The 1975 collapse of the Republic of Vietnam - commonly referred to as South Vietnam - ended
a three decade struggle to reunify the country.
The victorious North Vietnamese - led by the Communist Party of Vietnam or CPV - then embarked
on a series of economic measures to wipe away colonialist influence and bring socialism
to the country.
However, these measures failed to achieve their goals and the country tilted dangerously
close to a famine.
In this video, we are going to take a look at Vietnam’s economic struggles with land
reform and collectivization.
And how they regained their footing afterwards.
## Agriculture
At the founding of the Democratic Republic of Vietnam, commonly known as North Vietnam,
it would be hard to argue that the country wasn't in need of land reform.
Nearly every Vietnamese lived via agriculture.
And CPV documents found that 3% of the people owned 22% of the farmable land.
The CPV's economic policies at the time were in line with contemporary Communist doctrine
- dictating the collectivization of agriculture to eventually industrialize the economy and
solidify the party’s state power.
Land reform was considered a first, intermediate step towards this.
Theoretically, it would cleanse colonial-era exploitation, give land to the landless, and
eliminate the social bases of Communist resistance.
So in 1953 - about the same time Taiwan was carrying out its land reform program - the
CPV announced a land reform program where local land reform councils seized and redistributed
land owned by individuals it classified as "rich" or "landlords".
They were advised by members of the Communist Party of China.
North Vietnam's land reform measures did lead to paddy rice yields improving by 60% and
an expansion of cultivated land from 1954 to 1958.
But these gains came at the cost of social upheaval.
Mao's flavors of land reform pushed for struggle between the classes, leading to violence.
Furthermore, the definitions of who was "rich" were not very solid which encouraged arbitrary
punishments.
Estimates of how many "reactionaries" were killed vary.
One Politburo document from the time set a goal of about one execution per thousand people
- so around 15,000.
Western estimates generally cluster around that number - with additionally over 20,000
imprisonments.
We will probably never know the real number.
But in 1956, CPV officials made concessions in their speeches that "errors", "excesses",
and "injustices" occurred during their implementation.
## Cooperatives in North Vietnam
Having accomplished land reform, the CPV then established cooperatives, another step towards
full collectivization and the country's future industrialization.
Collectivization would bundle together farmers' efforts and have them work large-scale state-owned
farms to generate agricultural surpluses that the state could then use to fund industrialization
efforts.
In cooperatives, farmers performed collective labor and had to meet quotas set by Party
bureaucrats.
Farmers had all of their decisions made for them by accountants and administrators - two
of their most favorite people.
Knowledgable and productive farmers had no special decision-making voice - a problem
considering that people were so poorly educated.
A 1960 survey of 3,000 cooperatives found that 40% of cooperative members had just a
second grade education.
So as you might expect, the North's cooperative system never met its output requirements.
From 1959 to 1961, total grain output decreased by 1 million tons.
Land yields decreased 0.2 tons per hectare.
Over the same period of time, per capita grain production fell from 334 kilograms to 261
kilograms.
By 1975, that number would be 194 kilograms.
During the various wars for reunification, the CPV had to import up to 15% of its food
needs from China and the Soviet Union.
And even then, many people still went hungry.
The average Vietnamese farmer in the North consumed just 1,800 calories a day.
## Five Percent Plots
The CPV avoided a North Korea situation by early on permitting households to privately
produce crops on small plots of land referred to as "five-percent plots".
This 1958 policy was meant to be supplemental, but turned out to be a crucial crutch for
farmers to produce enough food for themselves.
By the 1970s, it was estimated that Vietnamese farmers earned as much as 75% of their income
from these tiny plots.
Yields on these five-percent plots were two to three times that of the much more massive
cooperative lands.
During the war, the CPV raised production quotas for the cooperatives while at the same
time lowering subsidies and drafting away men.
Cooperative managers became much more dependent on women labor and illegally tapped private
household plots to meet these demands.
## South Vietnam
Meanwhile in South Vietnam, the land inequality situation had become an urgent political issue.
Carrying out land reform policies was then-President Ngo Dinh Diem's top priority.
About a million South Vietnamese families - a third of the population - were tenant-farmers
without their own land.
They had to pay onerous rents - 25-50% of their income - to absentee landlords for the
"privilege" of working the land while bringing their own equipment and seed.
This ridiculous situation cultivated revolutionary feelings and threatened the government's hold
on power.
From 1955 to 1957, the President passed a land reform plan that somewhat reduced rents
and the tenancy rate, but not to a satisfactory amount.
President Ngo targeted 650,000 hectares from 2,200 landlords for redistribution.
