Socialist Republic of Vietnam

1. Uneven restructuring of lines and occupations

Vietnamese rural area now consists of 13.15 million households, of which 10.5 million, or 79.8%, are engaged in agriculture, forestry, and aquaculture, 598.8 thousand, or 4.5%, in industry; 169.7 thousand, or 1.3%, in construction; 760.6 thousand, or 5.8% in trade; 145.1 thousand, or 1.1%, in transportation; 568.5 thousand, or 4.3% in services; and 409.7 thousand, or 3.1%, in other lines. As thus, if the ratio of industry-construction households was only 1.6% of the totality in 1994, it rose to 5.8% in 2001 (up by 4.2%); the ratio of services households was 6.4% and 11.2% respectively (up by 4.8%); and in sum, the ratio of households not engaged in agriculture, forestry, and aquaculture (excluding other lines) rose from 8% to 17% (up by 9%).

















Of the total 11.26 million agro-forest-aquatic households (including 10.5 million in rural area, and 760 thousand in urban area), agriculture account for 10,723.9 thousand households, that is 95.2%; forestry 24 thousand, 0.2%; and aquaculture 509 thousand, 4.5%. As thus, if the ratio of aquaculture households was only 2.3% of the totality of agro-forest-aquatic households in the country and 1.9% of all rural households in 1994, it was 4.5% and 3.9% respectively in 2001.

The structure of income of rural households has also made positive headway. Of the total income, that from production and business accounts for 78.1%, and others (remuneration, wages, social insurance) 21.9%. Of the total production-business income, that from agriculture, forestry, and aquaculture makes up 75.6%, from industry and construction 10.6%, and from services 13.8%.

Of the total income from agriculture, forestry, and aquaculture, that from agriculture accounts for 79.9%, that is lower than the household ratio of 95.2%; from forestry 4.8%, and from aquaculture 15.3%, exceeding by far their household ratios of 0.2% and 4.5% respectively.
Of the total income from agriculture, that from plant cultivation accounts for 68.5%; from stock breeding 29.5%, and from agricultural services 2%.
Of the total income from plant cultivation, that from annual crops accounts for 77.8%; from perennial crops 19.7%.

Of the total income from stock breeding, that from cattle accounts for 67.8%; from fowl 19.2%; from others 8.1$, and from hunting and animal domestication 0.5%.

Thus, in rural area and in the agro-forest-aquatic line of the country, the economic structure has moved in a positive direction the ratio of industry-construction and services in rural area, the ratio of aquaculture-forestry in the agro-forest-aquatic line, the ratio of stock breeding in agriculture, and the ratio of perennial crops in plant cultivation have increased. This is the fine result of the implemented policies on industrialization, modernization, and restructuring of rural, agro-forest-aquatic economy in Vietnam.

However, restructuring in rural area is still slow-going. For seven years, the ratio of industry-construction-services households in rural area rose by 9%, that is less than 1.3% per year only; and the ratio of agro-forest-aquatic households in still some 79.8%, that is too big for the attainment of the basic target of making Vietnam an industrial country by 2020. Moreover, the restructuring has unfolded unevenly among regions; while the ratio of industry-services households in eastern Nam Bo reached 32.8%; up by 14.6% against 1994, it was only 6.1%, up by only 0.6%, in the Central Highlands. The household restructuring as well as the income from agriculture, forestry, and aquaculture are still slow and uneven, when annual crops, plant cultivation, and agriculture - the lines having a lower commodity proportion, several of which seeing an excess of supply over demand, and being confronted with great difficulties as regards market and prices- still account for a quite big ratio.

In 2000, the average development investment capital for each household was 3.5 million VND, that is a total of 46.2 million VND, that is a total of 46.2 thousand billion VND for all rural households. The average saving of a household in 2000 was 2.1 million VND, that is a total saving of 40.9 thousand billion VND by all rural households. That is a capital potential which should be induced for development investment through

Government's policies.

As for aquaculture alone, there are, at present, 120.445 mechanized fishing vessels, a rise of 48,981 vessels (68.5%) over 1994, of which 14,403 have a capacity of over 90 CV for offshore fishing.

