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Vietnam HISTORICAL BACKGROUND
Post-1975 developments, including the establishment of new
economic zones, did not eradicate distinctions between North and
South. North, South, and Central Vietnam historically were
divided by ethnolinguistic differences, but until the midnineteenth century and the beginning of the French colonial
period, they were all agrarian, subsistence, and village-oriented
societies
(see Early History
, ch. 1). The French, who needed raw
materials and a market for French manufactured goods, altered
these commonalities by undertaking a plan to develop the northern
and southern regions separately. The South, better suited for
agriculture and relatively poor in industrial resources, was
designated to be developed agriculturally; the North, naturally
wealthy in mineral resources, was selected as the region in which
industrial development was to be concentrated.
The separation distorted the basic Vietnamese economy by
overly stressing regional economic differences. In the North,
while irrigated rice remained the principal subsistence crop, the
French introduced plantation agriculture with products such as
coffee, tea, cotton, and tobacco. The colonial government also
developed some extractive industries, such as the mining of coal,
iron, and nonferrous metals. A shipbuilding industry was begun in
Hanoi; and railroads, roads, power stations, and hydraulics works
were constructed. In the South, agricultural development
concentrated on rice cultivation, and, nationally, rice and
rubber were the main items of export. Domestic and foreign trade
were centered around the Saigon-Cholon area. Industry in the
South consisted mostly of food-processing plants and factories
producing consumer goods.
The development of exports--coal from the North, rice from
the South--and the importation of French manufactured goods,
however, stimulated internal commerce. A pattern of trade
developed whereby rice from the South was exchanged for coal and
manufactured goods from the North. When the North and South were
divided politically in 1954, they also adopted different economic
ideologies, one communist and one capitalist. In the North, the
communist regime's First Five-Year Plan (1961-65) gave priority
to heavy industry, but priority subsequently shifted to
agriculture and light industry.
During the 1954-75
Second Indochina War (see Glossary),
United States air strikes in the North, beginning in early 1965,
slowed large-scale construction considerably as laborers were
diverted to repairing bomb damage. By the end of 1966, serious
strains developed in the North's economy as a result of war
conditions. Interruptions in electric power, the destruction of
petroleum storage facilities, and labor shortages led to a
slowdown in industrial and agricultural activity. The disruption
of transportation routes by U.S. bombing further slowed
distribution of raw materials and consumer goods. In the North,
all 6 industrial cities, 28 out of 30 provincial towns, 96 out of
116 district towns, and 4,000 out of 5,788 communes were either
severely damaged or destroyed. All power stations, 1,600
hydraulics works, 6 railway lines, all roads, bridges, and sea
and inland ports were seriously damaged or destroyed. In
addition, 400,000 cattle were killed, and several hundred
thousand hectares of farmland were damaged.
The economy in the South between 1954 and 1975 became
increasingly dependent on foreign aid. The United States, the
foremost donor, financed the development of the military and the
construction of roads, bridges, airfields and ports; supported
the currency; and met the large deficit in the balance of
payments. Destruction attributed to the Second Indochina War was
considerable. Hanoi claimed that in the South, 9,000 out of
15,000 hamlets were damaged or destroyed, 10 million hectares of
farmland and 5 million hectares of forest lands were devastated,
and 1.5 million cattle were killed.
For Vietnam as a whole, the war resulted in some 1.5 million
military and civilian deaths, 362,000 invalids, 1 million widows,
and 800,000 orphans. The country sustained a further loss in
human capital through the exodus of refugees from Vietnam after
the communist victory in the South. According to the United
Nations High Commission for Refugees, as of October 1982
approximately 1 million people had fled Vietnam. Among them were
tens of thousands of professionals, intellectuals, technicians,
and skilled workers.
Data as of December 1987
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