After 10 years, just 275,000 was successfully redistributed.
Many considered this particular effort as a failure.
## Successful Land Reform
Western media frequently cited the land inequality situation as one of the reasons the South
Vietnam government couldn't win the hearts and minds of its people.
However in the regime's waning years, the government actually managed to pull it off.
In 1970, President Nguyen Van Thieu - today mostly known for overseeing the fall of Saigon
- passed new land laws with the backing of the United States.
This "Land to the Tiller" program succeeded where others had failed.
Landlords were paid 2.5 times the annual crop for their land.
Farming families received the redistributed land free, but had to cultivate it themselves
and could not sell it for 15 years.
Tenancy was abolished.
This land reform followed the successful examples of previous programs in Taiwan, South Korea
and Japan.
2.7 million acres of land transferred to 800,000 South Vietnamese families.
By 1975, 70% of the rural population in the productive Mekong Delta owned 80% of its land.
Combined with other agrarian measures - water control sites, fertilizer imports, pesticides,
and rural banks to issue credit for buying seeds - the South Vietnamese economy looked
set for a rebound.
Rice productivity increased from 1.92 tons per hectare in the two years after 1966 to
2.3 tons in the two years after 1973.
This land reform was a remarkable achievement.
But in the end, it all came too late to save the South Vietnamese government.
## Economic Struggles
Victory came at a titanic cost.
The new reunified Vietnamese government found itself needing to care for 10 million refugees,
1 million war widows, 880,000 orphans, and 3 million unemployed people.
Inflation ran at 900% a year, with rice paddies producing nothing.
War damage from unexploded ordinances and chemical warfare items like Agent Orange caused
countless damage to the Vietnamese people.
During peace talks in Paris, the United States had promised $3.5 billion in reconstruction
aid that it did not pay.
And insultingly, the US demanded that the new government repay the debts of the old
South Vietnamese government.
The US also imposed a trade embargo and sought to cut the country off from international
bodies like UNESCO, IMF, and the World Bank.
Ties between the two countries would not normalize until the 1990s.
This - in addition to a cutoff of food subsidies from China as Sino-Vietnamese relations started
to sour - impeded Vietnam's return to economic health.
It was a difficult time.
Amidst these conditions, the new Vietnamese government sought to create reconciliation
between North and South, improve the ailing economy, and - of course - establish socialism.
## Land Reform Redux
With Vietnam reunified, the CPV wanted to make the south to be in line with the north.
Driven by Communist orthodoxy, the new government wanted a transformation of capitalism.
In their belief, only Communist economic theory can take advantage of the southern region's
natural resources and light industrialization to build up a modern, strong Vietnam.
This revolutionary process starts with two components: Land reform and collectivization.
Land reform in the south - part 2 - began in 1976 with the party surveying and classifying
the people according to their wealth.
The richest - meaning to own over 7 hectares of land - were labeled exploitative capitalists.
This time, however, the Party did not carry out the land reform process with as heavy
a hand as they had in the North.
Probably due to the reforms from the prior government, food self-sufficiency requirements,
and a recognition that land reform in the North was mishandled.
But it failed to achieve its goals nevertheless.
Peasants in the war-torn South strongly resisted land appropriation - having suffered and fought
wars to get it.
Others transferred or "lent" their land to family members - often with the cooperation
of local officials.
## Collectivization
CPV officials like Le Duan criticized the South's status as a "fragmented" and "individualized
farming" area.
Such things, they believed, incentivized only subsistence farming and was too specialized
to contribute to the nation.
Collective ownership would fix this problem, bundling together the people's labor and channeling
it towards state farms that they presumed would be more efficient than individual farms.
Furthermore, the CPV can appropriate fertilizers, new seeds, and some 24,000 tractors for use
on the state farms.
The first step towards such large-scale agricultural collectivization would be the establishment
of production cooperatives.
Just like in the North.
And just like in the North, this effort struggled.
The state paid a price just one eighth of the market price.
Local South Vietnamese farmers both rich and poor resisted these efforts, slaughtering
their pigs and damaging their machines before appropriation.
The number of functioning tractors declined by 76% from 1975 to 1983.
There were reports of rice farmers feeding their crops to pigs or distilling it into
alcohol.
And this happened during a period of food shortages.
Workers showed up to the cooperatives but only did the minimum required work.
After that, they then rushed home to work their own fields - the ones that actually
mattered.
National rice production fell from 11.8 million tons in 1976 to 9.8 million tons in 1978,
just two years.
In 1980, the Party had planned for 21 million tons of rice production, but reached just
68% of that.
The rest of the agricultural sector did no better - with pig production hitting 59% of
goal, fishing 40% of goal, and logging 45% of goal.
