Vietnam: Assessing the achievements of Doi Moi

Following a decade of reform and the 1988–89 stabilisation programme, Vietnam appears well‐positioned to become a new East Asian ‘dragon’. Below, the main macroeconomic dimensions of the reform process are examined. In particular, improved terms of trade for food agriculture is seen as a key determinant of stabilisation; more generally, it is argued that the authorities have rightly given broad priority to macro‐stability over micro‐efficiency. While the process of institutional change is necessarily a lengthy one, rising domestic and foreign savings will help sustain rapid growth, mitigating any adverse distributional consequences of reform. The Vietnamese experience clearly contains lessons for other ‘market transition’ economies.