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Generational Dynamics Web Log for 16-Sep-2020
16-Sep-20 World View -- Economic powerhouse Vietnam scrambles to recover from pandemic setbacks

Web Log - September, 2020

16-Sep-20 World View -- Economic powerhouse Vietnam scrambles to recover from pandemic setbacks

Marxist Socialism before Marx -- Vietnam's Tay-Son rebellion

by John J. Xenakis

This morning's key headlines from GenerationalDynamics.com

Economic powerhouse Vietnam scrambles to recover from pandemic setbacks

(I am currently writing a book on the history of Vietnam, following my books on the histories of China and Iran. Vietnam has a long, complex history, heavily influenced by both India and China. This article provides some advance information from the new book.)


Danang, Vietnam, on Aug 17. The city was on lockdown and thousands had been evacuated because of the pandemic.  (VOA)
Danang, Vietnam, on Aug 17. The city was on lockdown and thousands had been evacuated because of the pandemic. (VOA)

Up until the last two months, Vietnam was considered the undisputed economic powerhouse of southeast Asia. In 1986, the hard-core communist government saw that their Marxist Socialist policies were causing economic disaster, and they instituted the "Doi Moi" reforms that began to privatize government businesses, and reduced regulations on foreign direct investment (FDI). These capitalistic reforms have been extremely successful, and Vietnam's economy has shown spectacular growth for over three decades. Vietnam also benefited greatly from the US-China trade dispute, which caused may Chinese businesses to relocate to Vietnam.

Another reason for Vietnam's economic success is that its population is relatively young, a large percentage having been born since 1975, the end of the "Vietnam-American war." This especially makes Vietnam a large market for Japanese goods, with Japan's median age over 50.

Vietnam's economic success has depended on FDI and on global economic growth, but both of those have fallen sharply with the Wuhan coronavirus pandemic, with the result that Vietnam's economy has recently fallen off a cliff.

Both Russia and China were forced to abandon their Marxist Socialist policies in the past, in favor of capitalism and privatization reforms. The Communist Party of Vietnam (CPV) is trying to learn from the Russian and Chinese experiences, and keep its economic growth continuing, without making the same mistakes that Russia and China made and are making.

Unfortunately, there's a dark side to the CPV's economic reforms. The dark side is that they weren't accompanied by human rights reforms. Implementing economic reforms without human rights reforms means that CPV is no longer a Communist, Socialist or Marxist government, but instead has become a Fascist dictatorship. In this sense, it is following China's path, though not Russia's path.

Ironically, Vietnam has previously had a Marxist Socialist government for three decades in the Tay-Son Rebellion of the late 1700s -- decades before Marx was even born. This previous experiment with Marxist Socialism was a disaster, but unfortunately the CPV has not learned any lessons from that disaster.

Vietnam's successful fight against the Wuhan Coronavirus

Those who are hoping for a quick economic recovery in Vietnam are pointing to the country's successful response to the Wuhan Coronavirus pandemic, which is already in a "second wave" in Vietnam.

Vietnam had very few cases for months, using what was described as "cost-effectives" methods of virus control. These included health checks at airports and borders, strategic testing, contact tracing through mobile apps, effective public communication campaigns, and a national lockdown in April. On May 4, millions of students went back to school after three months at home, making Vietnam one of the first in Southeast Asia to ease movement restrictions.

The Vietnamese thought that they had the virus all but defeated. By July 25, Vietnam had remarkably been completely free of local transmission of the virus for almost 100 days, and had quickly isolated anyone entering the country with the virus.

But then a "second wave" began unexpectedly on July 25, with a new local transmission outbreak began in the coastal city of Danang, a popular tourist destination. By July 31, there were 82 new cases in a single day, more than half in Danang. On the same day, Vietnam reported its first death due to the illness.

So Vietnam quickly decided to evacuate 80,000 people from Danang, so that large-scale sterilization procedures could be set up to control the virus. From the Western point of view this is absolutely incredible, and it shows the difference between fascist governments like China and Vietnam, versus Western democracies, where those kinds of drastic measures would be impossible. They may all have open or partially open economies, but only a fascist CPV government could evacuate 80,000 people quickly from a city by force.

It may be that this drastic technique was successful, as there have been no new community transmissions in Vietnam for the last week.

There are concerns about whether Vietnam will successfully manage a new surge in the fall, but the Vietnam government expects to do so. According to a UN representative in Vietnam, "I am confident that the country will be successful in its efforts to once again successfully contain the virus, once more over the next few weeks."

