A Comparative Study of Governance

Reform Options for Vietnam To 2020

Drawing on the Lessons from Asia

Draft

Commissioned on behalf of DfID, UNDP and

VASS. First draft written by Dr Martin
Gainsborough, Director, Bristol-Vietnam
Project, University of Bristol, UK
Table of Contents

1. Executive Summary

2. Scope of the Study

3. Where is Vietnam now?

4. Globalisation and Governance

5. Civil Society, Rule of Law and the Market: Lessons from

Asia

6. Implications for Vietnam

7. Rethinking Governance Programmes

8. Suggestions for Further Research

Bibliography

Appendix

2
1. Executive Summary

• Drawing on the experience of other Asian countries, the study takes

a strategic look at Viet Nam’s governance options from now until
2020 in response not only to the economic and social changes
which are occurring domestically in light of doi moi but also as a
result of changes in the global environment dating back to the
expansion of transnational capitalism from the 1970s.

• The study is framed in the context of what Viet Nam is seeking to

achieve over the next 15-20 years, namely to: catch up with its
neighbours through a process of industrialisation and
modernisation; utilise the market mechanism while remaining
mindful of its dangers in terms of undermining social cohesion if it
is not properly regulated; build a cohesive and effective State;
strengthen democracy and participation; and maintain political
stability.

• Changes in the global environment associated with the expansion

of transnational capitalism have led to the integration of hitherto
nationally demarcated activities across state borders (so-called
globalisation). This can be seen in the rise of transnational
corporations, changes in respect of the financial sector and the way
in which production is organised, along with the emergence of
powerful institutions of global governance backed up by an
expanded body of international law (e.g. the World Trade
Organisation).

• Opinion varies greatly as to the significance of these developments

for nation-states. At one extreme, there are those who think the
state is being eclipsed. People who think like this talk in terms of
‘governance without government’. Others believe the effects of
globalisation are exaggerated and see the state continuing as before
while yet others argue the state is being effected by globalisation
but stress its inherent adaptability in the face of powerful global
forces.

• For us, talk of the state’s decline is premature and the state remains
crucial to any discussion of governance. Nevertheless, changes in
the global environment are having implications for how state’s
operate, including how they relate to their citizens who are
generally coming under a much wider range of influences than
previously, resulting in competing loyalties.

3
• Although liberal democracy is being pushed harder than ever in the
global market place of ideas, it is not the only political tradition on
which countries can draw and it is mistake to see all political
transitions as necessarily leading to liberal democracy as people in
the West often instinctively do.

• Pacific-Asia is itself home to a wide range of political regimes

which cannot be regarded as simply way-stations on the road to
liberal democracy. Nevertheless, many countries, including in
Asia, have introduced aspects of liberal-democracy into their
political systems alongside more indigenous traditions and in a
globalised world this may be the way forward.

• Elections have an important role to play in politics but they are

neither the only test of legitimacy nor the sole source of order in
political life. Instead, elections should be regarded as one of a
number of options within a ‘tool-box’ of possible approaches to
governance on which countries can draw, including citizen
deliberation in public policy making.

• It is widely accepted that rapid economic development of the kind

Viet Nam is experiencing – and of the kind that most countries in
Pacific-Asia experienced from the 1950s and 1960s onwards –
leads to the emergence of a denser civil society as economic
development precipitates social change.

• Experience from Asia also suggests that rapid economic

development is associated with the emergence of a more powerful
business elite and, often, a more vibrant labour movement. Social
change on the back of economic development can lead to greater
differentiation within the state itself, which needs careful handling
if it is not to be destabilising.

• Rapid economic development also poses challenges for social

cohesion, notably as rural-based populations leave the land to work
in cities, and as the economy is subjected to the vagaries of the
market mechanism, including the global market.

• Looking at the different ways Asian countries have responded to

these challenges, there are clearly better and worse ways to
respond. Some elites resisted change for too long, creating a
destabilising, ‘pressure cooker’ effect. South Korea and Indonesia

4
 are examples of this. Taiwan, by contrast, acted in plenty of time,
initiating talks with the opposition in 1986 before matters got out
of hand. This way, it was better able to negotiate the political
transition on its own terms.

• In countries where there is no opposition to speak of, consideration

has sometimes been given to whether the state should initiate the
formation of a second political party itself as a way of shoring up
legitimacy. In Singapore, for example, Lee Kwan Yew once
considered splitting the People’s Action Party in two as a means of
forming a second party although in the end he decided to pursue a
different course.

• Southeast Asia is home to a number of populist regimes (e.g.

Indonesia, the Philippines, Thailand). However, Asia’s populist
regimes are not exemplary role models since they are frequently
unstable as politicians make promises they are unable to keep
leading to dashed expectations on the part of citizens.

• Some commentators have argued that between destabilising

populism and what has been referred to as ‘dependent’ neo-liberal
regimes characterised by high levels of inequality, there is a
healthy middle way associated with social democracy. A social
democratic approach to governance appears to have much in
common with the underlying philosophy of the Communist Party
in Viet Nam.

• Civil society is often depicted in the liberal-democratic tradition as

performing a watchdog role in relation to the state. However, this
is not the only way civil society has been seen. In Asia, the
development of civil society is often viewed in terms of a state-led
strategy designed to maintain or increase commitment to national
development goals.

• A measure of autonomy for civil society from the state is important

but civil society’s relationship with the state has been characterised
in terms of a ‘disciplined partnership’. Civil society has also been
described as contributing to social cohesion and legitimacy;
smoothing off the rough edges of the market; and a means by
which the state shares responsibility with society (i.e. share’s the
burden of a country’s development).

