February 2006

The Monthly Essays

Crouching tiger

By John Button
Crouching tiger
After years of struggle Vietnam’s economy is finally improving. But will the lights stay on?

At Nha Trang, on the central coast of Vietnam, a young man in uniform interrupts the European chaise longue potatoes sunning themselves on the beach. “May I,” he asks, “polish your sunglasses?” Usually they say yes; it’s not something you get at most five-star hotels. And it’s free. The young man is on the staff of the Ana Mandara Hotel, which provides this service – a service possible only in a low-wage economy. Two stereotyped worlds are reflected in those polished Armani sunnies. One is West and rich, the other East and poor. The lowest-paid tourist makes more in an hour than the polisher earns in a month.

Two kilometres from the Ana Mandara, atop a small hill, is Vietnam’s largest statue of Buddha. At the foot of the hill is the Long Son Pagoda and a monastery. Some ragamuffin kids squat on the ground, playing a game that looks like conkers. They’re concentrating, ignoring us completely. We are not ignored by two teenagers, a boy and a girl.

“Where you from? Where you from?”

”Uc,” we reply, pronounced “Oop”, and meaning “Australian”.

“Ow ya goin, mate?” they shout back. “We’ll show you round, mate.”

There seems no alternative. It is as if we’ve been taken hostage. I sense we’ll pay later.

The flight of 152 stone steps leading up to the Buddha feels longer than it is because of beggars: old men and women with gnarled hands and wizened faces, young women with babies, people with deformed or missing limbs, victims of bombs or landmines or Agent Orange. Our guides seem to suggest we should take no notice, not waste our time or money on such people. It is a relief to reach Buddha, sitting comfortably on a stone lotus blossom, the carved heads of eight martyred monks staring out from the base.

Our guides tell us that they and the younger children playing nearby are orphans, cared for and educated by monks. Would we like to buy some postcards: six for US$20? “Very expensive,” I say. “How would you like a donation instead?” The boy tells us donations are unacceptable. The monks expect them to earn their money. It would be fairer, he says, if I bought 12 postcards, six to support the orphan boys and six for the girls. We are dealing with a professional, and it becomes a complex negotiation. Somehow I finish up with no postcards and not much money. Orphans or not, Vietnamese street kids are pretty smart. They have to be.

I first went to Hanoi in 1990 as industry minister in the Hawke government. There were no hotels with standards comparable to those in wealthier countries. Tourists were a rare sight in Hanoi and Ho Chi Minh City, and practically non-existent in the poorer, politically unsettled towns of central Vietnam. In Hanoi, the old Metropole Hotel was being restored and we stayed at the State Guest House, a handsome French colonial building with antiquated plumbing and gloomy facilities, and stories of men’s socks being stolen at night by large rats. It was considered sensible to lock them in your suitcase before going to bed. In Ho Chi Minh City, the old French hotels such as the Caravelle and the Continental were run-down and scarcely habitable, except for ghosts – people like André Malraux, Somerset Maugham, Graham Greene. Foreigners stayed instead at the “Floating Hotel”, a painted-up hulk moored in the river, with pokey cabins and narrow passageways, its gangplank symbolically separating the visitors from the Vietnamese.

Today the two cities each boast at least half a dozen first-class hotels. Impressive modern airports have sprung up, and the revamped national airline has new aircraft that run on time. Tourism is a major economic contributor; in 2004 overseas visitor numbers rose by 25%. Few go away unsatisfied, for there is something magical about the place that goes beyond the imagery of motorbikes and conical hats. The people are friendly, the food good, the prices reasonable and it is a photographer’s paradise. Vietnam is a predominantly rural society, a meeting place of different cultures and harsh experiences. The simplicity and toughness of life holds a strange romantic fascination for people normally indoctrinated by Western lifestyle magazines.

Vietnam’s history is one of battles against foreign occupiers, of courageous uprisings and savage repression. A thousand years of Chinese occupation ended around the middle of the tenth century. The French colonised it in the 1850s and the Japanese, in a loose collaboration with a Vichy French administration, were a rapacious presence during World War II. Military resistance to the French occupation began in 1945 and ended with the defeat of the French army at Dien Bien Phu in May 1954. Then ten years of hostility between North and South Vietnam merged into the American War, which effectively lasted until the fall of Saigon in 1975. Later the Vietnamese army fought with the Pol Pot regime in Cambodia. In 1979 it repelled a Chinese invasion on its northern border.

