Guidelines for Country: Vietnam - Essay Example

Vietnam: A Country Case Report History tells that Vietnam, as a communist country, has its doors closed from foreign interventions on belief that communal properties can adequately sustain the fundamental needs of its inhabitants. When Vietnam ordered the withdrawal of its troops from Cambodia in 1989, and after having signed the Paris Peace Agreement that restored the latter’s sovereignty, it signified the start of Vietnam’s integration to the new frontier. On purpose of prioritizing affiliation with neighboring territories, Vietnam joined the Association of South East Asian Nation (ASEAN) in 1995, and thereby of the ASEAN Free Trade Area (AFTA), and signed memorandum of understanding for commercial cooperation with the European Union (USA International Business Publications 121). Moreover, Vietnam consents to all efforts in support of its economic development and foreign investment (122). I. Entry to Globalization Despite moderation of trade barriers and enhanced diplomatic relations with more than a hundred territories worldwide, Vietnam remains true to the communist ideals. The Vietnamese Communist Party (VCP) still has control of election of government officials, from the highest to the most minor positions; and prohibits establishment of independent political, religious and labor organizations (USA International Business Publications 122). This is one practice that does not correspond with the concepts of globalization; yet seems to have worked well in Vietnam, perhaps because the greater part of its population trusts that it serves the common good. In this case, it is safe to assume that Vietnam recognizes the advantages of international trade but views all states as autonomous (Harrison)—meaning, interdependence may exist but it does not force all states to follow a resolute pattern of governance as was intended for the Washington Consensus. From the surface, this realistic philosophy of Vietnam towards foreign affairs, that is, making certain actions to open itself to globalization yet is not willing to share sovereign powers with other actors (Brawley 47), appears to provoke conflict among those that consider themselves dominant. Following the game theory perspective, however, this can be associated to a game of stag hunt—wherein cooperation among actors is the key to seizing the best price, although delegation of a leader or each actor deciding on its own strategy does not significantly affect the aftermath of the event. As mentioned earlier, Vietnam puts diplomacy at the forefront of all its ventures; and should there be a risk of tension due to common interest, it can adjust and settle for the rabbit instead. Vietnam’s dismissal of the reforms proposed by the International Monetary Fund (IMF) only implies that it is taking deliberate measures en route for globalization (Jacob). It is predominantly focused at strengthening its ties with neighboring territories—Cambodia, China and Laos, countries in South East Asia, and in the Asia-Pacific region (USA International Business Publications 121). Vietnam, standing by the Marxist theory of skepticism, could have inferred that industrialized countries exploit globalization to extend their dominance over developing countries (qtd in Nussbaum and Flanders 20), thus the need to team up with governments from the same region to fortify their shield against the blow. Further, Vietnam may not agree that increased economic efficiency associated with policies that reduce trade barriers or liberalize investment will eventually make everyone a winner (OBrien and Leichenko 89) as proponents of globalization claims. Because globalization takes competition to a broader extent, and that business opportunity is not shared but granted to a party offering more favorable terms (91), there is always one to end up a loser. In this point of view, it can be supposed that winners and losers are a natural inevitable, and evolutionary result of globalization. Nonetheless in the case of Vietnam, it attempts to avoid falling prey to forceful actors, thereby embracing the SPG notion that there is room for intervention and systemic changes which might alter patterns of winners and losers (94). II. After the Beijing Consensus Era In 2004, Joshua Cooper Ramo, a partner at the Kissinger Associates, coined the term The Beijing Consensus to refer to the modified version of the economic reforms proposed by the major financial institutions based in Washington, D.C. for developing countries, specifically China. It states that progress requires commitment to innovation and constant experimentation, that per capita income is not its sole determinant but also sustainability and equal distribution of wealth, and that a policy of self-determination and financial sovereignty starting with the adoption of asymmetrical military strategy should be pushed for (Zhu 53). Unfortunately, with the unforeseen collapse of the United States economy, China, its G-2 partner refused to take the lead in resolving international quandaries (Bremmer and Roubini). Likewise, the G-20 or the coalition of finance ministers and central bank governors of 19 countries and EU only turned into contending outlooks, posing a threat to global accord. Currently, we are at the age of G-zero where no single country or international federation has the political and economic leverage to administer design and performance of appropriate agendas. While many economies that rely heavily on espousal by the US government suffer a downfall following the Great