5
• As with civil society, there are also differences in terms of how
people understand the rule of law. The liberal-democratic tradition
emphasises the independence of the judiciary from the executive,
suggesting, as with civil society, that it should perform a checks
and balances role. In parts of Asia, however, the judiciary has been
viewed more in terms of bolstering executive power. There is no
objective reason why states must follow the liberal-democratic
tradition in respect of law but there are questions to be asked as to
whether citizens who are now more influenced by liberal-
democratic ideas than they were in the past will always tolerate the
use of law as a means to bolster executive power.

• Looking to what Viet Nam might consider doing practically in

respect of governance in the future in order to build on the reforms
it has already undertaken, we believe that Baogang He’s idea of a
‘mixed approach’ to governance whereby tradition and modern
democratic practice are combined in order to build a firm and
broad basis for state legitimacy has much to recommend it.

• A mixed approach to governance has the advantage that it would

move Viet Nam away from legitimacy being overly dependent on
economic performance while simultaneously reaching out to a new
generation who are likely to be more concerned about ‘having their
say’ and more influenced by liberal democratic practices than the
older generation. At the same time, a mixed approach to
governance avoids becoming fixated on elections as the sole source
of legitimacy.

• As part of a mixed approach to governance, we believe that Viet

Nam should focus its efforts on the following six areas as it seeks
to design a governance programme as part of the Ten Year Socio-
Economic Development Strategy (2011-2020):
(1) Actively promote the development of civil society to serve as
a ‘disciplined partner’ with the state in the pursuit of national
development goals;
(2) Manage the emergence of a more powerful business class;
(3) Manage the emergence of a more vocal labour movement;
(4) Extend and institutionalise the process of citizen deliberation
in respect of public policy;
(5) Step up efforts to build social cohesion across a broad range
of fronts; and
(6) Consider ways to increase competition and widen the
franchise for the election of Party and Government positions.

6
2. Scope of the Study

This study has emerged as a result of discussions between the Viet Nam
Academy of Social Sciences (VASS), the UK Department for
International Development (DfID) and the United Nations Development
Programme (UNDP) in 2005-06.1 As is always the case with
collaborative exercises, it is possible to detect the influence of many
hands and the study has many parts to it. By way of a starting point, we
think it is useful to try and encapsulate what it is we are seeking to do
with a reference to a single statement or question. We believe that this is
best summed up as follows: ‘What are the governance challenges Viet
Nam is currently facing and likely to face in the future, and how might
the Communist Party and Government of Viet Nam, along with all
concerned stakeholders, work together to prepare for these challenges so
that the country’s can continue on its currently strong developmental
path?’

A second, obvious, point of departure for a study such as this would be to

define how we understand governance. However, this is in one sense the
whole point of the study, namely to think about what governance might
mean for Viet Nam going forward. It is important therefore not to pre-
empt this. How we understand governance will become clear as the study
unfolds but suffice it to say at this stage that we understand governance
broadly, involving both the state and the citizen, and the interactions
between them in the pursuit of the common good.

While we have highlighted the study’s main area of focus, it is possible to

highlight a number of additional foci in terms of what we are seeking to
achieve. First, while it is axiomatic to say that Viet Nam is undergoing a
process of rapid economic, social and political change associated with the
adoption of doi moi (renovation) in the second half of the 1980s and the
concomitant process of international integration, it is nevertheless true to
say that the study’s stakeholders recognise the complex and multifaceted
nature of this change process. It is widely recognised that changes in the
economic realm are a major driver of social and political change but the
causal chain, or how the different facets relate to each other, is not well
understood.

Furthermore, if we consider future scenarios, it is clear that most analysts

would be hard-pushed to lay out in any detail the range of possibilities

1
See the study outline in Appendix 1. It provided the final point of
departure for the work in addition to the Terms of Reference.

7
that Viet Nam might expect over the next 10-15 years. That is, should
Viet Nam simply expect an intensification of existing trends or simply
‘more of the same’? Or, is it possible to identify more precisely a range
of different outcomes which are not just ‘more of the same’ or an
intensification of existing trends? Having as much clarity as possible in
respect of these questions is crucial if the Party and Government are to
respond in an appropriate and a timely manner to the challenges Viet
Nam is facing.

The study’s stakeholders made a number of specific requests in terms of

what they wanted the study to cover. First, it was suggested that the
study be framed in the context of twenty years of market-oriented reforms
in Viet Nam. This has been understood in terms of probing how changes
in the economic realm, including the fact of growing international
integration, are impacting the country socially and politically. Here, the
fact of Vietnam’s membership of the World Trade Organisation (WTO) is
clearly important with its promise of greater economic openness and
more intense competition.

The study’s stakeholders also asked that the study focus on what
governance of the future will look like in Viet Nam with a view to
promoting more openness and democracy, notably through the
development of civil society and a state ruled by law. These are issues
which were flagged as being important at the Tenth National Communist
Party Congress in April 2006 and the study seeks to address the questions
they raise head on. In particular, we consider different ways of
understanding the role of civil society, its merits and de-merits, and what
one might do to encourage its development in a positive fashion and in a
way which is appropriate to Vietnamese conditions.

In the discussions surrounding the scope of the study, it was suggested

that if we are seeking to anticipate possible trajectories of change over the
next 10-15 years and the kind of policies that Viet Nam might adopt, then
it would be useful to draw on the experiences of other countries, notably
in Asia. This is a key element of the study, namely that it is a
comparative study of Asian experiences and their lessons for Viet Nam.
This is not to suggest that there is any one ‘model’ out there which Viet
Nam ought to follow hook line and sinker. To do this would always be a
mistake. Nevertheless, by adopting a comparative approach, we are
asserting that the process of change which Viet Nam is currently
undergoing is not unique – or at least not unique entirely. Whether it be a
process of marketisation, the shift away from a predominantly
agricultural society, industrialisation, urbanisation, or integration into a

8
competitive international economy characterised by increasingly free
movement of capital and rapid technological change, these are changes
that many countries have experienced or are experiencing, notably in
Asia. Of course, the consequences of such changes will never be the
same from one country to the next. However, it is likely that there will be
sufficient parallels for Viet Nam to draw some useful lessons from the
experience of other countries whilst not forgetting key differences
whether they relate to culture, history or initial conditions. Getting the
balance right between drawing on the experience of other countries but
not following it slavishly is important and serves as one of the key
premises on which the study is based.

