1 Introduction
1. The Department for International Development has
funded projects in Vietnam since 1992. By 2001, DFID's programme
in Vietnam had a budget of around £15 million. In 2003, DFID
Vietnam became a devolved office, managing its own budget and
one of the fastest growing programmes in DFID.[1]
Today, DFID's budget in Vietnam has more than tripled to
over £50 million. In September 2006, Hilary Benn, then Secretary
of State for International Development, signed a ten-year Development
Partnership Agreement with the Government of Vietnam which commits
the UK to providing at least £50 million a year in aid until
2010.
2. In the light of this steeply rising budget in
a country where British development assistance is a relatively
recent innovation, we decided that this would be an opportune
moment to undertake an inquiry into British official development
assistance to Vietnam. The purpose of the inquiry was to examine
the scope, focus and effectiveness of DFID's programme in Vietnam,
and in particular the key challenges for Vietnam's development
including inequality and the two significantly off-track Millennium
Development Goal targets.
3. We held two evidence sessions in this inquiry.
On 19 June we took evidence from Ramesh Singh, Chief Executive
of ActionAid International, and Dr Martin Gainsborough, Director
of the Bristol-Vietnam Project. On 21 June we took evidence from
Gareth Thomas MP, Parliamentary Under-Secretary of State at DFID,
and Donal Brown, Head of DFID Vietnam. In May 2007 we paid a five-day
visit to Vietnam. We had discussions with the Government of Vietnam
and with donors and civil society in Hanoi. We visited Hang Kia
commune in the mountainous province of Hoa Binh, and Huong Van,
Pho Trach and Huong Xuan communes in the coastal region of Hué
(the programme is published as an Annex to this report).
4. We are grateful to DFID for facilitating a comprehensive
programme of field visits and meetings which provided us with
insights into the development challenges for Vietnam and the work
which DFID does to support Vietnam's development. We are also
grateful to others who helped arrange the programme, including
the Orskov Foundation and the people of Hang Kia, Huong Van, Pho
Trach and Huong Xuan communes. We would also like to express our
thanks to all those who provided us with information, formally
or informally, to assist us with our inquiry.
Background: Economic development
and poverty reduction in Vietnam
5. Poverty reduction in Vietnam in recent decades
has been remarkable. The proportion of those living on less than
$1 a day fell from 58.1% in 1993 to 19.5% in 2004. This has lifted
24 million Vietnamese people out of poverty.[2]
Rapid economic growth, underpinned by a programme of domestic
reforms, has been a major factor in this accelerated progress
on poverty reduction. Vietnam's Doi Moi ('renovation')
reforms, which began in the mid-1980s, opened the door to the
development of a private economy. The reform process continued
throughout the 1990s with particularly significant reforms to
land rights and further private enterprise reforms. It is largely
as a consequence of these reforms that Vietnam's economy doubled
in size during the 1990s and, despite the east Asian crisis of
the late 1990s, maintained a GDP growth rate average of 7.7% over
the period 1993-2004.[3]
The World Bank told us during our visit to Vietnam that growth
looked set to continue strongly.
6. During our visit to Vietnam, it was clear to us
that the Government of Vietnam was committed to harnessing rapid
economic growth to promote development. Ramesh Singh, the Chief
Executive of ActionAid International, told us in his evidence
that,
"the main driver behind the so-called reduction
in poverty within the system has been to allow the potential of
poor people themselves to be unleashed, the ability to invest
and own land. And production has grown significantly in Vietnam,
from less than 20 years ago being a net importer of food to being
the second largest rice exporter."[4]
1 Department for International Development, Vietnam:
Country Assistance Plan 2004-2006, January 2004, paragraph
D1.1 Back
2
Vietnamese Academy of Social Sciences, Vietnam Poverty Update
Report 2006, June 2007, paragraph 1.1 Back
3
Vietnamese Academy of Social Sciences, Vietnam Poverty Update
Report 2006, June 2007, paragraph 1.1 Back
4
Q 3 [Mr Singh] Back
|