Depression in 2010, Vietnam and the rest of the world that preserved sovereignty continue to thrive. In 2005 Vietnam’s GDP growth rate increased by 0.6 percent from the previous year, and scored second highest in East Asia (USA International Business Publications 39). The figures did not seem to fall back in 2009, while foreign direct investment rose from $6.9 billion in 2009 to $7.6 billion in 2010 (World Bank Group 85). This is attributed to the extensive efforts of the government to augment business conditions, particularly the promulgation of laws in support of international trade. Further, Vietnam ranked first in the Global Retail Development Index’s (GRDI) most attractive emerging market destination as per report by A.T. Kearney in 2008. The Harvard Business School asserts that competitiveness is based on productivity and the capacity of its industry to innovate and upgrade. Countries benefit from strong domestic rivals, aggressive home-based suppliers, and demanding local customers (Porter 171). Again, on account of the country’s success in terms of GDP and increased consumer demand for sophisticated retail policies, it can be deduced that Vietnam measures up to its developed counterparts. On the other hand, Vietnam does not hold competitive advantage in all aspects. The Central Institute for Economic Management (CIEM) envisage the depletion of natural resources in Vietnam in the year 2020. Energy is in the same state, and an imminent catastrophe in the absence of consistent national energy policy (Tan). Tan stresses that the country is to experience disparity in the supply and demand for energy resources, thus is expected to rely heavily on importation. Needless to say, fluctuations in the price of energy, oil and coal for instance, will adversely impact Vietnam’s economic status. Other developing countries in the Asia Pacific region are burdened by this limitation, and Vietnam, is not an exception. III. Amidst the Financial Crisis A large fraction of the Vietnam population found refuge outside its border for the opportunity to travel, work and study. Among the earliest migrants include 100,000 soldiers deployed in the Western Front during the World War I (Chuyen and Vuong 250). The government also encourage employment abroad in pursuit of economic stability (254). Such role of the diasporic groups of Vietnam is in relation to the transport of foreign currencies, especially US dollars into the country and other ways to give back to their country of origin (257). Nevertheless, the level of investment is contingent on how they perceive the country’s economic condition, the recipients of this undertaking, and the efficacy of affiliation with the local communities (251). While to reiterate, economic progress is only viable through collective growth in key areas, productivity by the diasporic groups of Vietnam is not enough. The financial crisis in 2008 has unfavorably impinged on the country’s financial market and capital mobility indirectly (Van 5). Investors are generally after the return of capitals, and when they find that Vietnam does not have the capacity to sustain their long term objectives, they are most likely to withdraw their funds and divert interest to other places. Nevertheless, Vietnam proved resilient amidst the setbacks brought about by economic volatility. In conclusion, exposure to international relations has shaped Vietnam in ways that defy the conventional philosophy. While other developing countries would implore assistance from powerful economies, Vietnam endeavored to maintain its own sovereignty and took prudent steps toward opening its doors to globalization. United States is not invincible after all, and surprisingly Vietnam flourished amidst the misfortune that befall majority of territories worldwide. Among the elements behind its success are the dynamic policies on foreign investments, ingenuity of business strategies, and the contributions of the diasporic groups. Works Cited Brawley, Mark. The Politics of Globalization: Gaining Perspective, Assessing Consequences. Toronto, Ontario: Higher Education University of Toronto Press, 2008. Print. Bremmer, Ian and Roubini Nouriel. A G-Zero World: The New Economic Club Will Produce Conflict, Not Cooperation. Foreign Affairs, March-April 2011. Web. Sep 30, 2011. Bureau of East Asian and Pacific Affairs. U.S. Background Note: Vietnam. US Department of State, June 3, 2011. Web. Sep 29, 2011. Chuyen, Kim and Vuong, Diep. Diaspora Giving: An Agent in Change in Asia Pacific Communities? Asia Pacific Philanthropy, 2011. Web. Sep 29, 2011. Harrison, Jacob. Vietnam: A Global Vietnam. Bauer Global Studies, August 6, 2010. Web. S.ep 29, 2011 Nussbaum, Martha C. and Flanders, Chad (Ed). Philosopical Topics: Global Inequalities. Fayetteville, AR: The University of Arkansas Press, 2002. Print. Porter, Michael E. On Competition, Updated and Expanded Edition. New York: Harvard Business School Publishing Corporation, 2008. Print Tan, Thie. Vietnam Deals with Energy Crisis Risk.Vietnam Chamber of Commerce and Industry, October 05, 2010. Web. Sep 29, 2011. The World Bank. World Bank East Asia and Pacific Economic Update 2010, Volume 2 : Robust Recovery, Rising Risks. Washington, D.C.: World Bank Publications. Print. USA International Business Publications. Vietnam Foreign Policy and Government Guide. Washington, DC: International Business Publications, 2008. Print. Zhu, Zhiqun. The Peoples Republic of China Today: Internal and External Challenges. London: World Scientific Publishing Co. Pte. Ltd., 2011. Print. Read More