Discussions between Asia and the West on political matters have not
always been very productive. The so-called ‘Asian values’ debate which
raged during the 1990s is a case in point.2 Often, one gained a sense of
people talking past each other, with Westerners stuck in a liberal-
democratic mindset and Asians asserting that their values were fixed and
immutable. Of course, there were valid points on both sides but the
problem was that such exchanges tended to flounder almost before they
had started as neither side really sought to understand the other. This
study, by contrast, seeks to move away from such an unhelpful position.
It advocates deep respect for different historical and cultural traditions –
including in Viet Nam – but also argues that no tradition is an island,
especially in an era of globalisation. A process of learning between
cultures is ongoing. Of course, it should never be one way – there is as
much the West can learn from Asia as the other way round. 3 However,
this process of learning is normal and should not be feared.

Writing on China, Baogang He has explained the country’s relative

success to date in respect of managing its political transition by saying
China’s leaders have adopted three principal methods: pragmatism,
gradualism and ‘nalaizhuyi’ (taking whatever best suits the occasion). In
this study, we strongly support this as an approach for thinking about Viet
Nam’s governance options in the years ahead.4 That is, as circumstances

2
For a study which discusses political change in Asia, although not
Vietnam, against the backdrop of the Asian values debate see Antlov and
Ngo 2000.
3
For example, consider the extent to which Japan has led the way in
terms of the emergence of contemporary ‘global’ production processes,
which has had a profound influence on Western firms as much as Asian
ones. See Beeson 2002.
4
He 2003: 313.

9
change, Viet Nam should rule nothing in and rule nothing out. Instead,
the key must always be to proceed carefully but to do what works.

Finally, the study’s stakeholders requested that the study be policy

relevant. That is, they asked that the study reflect on the appropriateness
or otherwise of existing governance programmes in light of the study’s
principal findings, suggesting ways that existing programmes might be
strengthened.

It is recognised that this is an ambitious study which seeks to synthesise a

large number of complex issues in a way which will be useful for a busy
government and practitioner audience. The study generally avoids
providing ‘background’ on Viet Nam’s political or economic system or
covering ground adequately covered by others, assuming the reader has
this knowledge already.5 It is also not concerned with the day-to-day
detail of individual governance projects. Instead, the study seeks to offer
a ‘strategic direction’ within which Viet Nam’s ‘governance programmes
of the future’ can sit and be developed. The danger with such an
approach is that in a bid to retain the ‘big picture’ we can sometimes
neglect to supply an appropriate level of detail to give life to our ideas. It
is hoped that we strike a balance in the report but where there are
deficiencies this is the reason. The study aims to be thought-provoking.
It does not claim to offer all the answers but rather seeks to provide
pointers in terms of possible ways forward and raise issues for further
discussion. In this respect, it is hoped that the study’s findings will be
useful in relation to the government’s deliberations on its Ten Year Socio-
Economic Development Strategy (2011-2020), possibly suggesting areas
for further research.

The study is structured as follows. We begin by asking where Viet Nam

is now, focusing especially on the government’s priorities (Chapter 3).
We are especially interested in understanding Viet Nam’s aspirations: i.e.
where does Viet Nam want to be in 20 years time? Chapter 4 considers
the global environment in which any governance strategy has necessarily
to be formulated. We consider the changing role of the state in a
globalised world and the consequences of the rise of non-state and
transnational actors. Although we recognise that states now operates in
an environment which is radically different from 20-30 years ago, we
reject the arguments of some commentators who argue that the state is
somehow less important. In Chapter 5, we look at how different
countries in Asia have responded to the governance challenges they have

5
For a good background report see Shanks et al 2004.

10
faced. We have looked at most countries in the region but focus our
attention here on those places which appear to offer the most promising
pointers for Viet Nam (China, Singapore, South Korea, Taiwan). Chapter
6 considers the implications of the study’s findings up to this point for
Viet Nam. It is here that we ask the difficult questions about what
practically Viet Nam might do differently in the future. Chapter 7
scrutinises existing governance programme in light of the report’s
findings asking whether existing programmes might need to be adjusted
or strengthened as a result. It also offers some final thoughts on how Viet
Nam might usefully conceptualise governance. Chapter 8 makes
suggestions for further research.

11
3. Where is Vietnam now?

For someone growing up in Viet Nam today, there is no doubt that the
country is a very different place from the one in which their parents or
grandparents grew up in. While for the older generation, life was marked
by economic hardship and the sacrifices of wartime, for the younger
generation both the war and the state subsidy mechanism are the stuff of
history books or what one sees in museums.6 Today, some 58% of Viet
Nam’s population were born after 1975. Around 28% were born after
1992.7 For this generation, the standard of living they are likely to have
and the opportunities they will potentially enjoy are very different from
that of their parents and grandparents. Whether it is the food people eat,
the clothes they wear, the household goods they purchase, how people
spend their leisure time, opportunities for travel and education, or access
to information and technology, the lives of the younger generation simply
do not compare with that of the older generation.