Vietnam focuses on foreign investment and trade

It's been pretty clear for several months that Vietnam's economy is contracting sharply this year, thanks to the pandemic. Vietnam's Doi Moi reforms were designed to encourage foreign direct investment (FDI) and trade, and so its economy today is extremely dependent on global trade, with exports equivalent to over 70% of GDP.

The pandemic caused global trade to fall drastically, estimated at an 8% contraction in 2020. Thus, exports from Vietnam fell 12.1% in March from a year ago. This was followed by a 14% drop in April, and a 12.4% drop in May.

But the economy is coming back. According to research by Euromonitor, Vietnam ranks second out of 50 economies in merger and acquisitions attractiveness. Exports climbed 2.5% in August compared to a year ago, with shipments to the U.S. rising 19% in the first eight months of 2020. However, this is not all good news. Exports from domestic companies in August increased 18.3% year-on-year, while foreign companies in Vietnam experienced a 4.6% decline. Figures like these inevitably raise suspicions that the Communist Party of Vietnam (CPV) government is unfairly favoring domestic companies.

The CPV is taking numerous steps to restore economic growth, especially trade, as quickly as possible.

In June, the CPV ratified a free trade agreement with the European Union that will cut or eliminate 99% of tariffs on goods traded between Vietnam and the EU. The deal was controversial in Europe because of the CPV's human and labor rights record, although the agreement supposedly addresses those abuses. It will open up Vietnamís services, including post, banking, shipping and public procurement markets, align some standards and protect EU food and drinks, such as French champagne or Greek feta cheese, from imitations in Vietnam.

In the area of energy, Vietnam is currently working with ExxonMobil to develop the Blue Whale gas field off the countryís central coast, which has an estimated reserve of 150 billion cubic meters. Gas from this field will be used to run three gas-fired power plants slated to be built at the nearby Dung Quat Economic Zone.

In the area of manufacturing, Vietnam's primary industry of textile and garment exports fell 22%. The decline in global textile demand has led these businesses to manufacture PPE instead, producing nearly three billion masks a month.

Government heightened focus on high tech and artificial intelligence

The CPV is seeking to support high tech firms with a number of financial incentives.

High tech firms have not only seen their real estate fees reduced or waived completely, but have also been able to take preferential loans with half the general interest rate. SMEs with a revenue of 200 billion dong ($8.8 million) will also see a 30% reduction in corporate income taxes.

In Vietnam, the Communist Party owns all the land, and grants various individuals and businesses the right to use the land, in return for payments to the CPV. The CPV has reduced or eliminated real estate fees for high tech firms, and have granted them loans at low interest rates.

The CPV itself has invested heavily in the tech sector. Hanoi-based Viettel Group, the largest state-owned military telecommunications company, is investing $30 million in 5G labs to manufacture 5G chips en masse to create a national 5G infrastructure.

The investments have paid off. Dozens of AI tech firms were founded in the last two years, and Vietnam has an increasingly sophisticated workforce. Vietnam is also benefiting from the US-China trade dispute. A number of foreign high-tech firms are relocating their supply chains from China to Vietnam, due to cheaper production costs and geopolitical stability. These include South Korea's consumer electronics companies LG Group and Samsung Group. Dozens of Japanese companies have made similar shifts, including Toyota Motor Corp., Honda Motor Co, Panasonic Corp., and Canon Inc.

Australia's government is heavily supporting AI development in Vietnam. Through its Aus4Innovation program, Australia's Ministry of Science and Technology has already provided millions of dollars in funding for partnerships between Vietnamese and Austrailian institutions for commercialization of science and technology across Vietnam. New funding of almost half a million dollars is specifically targeted to AI applications to assist Vietnam's economic recovery after the coronavirus pandemic.

Human Rights

The economic future of Vietnam seems very bright, but there's also a very dark side to Vietnam, and that's in the area of human rights.

The CPV adopted the "doi moi" economic reforms for purely monetary reasons -- to encourage foreign investment that benefits the country in general and the CPV in particular, by keeping it in power. However, the CPV did not reform the harsh, abusive public policies.

Like the Communist Party in China, the CPV has a paranoid fear of religion-based rebellions. The thugs in both Communist parties consider themselves to be more important than their countries, or than anything. These are vicious, greedy, abusive dictators, scared to death that any sort of religious prayer would mean the destruction of the Communist Party itself, and the loss of their jobs.

In Vietnam, Christians and Buddhists are particular targets of CPV abuse -- arrest, torture, jailings or execution -- just for praying to their gods rather than to the Communist Party thugs.

This abusive behavior is quite widespread, but a particularly interesting example is the Christian Hmong ethnic group in Laos, just across the North Vietnam border in Laos.

