Discover North : Current issues

Along with China, North Korea, Laos and Cuba, Vietnam is one of the five remaining communist countries, a not-so-discreet group that accounts for a quarter of the world's population. In the center of Hanoi, a statue of Lenin has withstood all the vicissitudes of history. A large, docile beast, it can be climbed by intrepid children. Is Vietnam an anachronism? A fossilized country? Hasty judgments are immediately contradicted by the vigor of growth rates. Like new materials that combine antagonistic properties, Vietnam combines dogmatism in its political system with economic pragmatism. In the mid-1980s, the country embarked on Doi moi, or Renewal, a major economic reorganization based on private-sector development and foreign capital. Today, Vietnam is one of the world's most dynamic economies and, despite many uncertainties, the outlook for the coming years remains very optimistic.

State structure

The country is headed by a troika comprising the State President, the General Secretary of the Vietnamese Communist Party (VCP) and the Prime Minister. Since March 2, 2023, the State President has been Vo Van Thuong, who has retained Pham Minh Chinh as Prime Minister. Mr. Nguyên Phu Trong (b. 1944), whose health is failing, still holds the post of Party General Secretary.

Vietnam's political system is based on the primacy of the CPV, which boasts some 5 million members - an extremely small fraction of the population. Every instance of administration and power is coupled with a Party organ. Party and state are so closely interwoven that there is no real separation of executive, legislative and judicial powers.

Held every 5 years, the CPV Congress sets the pace for the country's political life. The 13th CPV Congress was held in Hanoi from January 26 to 28, 2020. On this occasion, delegates voted to renew the 200-member Central Committee, which, after negotiations behind closed doors, elected the 19-member Political Bureau and the General Secretary.

The CPV's Political Bureau is in fact the country's governing body. It intervenes on all major issues and entrusts the government with the operational management of its policies.

The National Assembly, elected for 5 years by direct universal suffrage (the overwhelming majority of candidates are CPV members!), is the supreme body of the State. The President of the State and the Prime Minister are elected by the National Assembly. The National Assembly will be chaired by Mr. Vuong Dinh Huê from March 2021.

Headed by the Prime Minister, the government is responsible for unifying the country's economic and social policy, and for administering the country in compliance with the Constitution and the law.

Dissent and repression

Arrests of opponents of the regime and detentions without trial are commonplace. Reports produced by Amnesty International, Reporters sans Frontières and Human Rights Watch are unequivocal about the intensification and harshness of the repression. Although political opposition cannot be openly organized, the Internet has enabled the emergence of numerous blogs, debate forums and social networks, demonstrating civil society's ability to mobilize around certain issues. Environmental issues are the most worrying, in terms of public health (air pollution, etc.) and human safety (food safety, pesticide contamination). The government's response is to step up repression of bloggers, but it is also forced to "negotiate" and come to terms with public opinion, which can rely on international relays. If not in the implementation of public policies, then at least in official discourse.

Geopolitical tensions

Chinese expansionism in the South China Sea (the East Sea for the Vietnamese) worries the Hanoi authorities, especially as, like environmental issues, it is likely to crystallize widespread discontent and mobilize the population on social networks and in the streets. In recent years, the country has been rocked by violent anti-Chinese demonstrations and riots. Vietnam is therefore constantly drawing closer to the United States, while knowing full well that it cannot distance itself from China, whose sensitivities it must spare. In July 2015, the General Secretary of the Vietnamese Communist Party, Mr. Nguyên Phu Trong, was welcomed by President Obama at the White House. In May 2016, the US President's official visit to Vietnam marked a new stage in the rapprochement between the two countries. Presidents Clinton and George W. Bush had previously visited Vietnam. But during his three-day visit (May 22-25), President Obama received an extraordinarily warm welcome from the people of both Hanoi and Ho Chi Minh City. In the wake of this visit, and still with the Chinese threat in prospect, we note the announcement by the President of the United States of the total lifting of the embargo on lethal weapons. The election of Donald Trump in 2016 did not mark any notable inflection in this trend towards rapprochement. President D. Trump visited Vietnam twice, in November 2017 and in February 2019, during the summit with North Korean leader Kim Jong-un. In 2018, James Mattis, the US Secretary of Defense, made two visits to Vietnam. On September 10, 2023, US President Joe Biden visited Hanoi in the hope of weakening China's influence in Asia.