Of course, it is true that not everyone in Viet Nam is so well-off or

privileged. When thinking about governance reforms, we need to be
careful not to extrapolate simply on the basis of life in Hanoi or Ho Chi
Minh City and say the whole country lives like this. However, even life
in the countryside is not as it was twenty years ago insofar as rural
standards of living have generally risen, and in the face of rural to urban
migration, encroaching urbanisation, and improved infrastructure, life in
the countryside is also changing. Over the next two decades, the process,
which is already underway, whereby people leave the countryside to work
in industry and services as country develops is likely to intensify.
Economic development necessitates that this be so. Nevertheless, how
this process is managed is crucial to Viet Nam’s long term stability.

The social changes which will be precipitated in the wake of

industrialisation and modernisation will have profound implications for
just about every area of economic and political life one cares to think of
whether it be changing labour and gender relations, family life, how
people do business, the type of illnesses people suffer from as they get
richer, how people care for the elderly to what citizens expect of the state

6
The high-acclaimed exhibition recently staged at the Museum of
Ethnography entitled ‘Ha Noi Life Under the Subsidy Economy, 1975-86’
is a case in point. See http://news.bbc.co.uk/1/hi/business/5301086.stm
[last accessed December 14, 2006]
7
US Census bureau figures for 2005. See http://www.census.gov/cgi-
bin/ipc/idbsum.pl?cty=VM [Last accessed December 15, 2006]

12
and hence the very nature of the country’s political institutions
themselves. Already, it is possible to point to ways in which compared
with less than a decade ago citizens are interacting very differently with
the state whether it is increased intolerance of official corruption,
outspokenness in the media, or more active trade unions. In light of such
developments, it is possible – indeed some would say likely – that certain
approaches to governance which have served Viet Nam well to date will
need to be modified.

However, that is to get ahead of ourselves. First, we need to ask where

Viet Nam wants to be in 15-20 years time. And, equally importantly,
what is Viet Nam seeking to avoid (i.e. what kind of society does Viet
Nam not want to become?). Having a sense of where Viet Nam wishes to
go – and not go – is important since it will provide some useful
parameters within which this study can sit.

One way to gain a sense of what Viet Nam’s aspirations are is to look at
the five Political Reports prepared for National Communist Party
Congresses since the Sixth Party Congress in 1986 (i.e. 1986, 1991, 1996,
2001 and 2006). Another way would be to poll citizens directly but since
we currently do not have such information in anything like a
comprehensive format, we prefer the former approach. Surveying the
five most recent Political Reports also has the advantage that it offers us
continuity across time.

Looking at the Political Reports one after the other, it is striking how
many of the issues raised during the early ‘reform’ Congresses remain
salient today. This is both good and bad. It is good insofar as it indicates
consistency of purpose on the part of the Party both in terms of
identifying the problems which the country faces and in identifying ways
of tackling them. It is bad insofar as it indicates that certain problems are
still with us (e.g. excessive bureaucracy, a lack of respect for the law,
unclear institutional jurisdictions, or conflict of interest involving the
blurring of public and private roles). However, that such difficulties are
still with us is perhaps not surprising. Many of the issues, which Viet
Nam is grappling with economically, politically and socially, are complex
and notoriously intractable. Thus, for any country, it would be
unreasonable to expect them to disappear overnight or even in twenty
years. Moreover, Viet Nam has done extremely well maintaining political
stability through the early years of its transition.

The first point to make in terms of what Viet Nam is seeking to achieve
looking to the future is to catch up with its regional neighbours and the

13
more developed West through a process of industrialisation and
modernisation.8 Everyone knows that this is a tall order not least because
other countries are not standing still and because the rules affecting ‘late
developers’ like Viet Nam are probably tougher now than they have ever
been before.9 The Party has shown that it understands this clearly, noting
that while globalisation offers opportunities, it also presents challenges in
the form of heightened competition in the business realm, including
competition for access to natural resources, capital and technology, and
because there are now complex ‘global’ problems which are often beyond
the ability of individual states to solve.10

Focusing on the economy, the Party has indicated its determination to

build not just any kind of market economy but a Socialist-oriented market
economy, where the State:

“utilises the market mechanism and applies economic forms and

managerial methods of the market economy to activate production
and release productive forces, promoting the positive aspects of the
market mechanism while limiting and overcoming its negative
aspects”.11

With this aspiration in mind, the Party has indicated that it is concerned
about the potentially negative social consequences of reform and
particularly the dangers of utilising the market mechanism (“reality has
shown that the market economy itself is not a panacea”).12 This is
illustrated with frequent reference to the ever-present danger that the gap
between the rich and poor will widen. It can also be seen via reference to
other less attractive features of the market economy whether it is the
growth of user fees in health and education often to the point at which the
poor can no longer access these services, the rise of land disputes and
corruption, or a decline in certain ethical standards witnessed most
vividly in terms of a ‘get rich quick whatever the cost’ mentality in some
quarters. Against this backdrop, we have seen a clear commitment by the
Party to building a social security system aimed at protecting the weaker
members of society or those who have fallen upon hard times. The
Party’s social democratic credentials are very impressive and, according

8
Communist Party of Viet Nam 2006.
9
Wade 2003.
10
Communist Party of Viet Nam 2006.
11
Communist Party of Viet Nam 2001: 33-34.
12
Communist Party of Vietnam 1991: 103.

14
to some observers, quite unique for a country of Viet Nam’s income
level.13 However, we think that a key element of any future governance
strategy must be developing these social democratic credentials further.

