Author: David Brown
Nguyen Phu Trong and his proteges have consolidated their command of Vietnam’s ruling Communist Party and its government. Fuelled by foreign investment in manufacturing, the economy remains robust. The public, initially sceptical that the party-state’s campaign against corruption would endure, has been impressed as indictments piled up against a long list of senior officials and businessmen.
It has been three years since Trong foiled two-term prime minister Nguyen Tan Dung’s bid to supplant him as general secretary of the Vietnam’s Communist Party. These days hardly a whisper of complaint against Trong can be detected. The Politburo’s ascendency in matters of policy is once again absolute.
When, last September, state president Tran Dai Quang succumbed to illness, Trong’s colleagues accorded him the additional responsibilities of president. That includes oversight of the sprawling ministries of National Defence and Public Security. It’s a concentration of authority not seen in Vietnam for 40 years and a remarkable apotheosis for a Marxist-Leninist theoretician who toiled in obscurity for decades.
Trong is the first leader in a long time to make headway toward restoring the party’s image. Two years ago, the Vietnam Communist Party endorsed a list of 27 deviations, including not only ‘opportunism’ but also the notion that the Vietnamese party-state could ever evolve into a pluralist democracy. A soft purge of tainted cadres is well underway.
In striking contrast to the previous Dung era, Prime Minister Nguyen Xuan Phuc and the rest of Vietnam’s government have hewed closely to Politburo guidance. For the most part, they have managed state business capably. Policy remains steadfastly oriented toward integrating Vietnam into the world trading system. The economy’s expanded at over six per cent annually since 2015, and the Ministry of Finance seems to be getting a firmer grip on managing public debt that was mostly run up in the Dung years. After trailing well behind foreign direct investment growth for years, private domestic investment has risen sharply.
In Vietnam, like across most of Asia, IT-driven ‘Industry 4.0’ is the new mantra for smart economic growth. Together with the chair of the Party’s Central Economic Committee Nguyen Van Binh, Phuc convened a high-profile national forum in Hanoi last July to declare that big changes are coming — ‘we will soon board Ship 4.0, and we will not leave any of our citizens behind’. The Central Institute for Economic Management, the government’s think tank, has been tasked to develop an Industry 4.0 strategy.
Not all the economic news in Vietnam is good. Vietnam’s social safety net — in particular its promise of universal health care and free education at primary and secondary levels — is in tatters. Poverty remains endemic in rural areas, relieved for many only by low wage jobs at nearby industrial zones. Divestitures of chronically underperforming state-owned enterprises have slowed to a crawl. Farmland continues to be expropriated for a fraction of its market value on the fringes of Vietnam’s cities.
The Phuc government’s one great gaffe in 2018 was a proposal to establish special economic zones (SEZ) at three points on Vietnam’s long coast. China — huge, newly rich and uncomfortably adjacent — is the Vietnamese public’s perennial bogeyman. As the SEZ scheme neared confirmation by Vietnam’s legislature, a firestorm of popular complaint erupted on Social Media.
A broad swath of opinion perceived the scheme to be an open door for Chinese investors to gain an extraterritorial foothold in strategic locations. On 9 June 2018, protests moved from social media onto the streets of Vietnam’s major cities. By the end of the day, tens of thousands of demonstrators had been expertly dispersed by police. The government pulled back the SEZ proposal ‘for further study’. It may have already been given a quiet burial.
Amid the SEZ fuss, Vietnam’s legislature approved a cybersecurity law that was vigorously promoted by the Ministry of Public Security. A provision of the new law poses a dilemma for foreign social media providers like Facebook and YouTube. They risk expulsion from a large and lucrative market if they don’t agree to store detailed data on their Vietnamese users and make that data available to the police upon request. Though the new law went into effect on 1 January this year, a draft decree on its implementation gives companies until January 2020 to reach full compliance.
Already, however, Facebook is no longer a safe place for citizens who criticise the party-state. Hanoi is tightening its surveillance of dissenters, online and off. According to the 88 Project, the number of ‘prisoners of conscience’ in Vietnam has more than doubled since 2016. Courts are routinely meting out much harsher sentences than had been the norm. A Vietnam-based ‘advanced persistent threat group’ has deployed upgraded technology against websites and blogs that publish uncensored news and commentary. And the Ministry of Public Security seems to have granted local police a remit to arrest Facebook users who too actively post comments disparaging the party-state or, in the case of a young man in Nhatrang, just read them.
The argument that durable economic ‘success’ depends on evolving broadly based, independent civil society institutions is shaping up a classic test in fast-growing Vietnam, where the ruling party brooks no challenge to its monopoly of decision-making.
David Brown, a retired US diplomat turned freelance analyst, writes frequently on Vietnam and its neighbourhood.
This article is part of an EAF special feature series on 2018 in review and the year ahead.