The Vietnamese brutally massacred the Hmong in the late 1970s, even performing such atrocities as cutting off penises or widespread rape. The Hmong in Vietnam continue to be persecuted by the CPV because of their Christian religion.

There is a connection between the Hmong ethnic group and the death of George Floyd early in 2020 in Minneapolis at the hands of a white policemen, Derek Chauvin. Little has been reported about Chauvin's past, except that he's married to Kellie Chauvin, a former Mrs. Minnesota. She's an ethnic Hmong and a Hmong activist, born in Laos, but fled to Thailand and became a refugee in the late 1970s, when Vietnam was committing genocide. I haven't been able to find out whether the Hmong connection was related in way to the death of George Floyd.

Marxist Socialism before Marx -- Vietnam's Tay-Son rebellion

In one way or another, Vietnam has been around for millennia, and I will make no attempt in this article to even summarize that history. It is described in detail in my forthcoming book on the history of Vietnam.

However, there's one snippet of Vietnam's history that's fascinating now because of its relevance to today's world. It's about a three decade period in the late 1700s, when Vietnam tried Marxist Socialism, decades before Marx was born, with disastrous results as is always the case with Marxist Socialism.

The story begins in 1400 with the Ho Dynasty, Vietnam's most hated dynasty. In 1400, General Ho Quy Ly seized the throne and proclaimed himself founder of the short-lived Ho dynasty (1400-1407). He inflicted an enormous amount of suffering on the Vietnamese people, so much so that the landowners appealed to China's Ming Dynasty to intervene.

The Chinese took advantage of the situation. They invaded and took control, and inflicted even worse human exploitation than the Ho on the Vietnamese people, until they were ejected in 1428.

The Ho family came back with a vengeance in 1773, when three Ho brothers from the Tay-Son district launched a rebellion. It's apparently very easy to change your name in the Vietnam culture, and so they changed from the hated Ho name to the popular Nguyen name, although they were unconnected with the Nguyen family.

Their rebellion spread and gained strength quickly. Like all Socialists, the Tay-Son bought popularity by spending other people's money, starting by confiscating all the money of their own constituents. The Tay-Son governing chief principle and main slogan of the Tay Son was "seize the property of the rich and distribute it to the poor." In each village the Tay Son controlled, oppressive landlords and scholar-officials were punished and their property redistributed. The Tay Son also abolished taxes, burned the tax and land registers, freed prisoners from local jails, and distributed the food from storehouses to the hungry. As the rebellion gathered momentum, it gained the support of army deserters, merchants, scholars, local officials, and bonzes. It was essentially a modern-day Marxist Socialist government, though it existed long before the birth of Karl Marx.

Like all Socialist regimes, they soon ran out of other people's money. Modern day Socialist regimes turn to such things as drug dealing, extortion or dictators to gain income. They also starve, torture, jail and execute their political opponents still living in their Socialist Paradise.

The Tay-Son rebels aligned themselves with Chinese pirates. The targets of these Chinese pirates were Chinese commercial vessels. Among other things, this gave the Tay-Son (Ho) brothers revenge for the Chinese invasion in 1407 that removed the Ho Dynasty.

The benefits of the Tay-son - pirate relationship were mutual. The pirates required bases and safe harbors on land where they could sell booty, gain military and organization experience, careen and refit ships, and carouse, and the rebels provided that to the pirates, along with protection and legitimacy. In return, the rebels got the needed manpower and revenues to fight against the entrenched bureaucracy.

By the 1780s, the Tay-Son brothers were so destitute from their Socialist policies that they were completely dependent on the support of Chinese pirates. According to one historian, pirates "became a central feature of Tay Son naval strategy and indeed the regimeís economy between 1786 and 1802."

In the 1790s, a prince from the real Nguyen family, Nguyen Phuc Ahn, teamed up with French Christian missionaries and raised a mercenary army in India and defeated the Tay-Son government on June 1, 1802. The missionaries were willing to cooperate because the Tay-Son brothers were persecuting Christians.

Aftermath of the Tay-Son rebellion

Nguyen Phuc Ahn began a new Nguyen Dynasty in 1802. He changed his own name to Gia Long, and he changed the name of the country to Nam Viet. The Chinese didn't like that name for historical reasons. China recognized Gia Long as emperor of the new Nguyen Dynasty, but insisted on naming the country Viet Nam, the first time that name was used.

After a generational crisis civil war ends, the winning tribe or ethnic group continues the conflict by harsh, abusive treatment of ordinary people in the losing side after the war ends. Typically, the winning side fears a renewed uprising by the losing side, and they become paranoid and freely begin using harsh repression, torture and jailings.

