One of the most significant things that we learned from President Obama’s recent visit to Vietnam (May 2016) is the tone and outlook of the country’s population, which gives us valuable insight into the future of the country.
Concerns Going Forward
Although Vietnam’s transition from a communist dictatorship to a market-based economy has fueled tremendous growth and been enabled by significant reforms that support private ownership and enterprises, there are still many concerns. For one thing, legal protection for private property is stilted. Suits can take up to 10 years to resolve, and any problems concerning state-owned entities are shrouded in mystery and secrecy.Vietnam has a long way to go before it dispels the corruption that we’ve seen time and time again in socialist regimes, and makes an atmosphere truly conducive to secure, autonomous private business.
Additionally, as President Obama focused on in his address to the nation, concerns persist about the value Vietnam places on human rights. The government continues to crack down on dissenters and reformers, silencing free speech and freedom of the press. Not only does this put a strain on international relationships, but it can snuff out enterprise and entrepreneurship that are the lifeblood of a market economy.
Powerful Signs of Change
While these concerns remain, the outlook for change is good. President Obama’s address, even though it condemned Vietnam’s history of snuffing civil rights, was broadcast on Vietnamese public television, not filtered and censored as might have been expected.
In fact, US presence in Vietnam has been warmly received in recent times, not only with Presidential visits, but also in business settings. As President Obama expressed, the rising generation, free from the scars and damage of war from decades before, embraces positive relationships with the Western world, perhaps fueled in part by the economic growth seen through continued improved relationships.
Vietnam is Hopeful for the Future
Vietnam has an abnormally young population, with 60% of its population working age, and an average age of 29 (contrast that with America’s 39). Furthermore, this workforce is characterized by a hardworking, ambitious, and optimistic tone, simply not found in older economies.
The number of people living in extreme poverty in Vietnam has gone from 50% in the early 1990’s to less than 3% now. Vietnam has a large, robust middle class. Its economic outlook going forward sets a goal for an annual average expansion of 7%. While this may seem like an ambitious goal, the 90’s saw 5.5% annual growth on average, and the 2000’s accelerated that to 6.4%. If things continue the way they have so far, Vietnam is in a great position to achieve its goals.