Focusing on the political system itself, we can see a clear aspiration by

the Party going all the way back to the Sixth Congress in 1986 to clarify
the role of different agencies, whether it is the executive, the legislature
or the judiciary and their relationship with the Party. In the Political
Report to the Sixth Congress, there was a call for a move away from the
situation whereby “Party Committees at various levels run the whole
show, doing the work of state organs”.14 One can argue that it was out of
this assessment that the whole gambit of political reforms which we have
witnessed since the Sixth Congress emerged, including the all-important
amendments to the Constitution in 1992 (amended again in 2001), the
strengthening of the role of the National Assembly and the People’s
Councils, including the election by direct popular vote of the holders of
these offices, and the emergence of the Public Administration Reform
(PAR) agenda. At the Sixth Congress, we also saw the assertion of the
importance of the rule of law and the idea that all citizens are equal
before the law, which continues to be part of the governance agenda to
this day:

“The law must be strictly observed…As our Party is now in power,

all cadres in whatever positions must live and work in strict
compliance with the law, and be exemplary in observing the law. No-
one is allowed to make use of their power and influence to infringe
on the law. Any violation of the law should be brought to justice”.15

Viet Nam’s political reforms have also consistently emphasised the

importance of trying to mobilise as wide a cross-section of Viet Nam’s
citizens as possible to further the country’s development goals. Although
more work is needed in this area, efforts to realise this goal can be clearly
seen through the work of the Viet Nam Fatherland Front and the mass
organisations. Furthermore, it is in the Party’s efforts to mobilise as
many people as possible in support of development that we encounter the
notion of the “national unity bloc” embodying the idea that all patriots,
whether Party members or not, are encouraged to join together to develop
the country. Calls to encourage non-party members to help Viet Nam
achieve its development goals were heard most recently at the Tenth Party

13
Conversation with senior World Bank official, Hanoi, May 2006.
14
Political Report to the Sixth Congress cited in Thayer 1992: 114.
15
Ibid.

15
Congress in 2006 and it is good to hear the Party re-doubling its efforts in
this regard.16

Recently, an increased amount of attention has been paid to developing

democracy in Viet Nam. This was beautifully encapsulated in the
comment of the former Party General Secretary Le Kha Phieu, made to
the media at the Tenth Congress, that what Viet Nam needed was
‘renovation’ (doi moi) in the area of democracy ‘in the same way that
Vietnam launched reform in the economic sphere twenty years
previously’.17 However, reviewing the five Political Reports since 1986,
it is evident that developing democracy is not a new theme.
Nevertheless, it is important to be clear what the Party means by
democracy because the term is understood differently in different parts of
the world.

When the Party in Viet Nam – or in China – talk about democracy, they
are not thinking about liberal democracy or multiparty democracy.
Rather, they are thinking in terms of Socialist, or one-party democracy,
which drawing on a long intellectual tradition places special emphasis on
the leadership of a vanguard Party, maintaining order, and ensuring that
the interests of all citizens not just the well-off are served. It is in relation
to the latter point that the traditional Marxist critique of liberal democracy
lies insofar as it is viewed as bourgeois democracy tending to serve the
interests of only a narrow section of society. Vietnamese and Chinese
political culture is, however, not just influenced by Marxism but also by
Confucianism which further underpins the focus on maintaining order.
The Confucian influence can be clearly seen in South Korea and
Singapore as well.18

Perhaps the clearest exposition of how the Party in Viet Nam understands
democracy was made at the Seventh Congress in 1991 when in light of
the turmoil associated with the collapse of Communism in Eastern
Europe and the former Soviet Union, there was increased pressure in
some quarters for Viet Nam to follow a liberal path. By way of a
response, the Party wrote:

“…we reaffirm our will to constantly broaden Socialist democracy;

but to promote democracy in the right direction and successfully, this
process should be properly led, with steady progress that is

16
Tuoi Tre April 19, 2006; Thanh Nien April 24, 2006.
17
Tuoi Tre, April 17, 2006.
18
Armstrong 2002; Gainsborough 2002; Rodan 1992.

16
 appropriate to the general political and social situation. Only in that
way can we really guarantee the people’s right to mastery and
mobilise the entire people to take part in the building of Socialism.
Pursuing extreme liberal demands, practicing democracy without
linking it in with order and discipline or without sufficiently taking
into consideration the political and social situation, would only
prevent good intentions about the promotion of democracy from
being successful, on the contrary, this would lead to consequences
harmful to the people’s interests”.19

Moreover, it is in relation to this tradition that we should understand the

Party’s moves to develop ‘grassroots democracy’ from the 1990s
embodying direct popular participation and based on the principle “the
people know, the people discuss, the people act, and the people inspect”.
The term “grassroots” refers to production units, government agencies
and commune-level administrative units.20 Realising democracy at the
grassroots is clearly very important and is likely to remain at the heart of
any future governance strategy. The key will be doing it better.

Beyond how it understands democracy, the Party has also articulated over
the years an approach to change more generally. This includes – the
Party would assert – an openness to new ideas, being respectful of
different opinions, and a recognition that there are some values common
to all humankind – what was referred to at the Seventh Congress as the
“cultural quintessence of mankind”, which Viet Nam also aspires to.21 At
the same time, the Party has emphasised the importance of preserving
Vietnamese cultural traditions, of not negating the past entirely or
jumping from one extreme position to another but instead carefully and
pragmatically building on what is good, learning from other political
traditions, where appropriate, in order to create something better and
more suited to a rapidly changing society. Such aspirations are clearly to
be welcomed. Nevertheless challenges remain in this area if all sectors of
Vietnamese society – including critical ones – are to be allowed a voice.22

19
Communist Party of Vietnam 1991: 104
20
See also Vasvakul 2006: 143.
21
Communist Party of Viet Nam 1991: 128.
22
Different elite attitudes to criticism go to the heart of some of the
differences between Asian and Western thinking in relation to
governance. Specifically, this links up with different elite ideas as to who
‘the people’ are, and, importantly, who is viewed as ‘beyond the pale’ and
hence not constituting ‘the people’ and consequently having little or no
rights. However, it is this kind of difference that needs to be worked

17
Looking at Viet Nam’s reforms in their entirety, we can see that the
approach to change articulated above has been a major influence: that is,
gradual change, often preceded by a period of experimentation before
policies are rolled out nationwide. Such an approach is understandable.
Viet Nam more than most countries knows the cost of instability and
disorder while political stability, which has been one of the great success
stories of the doi moi era, needs to be maintained if the country’s
ambitious development goals are to be achieved.

through as part of any governance strategy worth its salt as part of

building more harmonious relations at home and abroad. For a useful
discussion of these issues in relation to Cambodia see Hughes 2002.

