Who drives economic reform in Vietnam’s provinces?

Abstract

Vietnam keeps surprising the world with the speed and depth of its economic transformation. This research report suggests that the decentralisation of certain economic powers from central to provincial government has contributed to this success. Allowing provinces to find their own way forward was central to Vietnam’s progress in institutional and economic development. Decentralisation brought about a number of inefficiencies, but these are outweighed by the gains resulting from policy experimentation at the provincial level. The main question of the report is who drives the economic reform process in the provinces, exploring the role of business and government and alliances between the two. This is a difficult undertaking because it involves dipping into sensitive issues of state-business relations and because there are enormous variations between provinces and over time. Key to the feasibility of this project was the collaboration of IDS with the Vietnam Chamber of Commerce and Industry (VCCI)