Key issues in the process of rural economy development in Vietnam

The Vietnamese rural economy has undergone vast changes in the last two decades, particularly since the implementation of the Resolution No. 10 (1988) and Law on Land (1993). As a result, poverty has fallen from 25% in 1993 to 15% in 1998 and 11% in 2000 (MOLISA, 2000). The agricultural GDP has been growing at an annual average of 4.1 per cent annually between 1990 and 1999. The biggest change is observed in food production which has led Vietnam from being an importer of rice to being the world's second largest rice exporter behind Thailand. However, Vietnam is still facing many challenges. In rural areas, unemployment and underemployment are still very high, poverty and malnutrition are rural phenomenon. Agricultural growth has declined over the last few years. The agricultural products prices are relative low and farmers now face the prospect of stagnant incomes. Besides that, rural infrastructure, technology and management are still very poor. Given these challenges, several key issues are closely interrelated and will need to be addressed simultaneously. The present report suggested the key issues for rural development in Vietnam would be (1) redistribution of rural and agricultural labors; (2) efficient use of agricultural land; (3) shifting rural economic structure; (4) development of cooperatives under the Cooperative Law; (5) rural economy investment; (6) reform agricultural price policy; and (7) participation of poor rural people in the market oriented rural economy. The analysis and understanding of each issue are needed for further development of this sector in Vietnam.