The French believed in Empire. Vietnam was part of their destiny and they built things to last. As colonists they were oppressive and sometimes wantonly destructive, yet Hanoi owes much of its charm – villas, opera houses, handsome administrative buildings – to the architects of the French occupation. The French maintained fine boulevards, puppet emperors and a good education system for French nationals and wealthy Vietnamese. The legacy from the American War is less attractive. Nothing was built. A lot was destroyed. The heavy bombing and massive use of napalm and Agent Orange devastated the countryside. The extent of this destruction is sometimes overlooked: nearly 60,000 Americans and 250,000 South Vietnamese soldiers were killed, and a million of the Vietminh and Vietcong. Four million Vietnamese civilians were killed or wounded. Most of Vietnam’s infrastructure was destroyed or seriously damaged.

The locals don’t talk much about the war to foreigners, but it is impossible to overlook its consequences. You are reminded of it visiting the Buddha in Nha Trang, in museums and galleries, in bits of battered infrastructure, in the patches of devastated rural landscape, in the crippled and disabled people.

Fifteen years ago the reminders were even starker. My host, a Vietnamese government minister, had spent 35 years in a warring army – unusual training for a minister of a civilian government in peacetime. I asked Prime Minister Do Muoi about political prisoners and human rights. The question had been suggested in the briefing by Australia’s foreign affairs department. Do Muoi avoided answering it, and for the first time in our hour-long discussion he raised his voice impatiently. “In the American War,” he said, “United States planes dropped more bombs on our country than were dropped in the whole of the Second World War. Where were our human rights then?”

Vietnam has done time on the watch-lists of Amnesty International and other human rights organisations. Recently there have been allegations of discrimination by Vietnamese authorities against the Montagnard, an ethnic minority who live in the remote mountain areas. This issue involves a long history of cultural difference and poverty stemming from isolation, not unlike the history of Australia’s neglect of its Aboriginal minority. In addition to these alleged human rights breaches, criticisms are made of the one-party political system, particularly as it is nominally communist. Some observers merge the two criticisms, even though the first is based on humane values and the second on ideology.

The thirtieth anniversary of the fall of Saigon provided an opportunity last April for some right-wing revisionism. In an editorial headlined “Time to Take a Sober Second Look at Vietnam”, the Weekend Australian effectively apologised for its own opposition to Australian involvement in the war in 1965, when the newspaper was “barely a year old” and presumably suffering from some sort of infantile disorder. The silliest sentence read: “Today Vietnam rots in tyranny while its neighbouring democracies grow richer in freedom.” Which neighbouring democracies? Laos? Cambodia? China? Burma? Or, for that matter, Singapore or Thailand?

In Vietnam in 2006, the art of keeping out of trouble with the government is much the same as in other Asian “democracies”: avoid criticism of the one-party state. Carelessly expressed views about Ho Chi Minh’s legacy might also be a mistake. Apart from this people seem free to speak their minds, though few do. As one Australian living in Hanoi observes: “Most of them are too busy trying to make money.” Certainly one does not sense a society dominated by political or religious repression. This was not always so. The end of the American War marked the end of the struggle between North and South Vietnam, often simplistically characterised as a battle between “communism” and the “free world”. Ultimately the North won both the war and the hearts and minds of the peasant majority because Ho Chi Minh, its leader, was the most persuasive symbol of Vietnamese national sentiment.

The war left a legacy of bitterness, recriminations and reprisals. The train between Ho Chi Minh City in the south and Hanoi in the north was renamed the “Reunification Express”. It was, in fact, a slow train, and its symbolic name was well ahead of the reality. Internment and re-education camps were set up. Collaborators with the Americans and the former South Vietnamese government were harshly treated, and for a long time their families were discriminated against in access to education and employment. The bodies of South Vietnamese soldiers killed in the war were not allowed to be buried in war cemeteries, an issue that rankled throughout the 1990s. Thousands left the south as refugees, among them Australia’s first boat people of recent times.

