduction in Vietnam are summarized below.
Maintaining high economic growth to underpin further rapid reductions in poverty.
The high and sustainable growth is the pre-condition to create employment, improve income and create resources needed to implement well – being and social – safety programs.
The high economic growth from 2000 to 2010 was regarded as substantial cause in poverty reduction and hunger eradication.
The high political determination and commitment of the government in fighting against poverty and hunger play a critical role. In the two last decades, many policies have been promulgated with huge governmental funds.
The most prominent program is the socio-economic development program for the most vulnerable communes in ethnic minority and mountainous areas, also shortly referred to as the 135 program.
The program’s target is to:
- Promote production and increase living – standard for ethnic minority households;
- Develop infrastructure and develop public essential public service in the localities such as electricity, schools, health clinics, small irrigation system, roads, clean water providing systems;
- Enhance the people’s awareness for better living standards and quality of life.
In the phase I (1998 – 2005), the program invested VND 9142 billion (US 571 million) from the governmental fund for 1870 extremely difficult communes.
Assistance from the international community
As an under-developed country, Vietnam had been prioritized to receive Official Development Assistance (ODA) from international organizations and developed countries such as The World Bank, The Asian Development Bank, The United Nations and The European Commission.
Over the last decades, these organizations have provided millions of dollars to invest for infrastructure, human resource development, public administration reform.
For example, in the period of 1993–2001 a total of US $17.5 billion was pledged to the Government of Vietnam, with annual pledges remaining at a constant level in the order of US $2.2 billion each year.
Collaboration between parties
Reduction in poverty is only successful if all parties from the Government to civil society and donors, from central to local Government and people themselves involve in the process.
However, it is essential that the roles and responsibilities of the various stakeholders are assigned clearly and specifically.
Greater clarity of their roles will result in a more effective and greater coherence between them.
The Vietnam Development Report (2001) suggests a way of addressing this by making a clear division of responsibility between central and local Government, the role of poverty reduction staff at local levels, and of related stakeholders, for the management and delivery of poverty reduction activities.[
The social protection system plays an essential role for sustainable poverty reduction.
In Vietnam, the current social protection system consist of three main components which are social security, social assistance and area – based programs.
The social security includes social insurance, health insurance and unemployment insurance.
The social assistance targets beneficiaries including the elderly aged 85 and over or living alone, the disabled, mentally – disorder patients, single parents, orphans and others whereas the area – based program is to spend on emergency relief to provide aid to natural disaster victims.
Similar Recent Posts by this Author:
- POVERTY IN THE PHILIPPINES
- The depth and profile of UK poverty has changed considerably – official statistics must start capturing this reality amidst COVID-19
- VIETNAM NATIONAL INSURANCE CONTRIBUTIONS
- More on Vietnamese Insurance Contributions
- How a Socialist Country’s Transition Towards a Market Economy Impacts Political Reform: The Case of Vietnam
- CHINESE MARKET ECONOMY EMPLOYMENT