18
4. Globalisation and governance

In this chapter, we assess some of the changes which have occurred in the
global environment over the last thirty years or so and consider their
implications for governance. At this stage in the report, we will examine
these issues generically in order to introduce the reader to some new
ways of thinking about globalisation and governance, particularly ways
of thinking which may be unfamiliar in Viet Nam. We will consider the
implications for Viet Nam of the arguments advanced in this chapter later
in the report although, where necessary, we highlight their relevance for
Viet Nam in this chapter too.

One of the weaknesses with much of the globalisation literature, which is

vast, is that its focus and conclusions sometimes display a bias to the
developed world, North America and the West. Thus, its findings are not
always relevant, or relevant to the same extent, to developing countries.
Moreover, some of the arguments made about how the world ‘is’ are in
fact based on how people would like the world to be and hence can be
seen to be politically motivated. Thus, when reviewing the globalisation
literature, we need to ask ourselves first ‘Are its assertions true?’ and
second ‘Do they apply to Vietnam?’ An important aim of this chapter is
to work through some of these questions.

So, what are the changes in the global environment which we are
concerned with?

The changes that we are concerned with have to do with the expansion of
transnational capitalism dating back to the 1970s. As the globalisation
literature is at pains to point out, this is not the only dynamic of change in
the global environment. Technological change, ideology and political
decision-making are also important.23 Nevertheless, the expansion of
transnational capitalism associated with the growth of offshore money
markets from the 1970s is of critical importance if we are to understand
the kind of world we now live in.24

More specifically, when we talk about changes in the global environment,

we are talking about the integration of hitherto nationally demarcated
activities across state borders. This can be seen in the rise of
transnational corporations, which have exploited developments in
communications, transport and the organisation of the production process

23
Held 2000: 12.
24
McMichael 2000.

19
itself to transform the underlying logic of production in the economy.
Production is now described as being ‘vertically integrated’, which means
that a single company or conglomerate often controls each stage of the
production process from the design process through to assembly and
ultimately to the sale of a finished product. As is well known, different
parts of the production process can be outsourced and frequently occur in
more than one country.25

Aside from production, we have also seen profound changes in respect of

the financial sector, which has grown in size and also become integrated
across national borders.26 It was at least in part this ‘open’ financial
sector – specifically too hasty capital account liberalisation – which
caused so many Asian economies such severe problems during the
financial crisis of 1997-98. This led to a rethink not only in terms of the
risks associated with open financial markets but also in terms of the best
way to sequence liberalisation in this area.27

Both connected to and distinct from changes in respect of production and

the financial sector, we have also witnessed radical changes in terms of
the rise of transnational and non-state actors. The rise of transnational
corporations, as mentioned above, is part of this but we have also seen the
emergence of new institutions of governance with global remit and
backed up by an expanded body of international law. Perhaps the best
example of this is the World Trade Organisation, which now incorporates
a far wider range of areas than just trade in its remit and seeks to regulate
the activities of its member states in ways which would have been
unheard of twenty years ago.28 Other examples of transnational
governance would be credit ratings agencies, international organisations
which produce competitiveness and corruption indexes, and organisations
like the International Labour Organisation and the UN Office on Drugs
and Crime, which have seen their remit expand greatly in recent years.
As is well known, developing countries are under tremendous pressure to
respond, conform and generally ‘open up’ their domestic institutions in
response to the kind of things such organisations say and do. Of course,
there are good why it is in the interests of developing countries to work
constructively within such frameworks. However, there are also risks
which need to be managed.

25
Cheshier et al 2005; Cumings 1984; Felker 2003; Gereffi 2000.
26
Beeson 2003.
27
Wang 2006.
28
Wade 2003.

20
Along with the rise of transnational corporations and transnational forms
of governance, other commentators have drawn attention to the rise of
new social movements, understood in terms of social groups which
organise across national borders.29 Greenpeace, Amnesty International,
and some of the groups associated with the anti-globalisation movement
which came to the fore in the late 1990s, are good examples. The rise of
new social movements is also indicative of the kind of changes we think
it is important to highlight when considering changes in the global
environment although how relevant new social movements really are in
respect of many developing countries is a matter of debate.30

In defining globalisation, which as we have shown is multifaceted, many

commentators have emphasised this idea of ‘interconnectedness as
capturing something of what globalisation means. Others have talked
about ‘impact’, highlighting the way in which even the most local
developments can have enormous global consequences.31 The global
impact of local events is frequently in evidence. For example, when
SARS (Severe Acute Respiratory Syndrome) broke out in Asia in 2003, it
quickly spread to more than two dozen countries, largely as a result of air
travel. Moreover, how domestic governments dealt with the problem of
SARS quickly became an international issue regarded as being not just
within the purview of the World Health Organisation but other national
governments too.

The next question, which follows from this analysis, is ‘So what?’ That
is, if these are the changes that the world has seen, what are their
implications for governance?

