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When the North and South were divided [[Geneva Conference (1954)|politically]] in 1954, they also adopted different economic ideologies: communist in the North and capitalist in the South. Destruction caused by the 1954-75 [[Second Indochina War]] seriously strained Vietnam's economy. Across Vietnam, the situation was worsened by the country's 1.5 million military and civilian deaths and its later exodus of 1 million refugees, including tens of thousands of professionals, intellectuals, technicians, and skilled workers.<ref name="cs"/>
Between 1976 and 1986, the then-unified country had a planned economy. Though the government's [[Five-year plans of Vietnam#The Second Five Year-Plan (1976-80)|Second Five-Year Plan]] (1976-1981) set extraordinarily high goals for annual growth rates for industry, agriculture, and national income and aimed to integrate the North and the South, the Plan's aims were not achieved: the economy remained dominated by small-scale production, low labor productivity, unemployment, material and technological shortfalls, and insufficient food and consumer goods.<ref name="cs"/> The more modest goals of the [[Five-year plans of Vietnam#The Third Five Year Plan (1981-85)|Third Five-Year Plan]] (1981-85) were a compromise between ideological and pragmatic factions; they emphasized the development of agriculture and industry. Efforts were also made to decentralize planning and improve the managerial skills of government officials.<ref name="cs"/>
In 1986 Vietnam launched a political and economic renewal campaign ([[Doi Moi]]) that introduced reforms intended to facilitate the transition from a centralized economy to a “socialist-oriented market economy.” Doi Moi combined government planning with free-market incentives and encouraged the establishment of private businesses and foreign investment, including foreign-owned enterprises. By the late 1990s, the success of the business and agricultural reforms ushered in under Doi Moi was evident. More than 30,000 private businesses had been created, and the economy was growing at an annual rate of more than 7 percent, and poverty was nearly halved.<ref name="cp">[http://lcweb2.loc.gov/frd/cs/profiles/Vietnam.pdf Vietnam country profile]. [[Library of Congress]] [[Federal Research Division]] (December 2005). ''This article incorporates text from this source, which is in the [[public domain]].''</ref>
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