Economic situation

The Vietnamese economy opened up in the late 1980s, when the country's leaders decided to turn their backs on the planned economy with the implementation of the Doi moi, or Renewal, policy. Success was spectacular. Faced with food shortages in the 80s, Vietnam is now a heavyweight in world agriculture. Along with India and Thailand, it ranks among the world's top three rice exporters. It is also the world's leading producer and exporter of pepper and second largest exporter of coffee. Extreme poverty has fallen from 50% in 1990 to less than 2% today. Since 2010, Vietnam has been a middle-income country. With GDP growth set to reach +5.05% in 2023, Vietnam is one of the world's most dynamic economies. This growth is mainly driven by foreign trade. Vietnam is considered the workshop of the Asia-Pacific region, and it's fair to say that today, we all have something Vietnamese about us: since 2012, telephones and their accessories have become one of Vietnam's main export items. The country ranks among the world's top 5 producers of footwear and leather goods, and among the world's top 5 exporters of textiles. Almost 80% of Intel processors for desktop computers are manufactured in Vietnam. This internationalization is the fruit of a deliberate policy of openness and trade integration. Vietnam has demonstrated a real commitment to trade liberalization in recent years. The country has been a member of the World Trade Organization (WTO) since 2007; of the ASEAN Economic Community since late 2015; of the Comprehensive and Progressive Agreement for a Trans-Pacific Partnership (TPP-11), which came into force in December 2018; and of several free trade agreements, including one signed in 2019 with the European Union, which still has to be voted on by the European Parliament to come into force. However, while past successes are undeniable, the country now faces new challenges. The gradual upscaling of the economy is essential to maintain Vietnam's competitiveness. Public finances, deteriorated by a rapid increase in debt in recent years, need to be put on a sounder footing. In the longer term, Vietnam will also have to cope with the consequences of a rapidly ageing population and its vulnerability to climate change. As a fast-growing economy, Vietnam needs to define an optimal energy mix. The large share still given to coal does not seem conducive to climate protection. Natural gas, an abundant resource in Vietnam, could, however, ensure rapid energy development while limiting greenhouse gas emissions over the long term. Finally, governance remains the main obstacle to a genuine clarification of perspectives, with the Communist Party's monopoly on the country's political, economic and social life thwarting the advent of the rule of law and providing a breeding ground for corruption.

The oil and gas sector

The exploitation of the country's hydrocarbon resources has played an important role in Vietnam's growth. The sale of oil and gas has contributed an average of 25% of government revenue over the past thirty years. Crude oil exports are a considerable source of foreign currency, enabling the country to build up hard currency reserves. The first oil field exploited by Vietnam dates back to 1986. The deposits are mainly located offshore, off Vung Tau in the south of the country. Exploitation of certain basins has been suspended due to sovereignty disputes in the East Sea. Vietnam's proven oil and gas reserves stand at 4.4 billion barrels and 600 billionm3 respectively, representing comfortable hydrocarbon reserves and 0.3% of the world's proven reserves. Lacking sufficient refining capacity, Vietnam exports crude oil and has to import more expensive refined oil. The development of processing infrastructures (refineries, petrochemical complexes, etc.) is therefore a government priority. As for gas, due to the absence of a network and liquefied natural gas (LNG) terminals, there is no international trade. But production and demand are set to rise sharply, as Vietnam has chosen to rely partly on gas as an energy source to meet its growing demand for electricity. Two LNG ports are currently under development. Mining resources are another major asset for the country: reserves of bauxite; rare earths, used in high-tech products and in the low-carbon industry; nickel, used in batteries for electric vehicles, etc. Exploiting these resources requires striking the right balance between making the most of them and respecting the environment.

