Climate Change and Human Development in Viet Nam

2007/2008 Occasional Paper
By Chaudhry, Peter; Ruysschaert, Greet

Viet Nam is a low-income country, but has recently made spectacular progress in terms of both economic growth and poverty reduction. The official poverty rate has fallen from 58 percent in 1993, to 19.5 percent in 2004 (VASS 2006). Strong economic growth is likely to continue following recent accession to the World Trade Organisation, with increased international trade and direct foreign investment reinforcing Viet Nam’s progress towards middle-income country status. As Viet Nam continues to be transformed from a highly centralised command economy, to a more market based one, the urgent challenge is to ensure that the relatively equitable growth that has taken place to date is sustained. Inequality is already increasing, with growth and poverty reduction rates in remote areas markedly lower than those in and around the growth poles of Ho Chi Minh City and Hanoi, and this may have significant long term consequences for Viet Nam’s future ability to respond collectively to climate related vulnerabilities.