In 1975, when the fighting ceased, Vietnam was a shattered, impoverished country. It had suffered 30 years of continuous war and would endure 20 more years of economic isolation and limited diplomatic recognition. Vietnam became increasingly dependent on the Soviet Union, which educated Vietnamese officials and provided financial assistance and advice. It is difficult to be positive about the Soviet contribution. Ho Chi Minh, who died in 1969, wished to be cremated and to have his ashes scattered in the Vietnamese countryside. Under the influence of the Soviets, the world’s great embalmers, Ho was embalmed and his body was placed in a mausoleum to be, like Lenin, a unifying symbol of struggle.

Soviet advisers attempted to push the economy into heavy industry, a strategy that failed. But in hard times the financial aid, which lasted until 1989, was crucial. By the mid-’80s, with the failure of rice crops, the Vietnamese people were close to starvation. Many got by on imported sorghum, which is usually used as pig food. In 1986, amid an atmosphere of ideological crisis, the governing communist party embarked on the process of Doi Moi, the “renovation” of the economy, introducing a move to market socialism and the return to private ownership of agricultural land. Slowly the reforms began to succeed.

Back in 1969, Sweden was the first Western nation to recognise the Vietnamese government and establish an embassy. Australia followed in 1973. Other nations waited for a sign from the Americans, who in 1993 finally ended their economic boycott, which had prevented financial aid from the World Bank and the International Monetary Fund since the late ’60s. Diplomatic recognition and the lifting of trade embargoes followed. In 1995 Vietnam joined the Association of South-East Asian Nations (ASEAN), and in 2000 US President Bill Clinton visited with a large business delegation. Vietnam was opening up to the world.

As in China, you still hear talk of “Marxist-Leninist points of view” and “a socialist-oriented market economy”; deference is paid to Ho Chi Minh’s “thoughts on socialism”; the Communist Party continues to provide “guidance”. But it’s sensible to look behind the rhetoric. There have been spectacular results in some areas and modest improvements in others. Vietnam is now the world’s second largest exporter of rice and has rapidly growing export markets in coffee, rubber, petroleum, horticulture and light manufacturing. This diversified export base helped Vietnam escape the worst consequences of the East Asian economic crisis of 1997. Last year the economy grew by 7.5%: not bad by international standards but too low, according to a Vietnamese government publication, “to narrow the gap between Vietnam and other countries in the region (probably meaning China). The rate is not a flash in the pan: Vietnam now has a growing, low-inflation economy with increasing overseas investment.

But it is still a poor country. Since the 1980s the government has shown a consistent commitment to social policy, with poverty relief its highest priority. The World Bank reported in April 2005 that poverty levels had fallen from 51% in 1990 to 14% in 2002. But a downbeat government report published in December 2004 gave a frank assessment of the challenges ahead: “The quality of education is low … People still face difficult lives and unsatisfactory incomes … Corruption and social evils have not yet reduced. Traffic accidents have decreased but the situation is still unstable and problematic. Order and security in some areas are still complicated.”

A couple of qualifications are needed. For foreign visitors, traffic issues in the bigger cities are more than “problematic”: motorbikes and scooters might be signs of growing affluence, but negotiating them is frightening. And no mention is made of bureaucracy, which is sometimes intrusive at the lower levels of government – a legacy, some say, of Confucianism and Soviet communism.

The National Assembly, which has a two-thirds majority of Communist Party members, sits for two or three months a year. It is largely a rubber stamp but there now seems to be genuine debate on some issues, particularly large-scale investment projects. The assembly provides an opportunity for public and occasionally trenchant questioning of ministers – something unheard of a few years ago. And in many areas of government Vietnam’s politicians have displayed a rare openness. While the existence of AIDS was played down in some Asian countries – China was in complete denial about it – Vietnam has had high-profile warnings and public health programs for years. A similar approach was adopted with SARS, and Vietnam was the first nation declared by the World Health Organization to be clear of the virus.

A Vietnamese proverb goes: “When we eat the fruit we remember those who helped us plant the tree.” Arguably, the saying works in Australia’s favour. In 1990 Prime Minister Do Muoi told me that Vietnam held no bitterness towards Australia for its participation in the American War. Australia, he said, had been “a puppet”.

In Vietnam’s darkest economic times Australia was better informed than most. Through its embassy, Australia supported various aid programs and some business activity. In the late ’80s the Overseas Telecommunications Commission, an antecedent of Telstra, rebuilt the Vietnamese international system. In 1990, on Australia’s behalf, I signed a Trade and Investment Agreement between the two countries. It was timely. By 1992 Australia had become the third-largest investor country. It has since fallen behind Japan and other Asian nations, but Australian markers still stand tall: the handsome ANZ Bank in Hanoi, the Foster’s brewery, the Australian-built My Thuan Bridge in the Mekong Delta, the thriving RMIT campus in Saigon.