2. Production relations initially consolidated

In addition to household economy, which is prevalent, farm economy is developing fast and collective economy has started to grow.
Almost from scratch, by October 1, 2001 Vietnam boasted 60,758 farms. The number of farms engaged in annual crops was 21,798, or 35.9%; in perennial crops 16,614, or 27.3%; in stock breeding 1,762, or 2.9%; in forestry 1,630, or 2.7%; in aquatic product raising 16,951, or 27.9%; and in general business 2,006, or 3.3%.

These farms used 369.6 thousand ha of land and water surface, of which the land area for annual crops was 137.7 thousand ha, or 37.3%; for perennial crops 96.1 thousand ha, or 18.7%; and the water surface for aquatic product raising was 66.5 thousand ha, that is 18%. On average, a farm used 6.08 ha.

The farms engaged 374,701 workhands, including 168,634 ones from farm owner households, and 206,067 ones as hired labour 960,880 workhands as permanent ones, and 145,187 as seasonal ones). On average, a farm engaged 6.2 workhands (2.8 from farm owner households, and 3.4 as hired labour).

The farms' total investment capital, by October 1, 2001, was 8,294.7 billion VND, averaging 136.5 million VND for each farm. Farm owners' capital was 7,021 billion VND, that is 84.6% of the totality, averaging 115.6 million VND for each farm. Bank loaned capital was 1,096.9 billion VND, that is 13.2%, averaging 18.1 million VND for each farm. Loans from other sources amounted to 176.9 billion VND, that is 2.2%, averaging 2.9 million VND for each farm. The above-mentioned data show that the farms' investment capital came mainly from their own resources, while the banks' role was not distinct.

Although the farms have just come into being and developed for a few recent years, and the building of some of them is still underway, by 2000 they had obtained a total turnover of 5,360.9 billion VND, averaging 88.2 million USD for each farm. The value of commodities and services which were sold amounted to 4,965.9 million VND, averaging 81.7 million VND per farm, with the ratio of commodities attaining 92.6%. The farms' income totaled 1,905.8% billion VND, averaging 31.5 million VND per farm; and the average monthly income of each person in a farm owner household was 584 thousand VND, that is 2.5 times as much as the average per-capita income in rural area.

By October 1, 2001, Vietnam had 7,226 agricultural cooperatives which were transformed and founded in accordance with the 1996 Law on cooperatives (6,314 cooperatives transformed and 912 newly founded); 13 forest cooperatives, and 319 aquaculture cooperatives. The former cooperatives, which haven’t been, transformed number 5,034; they are mainly defective ones, stay almost inactive, and center mainly in the northwestern region (2,602 cooperatives, that is 52.1%), northeastern region (1,613, 32.4%), and northern central Vietnam (524, 10.4%).

The transformed and newly founded cooperatives were engaged mainly in providing services to peasants, with a convenient working mode and at prices lower than those of private business in the same locality. They included 5,441 cooperatives for irrigation, that is 84.9% of the totality; 4,612 for plant protection, 71.9%; 3,704 for seeds, 57.8%; 2,400 for land work, 37.4%; 1,627 for fertilizers, 25.4%; and 1,979 for other services, 30.9%.

The total production capital of the agricultural cooperatives was 4,601.3 million VND, averaging 636.8 million VND per cooperative. The capital of the cooperatives and coop members was 3,881.7 billion VND, that is 84.2% of the total production capital of cooperatives, averaging 537.2 million VND per cooperatives; the cooperatives' debts amounted to 718.5 billion VND, that is 15.6%, averaging 99.4 million VND per cooperative. The cooperatives' bank loans amounted to 159.3 billion VND, that is only 3.5% of the total production capital, averaging 22 million VND per cooperative. The cooperatives' bad debts were 174 billion VND, averaging 24.1 million per cooperative.

The value of products and services sold by the cooperatives in 2000 was 1,881.4 billion VND, averaging 260.4 million VND per cooperative. Profitable cooperatives numbered 4.760, that is 65.9% of the totality, that is 65.9% of the totality. But their profits were still small, amounting to 136 billion VND, averaging 28.6 million VND per cooperative. The average ratio of profit to capital was only 3%, and that to turnover 7.2%. Loss incurring cooperatives numbered 280, or 3.9% of the totality and the loss amounted to 3,814 million VND, averaging 13.6 million VND per cooperative.

(Vietnam Economic Review No 9 (9/2002) )