Place of tourism

The tourism sector is one of the Vietnamese government's priorities, and is now emerging as a powerful growth driver. Its contribution to GDP is rising steadily, from 6% in 2014 to over 11% in 2018, with a forecast of 6.4% in 2024. Since 2010, the number of international tourists has tripled, from 5 million to over 15 million in 2018. The pandemic forced the country to close its borders to foreign visitors. In 2023, over 12.6 million foreign tourists visited Vietnam. Forecasts are optimistic with the extended validity of the various visas, and the country expects over 17 million foreign visitors in 2024. Where do tourists to Vietnam come from? In descending order: from South Korea (nearly 3.6 million visitors), China (1.7 million), Taiwan, the USA, Japan, Thailand, Malaysia, Cambodia, India and Australia... By 2023, the Asian market will account for more than half of Vietnam's total tourist demand (French customers, with 215,510 tourists in 2023, represent less than 2% of this demand), and professionals are wondering about the consequences of this dependence, the adaptations it will give rise to and the resulting offer. Will it be compatible with the tastes of customers from Japan, North America and Europe? In 2023, each foreign visitor will spend an average of 673 US dollars on a stay in Vietnam (compared with 1,503 US dollars in Thailand). Vietnam has not yet positioned itself as a leading destination for shopping or entertainment, which has an obvious impact on the revenues generated. The Vietnamese authorities also admit to a number of shortcomings that are hampering the growth of the sector: low quality of services and infrastructure, insufficient human resources, traffic accidents, etc. They have not yet put the sector back on track. They have yet to question a model that has led to the degradation of some of the most beautiful natural sites or to the "concreteization" of the coastline, which has been left to land speculation.

France in Vietnam

From the capture of Danang (1858) to the fall of Diên Biên Phu (1954), Franco-Vietnamese relations bear the imprint of a rich and tumultuous past. President Mitterrand's visit to Vietnam in 1993 gave new impetus to bilateral relations. France is a privileged partner of Vietnam and its main interlocutor in Europe. In September 2013, during a visit to France by Vietnamese Prime Minister Nguyen Tan Dung, the two countries signed a declaration of Strategic Partnership, which aims to strengthen the bilateral relationship over the long term and in all its dimensions, particularly political, economic, development, defense, cultural and governance. Political relations are punctuated by regular high-level meetings. On the French side, four presidential visits to Vietnam (F. Mitterrand in 1993; J. Chirac in 1997 and 2004; F. Hollande in September 2016); visit by Prime Minister F. Fillon in November 2009; visit by Prime Minister E. Philippe in November 2018. The education sector is an important component of the relationship. France welcomes more than 6,000 Vietnamese students every year. In healthcare, cooperation between France and Vietnam has resulted in the training of more than 2,500 doctors and specialists since the early 1990s. On the economic front, France has historically been one of Vietnam's biggest bilateral donors after Japan, with the French Development Agency (AFD) committing almost 2 billion euros since 1994, benefiting 30 million people, or almost one in three Vietnamese. Among the major French brands present in Vietnam are BNP Paribas, Total, Schneider Electric, Alstom Grid, Renault, Peugeot, Technip, Schneider Electric, Sanofi... More than 300 French companies are present in Vietnam in the form of companies, representative offices or joint ventures (around 26,000 jobs). Trade relations have not yet reached their full potential. Today, France buys from Vietnam 4 times more than it sells to it: for the year 2022, the balance of trade is in deficit by 5.7 billion euros. Exports remain concentrated in three sectors, which account for over 50% of the total: pharmaceuticals, chemicals and agrifoods. Aeronautical exports have been falling steadily since 2021. French imports from Vietnam are concentrated in two sectors: electronics (mainly telephones) and textiles-clothing. The European Union-Vietnam Free Trade Agreement, which has yet to be ratified by the European Parliament, should give French companies, especially SMEs, optimum access to a fast-growing market of over 98 million inhabitants. In 2023, the French community in Vietnam numbered 7,496 people on the register of French nationals living abroad, making it the largest group of European expatriates. With the number of non-registered French citizens estimated at between 25 and 30%, the total French community in Vietnam can be put at around 10,000.

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