Despite its ASEAN membership, one government official told me earlier this year that Vietnam remains a country “without strategic partners”. China, with its history of border skirmishes and incidents, is always something of a worry. In January 2005, the crew of a Chinese patrol boat shot dead eight Vietnamese fishermen. “What can we do?” an official asked. “Send a protest note?”

In June last year, Phan Van Khai became the first Vietnamese prime minister to visit Washington. He went with a similar message to those sent by Ho Chi Minh at the end of World War II. Ho was seeking aid and a strategic alliance, and he had reason to be hopeful; the Vietminh, led by Ho, was the only Vietnamese movement that had fought the Japanese occupation. But at the time Washington was preoccupied with other things. Asia was not a high priority. Twenty years later Vietnam became very important.

It shows every sign of becoming important again. This year’s APEC conference will be held in Hanoi. George W. Bush will attend, an undertaking he gave while Khai was in Washington. A government official told me that with Khai’s visit, Vietnam turned a new page in its history. Plenty of business was done; Bush and Khai’s meeting went on longer than scheduled. They did not talk about the war. Khai is quoted as saying that on human rights issues, “There was no pressure from the president. Vietnam has been reformed. We have a market economy. We have more democracy.”

If the ghost of Ho Chi Minh had risen from his mausoleum and watched this meeting through the windows of the Oval Office, he might have thought it looked a bit like the last scene in George Orwell’s Animal Farm.

Thirty years on from the end of the war, memories and bitterness are receding. The poverty, near-starvation and political repression of the mid-1980s seems a distant nightmare. In February 2005 more than 8000 prisoners were released in an amnesty, including Dr Nguyen Dan Que, a persistent critic of the one-party state who had spent 19 of the previous 26 years in jail. There is a sense of optimism and progress, a feeling shared among the estimated 2.5 million Viet Kieu – overseas Vietnamese – living mainly in France, Canada, the US and Australia. The amount of money and investment channelled into Vietnam by the Viet Kieu rises every year, and more people are returning home to visit relatives and friends.

As a Vietnamese-Australian friend of mine, a former refugee and the son of a South Vietnamese government official who was interned after the war, puts it: “Vietnam is making real progress. There’s no point in continuing to fight about the past. We should help to build the country.” Whatever their old differences, the Vietnamese are aware of their long struggle for an independent nation.

This attitude is best illustrated by Nguyen Cao Ky, the former vice-president of South Vietnam and militant anti-communist, who ended his 29-year exile in America by returning to his homeland in 2004. Some Australians will remember Cao Ky as the flamboyant Marshall Ky, dressed in an air-force officer’s uniform and sporting a white silk scarf, who visited Australia as a guest of the government during what we call “the Vietnam War”. Ky’s return trip to Vietnam last year was his first since leaving in 1975. He commented favourably on the country’s economic progress and infrastructure improvements. He thought the political climate more liberal than he had imagined; there seemed to be no religious discrimination. He has been back again and is now busily encouraging foreign investment. On a recent visit he announced his intention of returning to Vietnam to live. The Reunification Express is gaining pace.

In 1990, at the time of my first visit, Vietnam was one of the world’s poorest countries. Its infrastructure was a mess. Electricity was scarce. In Hanoi, children gathered under a single light suspended in the middle of the road to do their homework (the traffic – and there wasn’t much of it – went around them). When Lee Kuan Yew, the prime minister of Singapore, visited Vietnam in the early 1990s he advised against investing in the country. Who’d invest in a place where the lights can’t be trusted to stay on?

On one occasion Prime Minister Do Muoi, with a broad grin, revealed to me what he considered Vietnam’s biggest challenge. It can be paraphrased as: we’ve beaten the French, Japanese, Americans and Chinese in war, now we have to beat them commercially in peacetime. He conceded there was a long way to go. But perhaps he sensed that the economy had started to turn the corner. His less wary, more ebullient foreign minister, Nguyen Co Thach, liked to describe the world in images. Australia, he said, is a kangaroo. It is a progressive animal; it can only move forward. China is a dragon, to be treated with caution. And one day Vietnam will be a tiger. And that will be interesting.

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