Vietnam

Table of Contents

• Overview
• Thematic Focus
• Progress on Aid Effectiveness
• Achievements

Overview

Vietnam has made significant development progress over the past two decades and has increasingly integrated into the world economy. The government has strong ownership of its development agenda and consistently demonstrates an effective use of development assistance. Vietnam has reduced poverty at an unprecedented rate: the number of Vietnamese living on less than US$1.25/day fell from 64 percent in 1992 to 16.9 percent in 2010. The country's gross domestic product grew by an estimated 6.8 percent in 2011, despite the global economic recession.

Vietnam's success is reflected in markedly improved social indicators. The country has already met the Millennium Development Goals (MDGs) to eradicate extreme poverty and hunger and to improve maternal health. Vietnam is on track to meet most of the other MDGs, with almost universal access to primary education, health care and basic services. More efforts, however, are required related to gender equality, environmental sustainability, and economic liberalization.

The United Nations Development Programme ranks Vietnam 128 out of 187 countries on its 2011 human development index. In 2010, average per capita income in Vietnam reached US$1,160, moving Vietnam into lower middle-income country status. Recent economic growth has improved the quality of life for many Vietnamese, but some sectors of the population, particularly the rural poor, ethnic minorities, and female-headed households, are not equally benefiting from economic growth. In addition, Vietnam now faces ongoing macro-economic instability and a need to reform its financial sector to meet more competently the demands of its evolving economy.

A single party dominates Vietnam's political system. Corruption and excessive regulations and state controls continue to constrain development, while significant concerns remain regarding rights to freedom of expression and association. There are signs, however, of greater government transparency and accountability, especially within the National Assembly, of more participatory citizen consultations, and of better public financial management.

Vietnam's transition to a lower-middle income economy has brought about new challenges and needs. To promote private sector development and facilitate the ease of doing business, there is a need for legal and policy reforms. There is also a need for reforms to ensure the robustness of the banking and public financial system, better connect public services to the demands of the market and citizens, and combat corruption. Vietnam's ongoing decentralization of public finance accounts and service delivery highlights the need to strengthen provincial capacities, and a focus on increasing agricultural competitiveness is needed to address sustained poverty reduction in rural areas.

Thematic Focus

In 2009, as part of Canada's new aid effectiveness agenda, Vietnam was selected by CIDA as a country of focus. CIDA's current program in Vietnam responds to the Government of Vietnam's poverty reduction priorities and focuses on improving the enabling environment for investment and to support rural enterprise development and agricultural competitiveness. Vietnam's development goals are set out in the Five-Year Socio-Economic Development Plan 2011-2015 (PDF, 774 KB, 147 pages), in which reforms and targets for economic growth and poverty reduction are outlined for four main areas:

• Economic institutional restructuration
• Education, training, and human resource development
• Development of a knowledge economy
• Environmental protection and prevention of natural disasters

Economic growth

CIDA focuses on supporting policy reforms that improve the transparency and accountability of public institutions and market-driven growth. To do so, CIDA is helping to promote private sector development and entrepreneurship, small and medium-sized enterprises, legislative and banking reforms, and improved access to skills for employment.

Food security

CIDA focuses on increasing agricultural competitiveness by improving food safety and quality and by supporting agricultural innovation the development of marketing techniques for farmers and traders, especially at the provincial level.

As well as promoting national reforms and provincial governance, CIDA supports Canadian organizations that work with Vietnamese counterparts. Canadian organizations respond to the development needs of vulnerable groups, such as women and ethnic minorities, in Vietnam. By partnering with Vietnamese organizations, Canadian organizations work in a wide range of areas, including agricultural productivity, technical and vocational training, municipal governance, and higher education. Canadian organizations supported by CIDA include Oxfam-Québec, the Société de coopération pour le développement internationale, Consortium WUSC-CECI, the Federation of Canadian Municipalities, and Saint Mary's University.

Progress on Aid Effectiveness

Vietnam is recognized internationally as a leader in aid effectiveness for its strong local vision, ownership, and implementation of a made-in-Vietnam poverty reduction strategy.

Vietnam offers an effective model for donor coordination at the policy level. The Vietnamese government's commitment to transparent results reporting is set out in the Hanoi Core Statement on Aid Effectiveness and the Vietnam Partnership Document, which adapt the Paris Declaration on Aid Effectiveness (PDF, 317 KB, 23 pages) and the Busan Partnership documents to the Vietnamese context. CIDA, along with other donors and development partners, is actively engaged in the Government of Vietnam's donor consultative group coordination process. CIDA also plays an active role in supporting recognition and space for Vietnamese and international civil society in the country's development plans.

Achievements 2011-2012

Economic growth

• Contributed to establishing modern budget management systems in 35 provinces, increasing efficiency and transparency in the use of public finances
• Helped train, since 2009, more than 4,800 legislators and government staff members on policy development and lawmaking, leading to the creation of modern and coherent laws on commercial arbitration and labour and to strengthening the environment for businesses to grow and to create jobs
• Helped 7,966 people, 67 percent of whom were women, acquire new skills in areas such as teaching, training the trainers, and communications, in 10 organizations working in private sector development
• Helped train 7,800 students in communications, team work, conflict resolution, interpersonal skills, information management, and interview techniques, resulting in 85 percent of the students finding employment
• Trained 75 provincial experts to design and to deliver courses on industrial pollution management to stakeholders in the public and private sectors
• Contributed to the establishment of model courts in three provinces and provided exposure to Canadian expertise and technology in court administration, such as digital and audio recording in trials, to improve the efficiency and transparency of courts

Food security

• Helped farmers meet internationally recognized Good Agricultural Practices (GAP) for four key agri-food products, significantly reducing chemical contaminants in fruit, vegetable, poultry, and pork
• Supported the rehabilitation of 12 small-scale irrigation works servicing more than 1,000 hectares of rice land and improved village roads for 400 households in the province of Ha Tinh
• Contributed to the development of a national strategy on climate change (PDF, 154 KB, 8 pages), 20 provincial coastal management plans, and a national action program to reduce greenhouse gas emissions from agriculture

Achievements 2010-2011

Economic growth

• Helped 1,200 small and medium-sized enterprises —90 percent of them owned by women — increase profits between 2007 and 2010 through business skills training
• Contributed to the development of industrial pollution management plans in eight provinces, helping Vietnam to better manage environmental challenges associated with rapid economic growth

Food security

• Increased the incomes of 15,000 people by 20 to 40 percent between 2003 and 2010 by improving the productivity of rice and shrimp farming
• Helped the Government of Vietnam improve food quality and safety through specialized training and the upgrading of seven laboratories to meet international testing standards

Achievements 2009-2010

Economic growth

• Improved the development of rural micro, small, and medium-sized enterprises (MSMEs), and increased the income and viability of more than 1,200 MSMEs (90 percent owned by women) in three targeted provinces
• Helped more than 450 enterprises directly benefit from small grants for training or new technology to improve production and access to new markets

Food security

• Provided assistance to farmers in the province of Soc Trang, increasing fragrant rice production more than five times, from 3,600 hectares in 2005 to nearly 19,000 hectares in 2009, and their income by 20 percent
• Supported the development and application of internationally accepted practices for key agri-food products to help ensure food quality and safety through work with the Vietnamese Ministry of Agriculture and Rural Development

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