More Viet­namese es­cap­ing poverty, but re­gional, eth­nic gaps re­main

The Myanmar Times - Weekend - - W Eekend | from the east -

MORE peo­ple in Viet­nam have es­caped poverty in re­cent years thanks to in­creas­ing wages amid strong job de­mand on eco­nomic growth.

Yet, much re­mains to be done to nar­row a gap be­tween ru­ral and ur­ban ar­eas, as well as be­tween eth­nic mi­nori­ties and the Kinh peo­ple, the ma­jor­ity, and Hoa (Chi­ne­se­viet­namese) peo­ple.

Ac­cord­ing to a re­cent re­port by the U.N. De­vel­op­ment Pro­gram, about 6 mil­lion peo­ple moved out of poverty in the so­cial­ist repub­lic with a pop­u­la­tion of 94 mil­lion in four years through 2016.

The global poverty in­dex adopted by the U.N. or­gan ranked Viet­nam at 31 among 105 coun­tries – wealth­ier than Laos, Myan­mar, Cam­bo­dia, In­dia, the Philip­pines and In­done­sia, but be­hind China (23rd) and Thai­land (eighth) among Asian peers.

A World Bank re­port shows Viet­nam’s poverty rate fell to 9.8 per­cent in 2016 from 17.2 per­cent in 2012. The global poverty line for the rate is $3.2 per capita con­sump­tion per day, ad­justed for pur­chas­ing power in 2011.

No­tably poverty among eth­nic mi­nori­ties in two years through 2016 de­clined by 13.2 per­cent­age points, the largest drop for them in the past decade, the re­port said, though their poverty rate at 44.6 per­cent was still much higher than 3.1 per­cent for the Kinh and Hoa groups.

Viet­nam has made re­mark­able achieve­ments in re­duc­ing poverty but chal­lenges re­main in re­duc­ing dis­par­i­ties among re­gions and eth­nic groups, both the UNDP and World Bank said in their re­ports.

The poverty rate in ur­ban ar­eas de­clined from 5.4 per­cent in 2012 to 1.6 per­cent in 2016 while in ru­ral parts it fell from 22.1 per­cent to 13.6 per­cent, the World Bank re­port shows.

“My fam­ily farm corn and rice. Our daily spend­ing is about 50,000 dong ($2.1) for three peo­ple,” said Ngoc Thuy, a 24-year-old wo­man of the Hmong mi­nor­ity from the north­ern­most prov­ince of Ha Giang shar­ing a bor­der with China.

“To earn more money, I needed to move out” of the re­mote area, she said. The wo­man earns 5 mil­lion dong per month by work­ing at a South Korean tex­tile fac­tory in Binh Duong Prov­ince, north of Ho Chi Minh City.

Ac­cord­ing to the UNDP re­port re­leased in Oc­to­ber, the Hmong, who live in moun­tain­ous prov­inces near borders of China and Laos, are among the poor­est eth­nic groups in Viet­nam.

The Kinh ac­count for nearly 90 per­cent of the to­tal pop­u­la­tion and the Hoa are rel­a­tively rich Chi­nese Viet­namese. More than 50 eth­nic mi­nori­ties re­side in Viet­nam.

“Wage growth was the most im­por­tant driver of house­hold in­come growth in both ru­ral and ur­ban ar­eas, and for both eth­nic mi­nori­ties, and the Kinh and Hoa,” the World Bank re­port said.

It said Viet­nam pur­sued “an ex­port-ori­ented model that suc­cess­fully gen­er­ated jobs” and “most house­holds, both poor and non-poor, have a wage in­come” with rapid growth in wage em­ploy­ment in all sec­tors in­clud­ing agri­cul­ture.

Viet­nam’s ex­ports nearly tripled from 2010 to 2017, ac­cord­ing to trade data.

Still, the poor are heav­ily con­cen­trated in ru­ral ar­eas and among eth­nic mi­nori­ties. Of the 9.1 mil­lion poor peo­ple, 94.7 per­cent live in ru­ral parts and 72.9 per­cent are mi­nor­ity groups, the re­port said.

As a shift from tra­di­tional crop cul­ti­va­tion has con­trib­uted to poverty re­duc­tion in ru­ral ar­eas and among eth­nic mi­nori­ties, the re­port sug­gested that farm house­holds grow more prof­itable crops such as cof­fee, black pep­per or rub­ber in­stead of less prof­itable rice or corn. But their ac­cess to fi­nance should be im­proved at the same time.

Hoang Dia, a 28-year-old Hmong man from the north­east­ern prov­ince of Cao Bang neigh­bor­ing China, said, “In our area, we sur­vive by eat­ing corn and rice, with lim­ited in­come by sell­ing left­overs.”

“The av­er­age earn­ing is about 100,000 dong per day (per fam­ily),” he said, adding that peo­ple around him have lim­ited ac­cess to loans and very small amounts if any.

“Poor peo­ple just want to have small amounts of loans, without any value as­set as col­lat­eral,” said Tran Thi Ngoc Ha, head of the In­ter­na­tional Re­la­tions De­part­ment of TYM Mi­cro­fi­nance In­sti­tu­tion un­der the Viet­nam Women’s Union, which sup­ports fi­nan­cial and so­cial ser­vices to poor and low-in­come women.

Be­side in­come growth, one of the fastest grow­ing economies in South­east Asia has also seen progress in health and ed­u­ca­tion.

In 2017, the av­er­age life ex­pectancy at birth stood at 76.5 years, out­per­form­ing many of its neigh­bors.

The coun­try’s av­er­age num­ber of years of ed­u­ca­tion re­ceived by peo­ple by the age of 25 was 8.2 years, higher than the av­er­age of East Asia and the Pa­cific at 7.9 years, ac­cord­ing to the UNDP re­port.

Koji Sako, se­nior chief re­searcher at the Mizuho Re­search In­sti­tute of Ja­pan, said he be­lieves that so­cial­ist coun­tries are more en­thu­si­as­tic about ed­u­ca­tional in­vest­ment than other coun­tries.

The World Bank re­port said, “An av­er­age of 1.5 mil­lion Viet­namese joined the global mid­dle class each year since 2014, con­firm­ing that house­holds con­tinue to climb the eco­nomic lad­der after es­cap­ing poverty.”

To ad­vance poverty re­duc­tion, the World Bank sug­gests that Viet­nam should wel­come more for­eign di­rect in­vest­ment into high­er­value agri­cul­ture, man­u­fac­tur­ing and ser­vices while in­creas­ing in­fra­struc­ture in­vest­ment.

It also calls for ed­u­ca­tion re­forms to de­velop work­force skills and fur­ther agri­cul­ture struc­tural trans­for­ma­tion.

“It takes longer time to train of­fice work­ers than fac­tory work­ers,” Sako said, adding that it is im­per­a­tive to lev­er­age man­u­fac­tur­ing in­dus­tries to sus­tain the trend of a grow­ing mid­dle class.

Photo: Ky­odo

A Hmong wo­man mak­ing yarns in Ha Giang Prov­ince, north­ern Viet­nam in Novem­ber 2016.

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