Perhaps not surprisingly, there are nearly as many views about the impact
of globalisation as there are definitions. However, there are three distinct
‘camps’ which we are worth highlighting in a bid to organise our
thoughts. They are the hyperglobalisers, the sceptics, and the
transformationalists.32

Hyperglobalisers subscribe to a radical view of globalisation. Their

standard bearers are people like Kenichi Ohmae with phrases like a
‘borderless world’.33 As one might expect, hyperglobalisers also paint a

29
Sklair.
30
Gainsborough 2007.
31
Held 2000: 11-16.
32
Ibid.
33
Ohmae 1990.

21
dramatic picture of globalisation’s effects. In particular, they see the
nation-state as having passed its heyday, arguing that the state is
increasingly powerless to act in the face of powerful private actors and
new transnational forms of governance. Hyperglobalisers tend to stress
the constraints on national governments in terms of economic policy
options, arguing that this has compromised sovereignty and, amongst
other things, led to the retrenchment of welfare policies. A favourite
phrase of those associated with this camp is ‘governance without
government’, which is used to emphasise belief in the supremacy of new
forms of political power, which it is argued has left the state trailing its
wake.34 As Held writes, summarising this position:

“For the hyperglobalisers, globalisation defines a new epoch of

human history in which ‘traditional nation-states have become
unnatural, even impossible business units in a global economy’.
Such a view of globalisation generally privileges an economic logic
and, in its neoliberal variant, celebrates the emergence of a single
global market and the principle of global competition as the
harbingers of human progress…In this ‘borderless’ economy, national
governments are relegated to little more than transmission belts for
global capital or, ultimately, simple intermediate institutions
sandwiched between increasingly powerful local, regional and global
mechanisms of governance”.35

Sceptics, by contrast, tend to argue that the globalisation both as an idea

and a process is exaggerated, and that its impact is nothing like the
hyperglobalisers say it is. In particular, sceptics view the state as
continuing to be very important. Those who suggest otherwise often have
a political axe to grind, they say.36 Sceptics also point out that the rules
which govern international trade or the free-flow of capital did not just
appear out of nowhere. Rather, they were put their by national actors,
again emphasising the continued importance of states.

Somewhere in between the hyperglobalists and the sceptics one finds the
so-called transformationalists. In contrast to the sceptics,
transformationalists argue that the world is indeed a very different place
in the era of globalisation. However, they are ambivalent about how
precisely it is different, arguing – quite correctly – that this varies from
place to place, making generalisation difficult. In terms of the state,

34
Rosenau and Czempiel 1992.
35
Held 2000: 3.
36
Hirst 1997.

22
transformationalists neither say that the state is being eclipsed nor that
there is no change at all. Rather, they talk in terms of power being
‘reconfigured’. However, the transformationalist thesis is a relatively
optimistic one in terms of its view of the state in that it draws attention to
the inherent adaptability of states in the face of globalisation and the rise
of new forms of transnational and non-state power.37 Linda Weiss, who
has written extensively on the state in an era of globalisation and is
associated with the transformationalist camp, writes that globalisation is:

“not only, or even generally constraining [the state]. For

globalisation also contributes to the expansion of governing
capacities through both the transformation of public-private sector
relations and the growth of policy networks.”38

Writing on Africa but in a way which is relevant for many other

countries, Beatrice Hibou has coined the phrase ‘private indirect
government’ to capture the idea that even as states appear to concede
power – through privatising public assets, for example – they in fact
continue to exercise it albeit through other means.39 The point is that how
the state is responding to and being changed by globalisation is much
more complex than it superficially appears.

While all three positions highlighted above inevitably contain seeds of

truth, we believe the position of the sceptics and transformationalists is
most useful. As the sceptics suggest, it is important to look critically at
what has actually changed rather than taking at face value some of the
wilder assertions about globalisation. This is especially the case when
one considers the impact of globalisation on governance because it is
crucial not to take at face value what the state can and cannot do in the
present era. However, transformationalists are also correct when they say
that although it is mistaken to write off state power, the state is by no
means unaffected by changes in the global environment.

If then the sceptics and the transformationalist both make valuable points,
the next question to ask is what has actually changed in the world which
may have implications for Viet Nam, and more importantly, what has
changed that may have implications for governance?

37
Taylor 2005.
38
Weiss 2003: 19.
39
Hibou 2004.

23
Within the literature on globalisation, we have identified a number of
different of trends or ways of thinking about the world, which we believe
are worth thinking about when considering changes in respect of
governance. The areas we cover below are not exhaustive but they
represent a start and will be explored further as the report develops.

The first trend we wish to highlight is the invasiveness of a particular

kind of global power in the post-Cold War era. This can be linked in part
to a spirit of triumphalism following the collapse of Communism in
Europe and the former Soviet Union. However, even the difficulties of
the ‘new world order’, most recently in Iraq following the US-led
invasion in 2003, have not dampened enthusiasm for a particular type of
economic model (neo-liberalism) and a particular type of political model
(liberal democracy) backed up by powerful global forms of governance
such as the WTO and the disciplining power of international capital.
Developing countries feel this very intensely. They are under much more
scrutiny than ever before and are under much greater pressure to conform
politically and economically than they were during the Cold War when
the two superpowers knew that if they pushed a country too hard they ran
the risk of driving it into the arms of the other side.40 There are
interesting questions about whether the current unipolar world is likely to
persist in the long term with the rise of China, or even a significant
Islamic state, but for the time-being the pressures on developing countries
are likely to remain intense.

