clock menu more-arrow no yes

Filed under:

NEW VIETNAM RISES FROM RUBBLE OF WAR

Twenty years ago, an American flag lay in the streets of Saigon outside the abandoned U.S. Embassy, its stars and stripes trampled on.

Today, the American flag is flying in Vietnam again, the symbol of a U.S. diplomatic mission re-established for the first time since the war ended April 30, 1975.U.S. companies are back in business, pledging $270 million in investments since the 19-year trade embargo was lifted in February 1994, and the two countries opened liaison offices in each other's capitals earlier this year, the first step toward establishing full diplomatic relations.

The only stumbling block is the more than 1,600 Americans still listed as missing in action. Vietnam says it is cooperating, but the White House, families of the MIAs and veterans organizations are pressing for a fuller accounting and more responsiveness.

A new, more open Vietnam is emerging from the ruins of war, from the rejection and isolation by the Western world, and from a disastrous socialistic economy that bankrupted it financially and left its people hungry.

The old U.S. bases have been transformed into coffee, rubber and peanut plantations, and hundreds of American tourists freely roam the country, seeing it as more synonymous with mountains and lakes than with war.

Vietnam has grown to the 13th most populous country in the world, with 73 million people, double its size during the war. But its annual growth rate of more than 1.5 million people is putting an enormous strain on already limited basic services.

Vietnam has been unable to shake off its poverty, its No. 1 problem. Half its people are classified as poor, according to a World Bank report issued in January. It is only now beginning to rebuild its archaic highways, ports and electrical and water systems, which could take as long as 20 years.

More than 80 percent of the population is in the rural areas, where water, electricity, health services, schools and other services are scarce.

"Fifty percent of the population does not have enough income to buy a typical consumer basket that would include a recognized minimum standard of calories," says David Dollar, the World Bank's principal economist for Vietnam.

But a new generation, born at war's end or just after it, has emerged with an agenda of its own: to study English and computer science, in hopes American language and technology will lead to more money and better lives.

"We are too young to know about the war," says 22-year-old Doan Tran Thu Thuy, standing in front of a memorial tank in the town square of Buon Ma Thuot and practicing her English on a visitor. "English is a popular language, and I want to speak to all foreigners."

Despite Vietnam's overwhelming poverty, its transition to a market-oriented economy, stepped up in the last year, has helped raise the standard of living for many.

The bustling markets, red bricks piled along roadways for residential construction, and the influx of cars and motorbikes clogging the streets of Hanoi and Ho Chi Minh City attest to the new, albeit limited, affluence.

Economic reforms reduced the size of the largely unprofitable and poorly run state sector from 12,000 enterprises to 4,000, while private businesses grew from a little more than 20 to more than 2,000.

Vietnam opened its door to foreign investors, who pledged $11 billion; inflation dropped from a high of 800 percent to a single digit.

The collectivization that led to famine also has been phased out. Farmers were given long-term land leases at little or no rent, allowing them to share in profits and giving them incentive to produce more.

But there is still far to go. Per capita income is only about $200, although it approaches $570 in Ho Chi Minh City, the center of trade and industry. That still pales in comparison with Asian neighbors such as Thailand, where the per capita income is $1,840.

Vietnamese officials and potential American investors cite a shortage of professional managers, a lack of banking, legal and accounting structures, bureaucracy, corruption and questionable purchasing power as impediments to more foreign investment.

"It's going to be a slow road for a financial gain for anybody," says Bill Willert, a Vietnam veteran who owns Willert Home Products, a St. Louis-based company that manufactures such products as air fresheners, incense sticks and fly swatters.