Gia Long was no exception. His regime harshly repressed any political opposition that opposed the regime or the interests of the bureaucracy and the landowners. Pre-Tay-Son taxes were reinstated. Pre-Tay-Son prison punishments were reinstated, or were even more severe.

Gia Long followed strict "North Vietnam" Confucian style government principles. Buddhism, Taoism, and indigenous religions were forbidden, and these are characteristic of the "South Vietnam" culture.

Initially, the new government was friendly to the French Christians, since it was Christian missionaries that helped overthrow the Tay-Sons. However, the growing number of converts to Christianity -- 450,000 by 1841 -- with their disdain for Confucianism, were perceived as a critical problem by the regime. By the 1830s, the regime issued edicts that forbade the practice of Christianity, forcing the Christian communities underground. An estimated ninety-five priests and members of the laity were executed by the Vietnamese during the following quarter of a century.

Tensions grew, and in early 1861, a French fleet of 70 ships and 3,500 men reinforced Saigon, and in June 1862, forced Vietnam's emperor to cede Saigon and three provinces to the French.

France's navy continued traveling up the Mekong River, and by the end of the century had colonized all of French Indochina, their new name for Vietnam, Cambodia and Laos. The French remained in control until after World War II, and left completely after being defeated by human wave assaults at Dien Bien Phu in 1954. Once again, Vietnam was partitioned into North and South Vietnam.

Vietnam's future

The reason that I went into such detail about the Tay-Son rebellion is because it's being replayed today. "History doesn't repeat itself, but it rhymes."

North and South Vietnam were split in the 1760s. The Tay-Son (Ho) brothers started a harsh Marxist revolution that began in 1773 and lasted until 1802, with the result that North and South Vietnam were reunited again. It was followed by decades of severe repression and religious persecution. There would have been a new civil war around 1860 between North and South Vietnam, except that the French came and colonized the region. North and South Vietnam remained united until the French were ejected in 1954.

In 1954, after the defeat of the French colonizers, North and South Vietnam were again split. Another Ho, the dictator Ho Chi Minh, started a harsh Marxist revolution that began in 1954 and lasted until the reforms in 1986. It was followed by decades of severe repression and religious persecution, that are still going on today.

Vietnam may be united under control of the the CPV, but it is not culturally united. For centuries, there have been many wars between North and South Vietnam, and the core reasons haven't changed. This is clear from many blog posts online today that the people of Saigon (Ho Chi Minh city or HCMC) really do hate their CPV overlords and the people of Hanoi, while the people of Hanoi consider the people of Saigon to be sweet and nice, as if they were puppies.

The Vietnam-American war that ended in 1975 was just one more of a long series of wars between the Sinicized-Confucian culture in North Vietnam versus the Indianized-Buddhist culture in South Vietnam. From the point of view of Generational Dynamics, the time frame for a new civil war would be around 2035. However, just as the French invasion and colonization of French Indochina derailed the timeline for the civil war that would otherwise have begun in 1860, the current timeline could be derailed by an invasion from China or by a new world war.

In the meantime, "it is what it is," to use the trite phrase. You can visit Vietnam, you can work in Vietnam, you can live in Vietnam, provided you understand the rules. The rules are that the CPV is very harsh and oppressive, and saying or doing the wrong thing can get you arrested, tortured or deported. And even if you find a comfortable niche, the tensions and hostility between North and South are going to be worse every year.

Vietnam is an exciting, interesting place to live or visit, and it has a young, enthusiastic work force eager to succeed. Take advantage of those benefits as long as you can, and just follow the rules.

John Xenakis is author of: "World View: War Between China and Japan: Why America Must Be Prepared" (Generational Theory Book Series, Book 2), June 2019, Paperback: 331 pages, with over 200 source references, $13.99 https://www.amazon.com/World-View-Between-Prepared-Generational/dp/1732738637/

John Xenakis is author of: "World View: Iran's Struggle for Supremacy -- Tehran's Obsession to Redraw the Map of the Middle East" (Generational Theory Book Series, Book 1), September 2018, Paperback: 153 pages, over 100 source references, $7.00, https://www.amazon.com/World-View-Supremacy-Obsession-Generational/dp/1732738610/

John Xenakis is author of: "Generational Dynamics Anniversary Edition - Forecasting America's Destiny", (Generational Theory Book Series, Book 3), January 2020, Paperback: 359 pages, $14.99, https://www.amazon.com/Generational-Dynamics-Anniversary-Forecasting-Americas/dp/1732738629/

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