And despite extensive state investment, Vietnam fell far short of its industrialization goals
as well.
Cement production hit 32% of goal, fertilizer just 28% of goal, and steel output 25% of
goal.
Vietnam's economy was grinding to a halt, experiencing low productivity, supply chain
difficulties, and implementation failures.
## Other Attempts
Vietnam's economic stagnation and lack of food production became a serious problem when
Vietnam invaded Cambodia in December 1978 to topple the Chinese-backed Pol Pot regime
and occupy the country for a decade.
At the time, this occupation had not been popular on the world stage.
China would in turn invade Vietnam a month later, triggering the brief Sino-Vietnamese
War.
In an attempt to raise food production, the CPV passed Directive 100 in January 1981.
Directive 100 allowed farming households to cultivate the large cooperative lands.
If those households managed to exceed an annual quota, then they can sell the excess crops
to the government at a higher price or on the free market.
This worked, but only briefly.
Cooperative managers and farmers evaded the spirit of the Directive by manipulating the
quota.
Dishonest cooperative managers also skirted the laws by charging extra fees and taxes
to unfairly skim away everything the farmers grew.
Corruption like this was not uncommon.
Local officials, far from the Party central in Hanoi, regularly violated Communist doctrine
by hiring laborers, smuggling goods, and selling state goods on the black market.
Finally in 1985, the national government passed another round of measures - over 300 measures
- in an attempt to stimulate the economy.
Central planners delegated price-setting authority to municipal trade bodies, who ended up picking
whatever price they thought was suitable.
The result was wild inflation that went as high as 800% in 1986.
Farmers abandoned the cooperatives and returned to household production.
The Vietnamese Army newspaper reported famines in eight of the north's 19 provinces, threatening
over 3.5 million residents.
Having come to power under the banner of nationalism and achieving reunification, the CPV's subsequent
economic mismanagement and hardship was harming its legitimacy to rule the country.
Along with their ongoing occupation of Cambodia, it exposed them to criticism from foreign
groups.
Faced with the prospect of famine and social unrest, the Party needed to "renew or die"
- as said by future CPV General Secretary Nguyen Van Linh.
And to their full credit, they did.
## Doi Moi
In 1986, CPV General Secretary Le Duan passed away.
His successors introduced a series of economic reforms without changing the political system.
A path similar to that taken by the Chinese.
These were collectively labeled the "Doi Moi" - meaning "renovation".
That year, households were allowed to work unused lands and privately raise livestock
without limits - a good step forward with some successes.
CPV high officials then visited the Soviet Union in 1987 and spoke with Gorbachev, who
urged Vietnam to reform and open up trade with capitalist countries.
Thus in 1988 the real reform came when the government abolished the requirement for farmers
to perform collective labor for the state.
They can own their land for up to 75 years and sell their wares to anyone on the public
market.
The cooperatives lost their monopolies on selling supplies and purchasing farmers' goods
- functionally disbanding.
They quickly vanished in the Mekong Delta, with their number shrinking from 292 in 1990
to 54 in 1994.
As one farmer recounts:
> "Before Doi Moi, you couldn’t grow what you wanted [because] the cooperative decided
everything.
Everyone had to grow one thing, even if other crops grew better or were more profitable
... Compared with 10 years ago, living conditions have improved five times over"
This essentially legalized what the farmers were already doing illegally.
Rice productivity exploded.
In 1987, Vietnam produced less than 242 kilograms of rice per person.
Two years later in 1989, that number rose to 293.
Vietnam had once needed to import its rice.
But it quickly became the world's third biggest rice exporter, going from 0.9 million tons
in 1988 to 1.95 million in 1992.
Today, Vietnam is tied with Thailand as the world's second biggest rice exporter.
This agricultural explosion laid the groundwork for further industrialization and economic
development.
From 1986 to 2006, Vietnam was Asia's second fastest growing economy - second only to China.
Poverty rates rapidly declined from 70% at the end of the war to 32% by 2000.
Per capita GDP increased 8 times over from 1992 to 2010.
## Conclusion
A consistent theme in this channel is that farmers work harder and get better results
when they are working their own lands and can reap the full economic benefits of what
they end up growing.
The series of land reform measures undertaken by the various Asian countries in the wake
of World War II forever changed their economies.
The South Vietnam land reform in 1970 came too late to save the country, but it nevertheless
set the stage for future economic development.
Even if that development was a bit delayed due to a few unfortunate bursts in agricultural
collectivization.
Vietnam's journey bears some similarity to the one taken by the Communist Party of China.
So it is of little surprise to me that the results have also been similar.