The invasiveness of this kind of global power in the post-Cold War era
draws our attention to a major distinction between the current era and the
period when many of Viet Nam’s regional neighbours experienced rapid
economic take-off, namely that the earlier generation of ‘late developers’
operated in an environment characterised by greater freedom of
movement both economically and politically. This is an important point
and we need to bear it in mind when we start to consider what lessons
other Asian countries hold for Viet Nam in respect of governance. One
interpretation of this distinction is that change is also occurring much
faster than previously, including in the political realm so that policy
positions which may have been sustainable a generation ago may not be
now. However, there are no hard and fast rules here, which means that
what is possible has to be worked out on a case-by-case basis.

A second point to make is that the world is not becoming – nor likely to
become – the same, notwithstanding some of the more outlandish

40
Clapham 2002.

24
predictions associated with globalisation. We are not all converging
around some kind of ‘global culture’ based on universal values whether
they are liberal democracy or anything else. However, as we have
emphasised above, liberal democratic values are being pushed harder than
ever before, in the media, through international organisations, and in
relations between states. This has implications for what citizens think
and hence expect of states.

Thirdly, while the emergence of new forms of transnational and non-state

power alongside the state means that ideas about national sovereignty
may need to be re-thought, arguments about a ‘loss of sovereignty’ in an
era of globalisation can be overdone. Sovereignty has rarely been an
absolute anywhere in the world while power shifts are best viewed not in
zero-sum terms. This latter point is clearly recognised in the
transformationalist thesis with its emphasis on the state emerging stronger
despite the growth of transnational and non-state power.

The Party in Viet Nam is correct when it notes that many of the world’s
problems can no longer be solved by individual states working along.
However, this simply underlines the importance of countries working
together either bilaterally or through regional and multilateral
organisations. In the case of developing countries, this includes teaming
up with fellow developing states to try and reform international
institutions and the rules they operate by where they are skewed against
them. However, when all is said and done, the state remains a crucial
actor and ideas like ‘governance without government’ need to be taken
with a big pinch of salt.

There are a number of other global trends which are worth noting as we
consider the context in which Viet Nam’s approach to governance needs
to be framed. The extent of their relevance will vary from state to state
depending on the impact of globalisation on a particular state and the
nature of the state itself. Compared with many developing countries,
Vietnam is a relatively strong state and thus is better placed than some
states to act autonomously. However, this is not to suggest that the state
in Viet Nam is – or will remain – unaffected by the kind of changes we
are discussing.

1. Some commentators have written in a novel way about the impact of

globalisation on the changing class structure of society, arguing that
globalisation has brought about a ‘cleavage’ between the beneficiaries of
globalisation, or those people who are integrated into the world economy,
and those who are disadvantaged or excluded from it. Leaving to one

25
side the question as to whether this ‘cleavage’ is something new or
whether we have simply become more aware of it, Robert Cox has
divided the world’s population into three categories:

• Highly skilled people integrated into the management process

(‘taking decisions about what is produced, where and by whom’
and, one could add, staffing government and international
organisations);

• Supporting workers, whose position is often precarious on account

of low wages and flexible working arrangements. Supporting
workers are also commonly segmented by ethnicity, gender,
religion and geography which makes collective organisation to
stand up to management difficult; and

• People excluded from international production altogether (the

unemployed and the marginalised in shanty towns and
mountainous areas). 41

What is noteworthy about these categories is that they transcend any

simple developed-developing world dichotomy. For example, foreign
visitors to New York or London are often shocked by the number of
homeless people begging on the streets and living lives which one more
readily associates with developing countries.42 Moreover, these
categories also have little in common with traditional categories used by
the state in Viet Nam such as peasantry, working class, business people,
intellectuals and so on.

Building on this analysis, Cox makes the point that citizens may be better
understood in relation to consumption – or, as is often the case, their
inability to consume adequately – rather than in relation to production.
He suggests that while the old production-related categories have not
been superseded entirely they may need to be rethought. We will come
back to this later in the report but it is certainly possible to recognise the
truth of what Cox is saying in relation to Viet Nam. This raises important
questions about the way in which the state categorises its citizens and
hence conceptualises and responds to their needs. This, in turn, may have
profound implications for the way in which governance programmes are
designed.

41
Cox 1999.
42
Taylor 2003.

26
2. Writing on globalisation, some analysts have commented on how in a
world characterised by diverse poles of power, there are now “multiple
layers of authority and [importantly] loyalty”.43 That is, citizens no
longer just look to the state as a source of authority or as place where they
owe loyalty. This does not preclude ‘love of country’ or patriotism but it
does point us towards the multiple influences on people’s lives whether
they are the international media, their employer (private, foreign or both),
transnational organisations, new social movements, time spent abroad,
foreign friends or spouses, commercial advertising, or whatever.

Of course, one could argue that the state has never been the sole influence
in people’s lives anywhere, and this is probably right. However, it is a
question of degree and the argument that generally speaking there are
now more sources of authority in people’s lives and hence more calls on
their loyalty strikes us as valid and worth taking seriously when thinking
about governance, including in Viet Nam.

3. Some commentators have suggested that globalisation has given rise

to a spirit of ‘disconnectedness’ between people and politicians along
with a decline in trust within society and less willingness on the part of
citizens to engage in collective action.44 Such comments sound very
much as if they reflect trends in Western democracies, such the decline in
voter turnout, youth disaffection, or consumer-driven individualism.
However, trends like this are not just limited to the more developed West.
Cynicism and mistrust towards politicians, and youth crime, is present in
many countries across the world, including developing ones. Moreover,
an unhealthy individualism and the breaking down of traditional ties
which have bound people together is a well-known feature of countries
undergoing rapid economic and social change.45

There are a variety of ways in which states and societies might respond to
a decline in trust or a reduced willingness on the part of citizens to
engage in collective action but – the first step – an awareness that such
trends exist, and that they may be part of a global phenomenon, is
important when considering different approaches to governance.

4. It is often said about developmental states in Asia that state legitimacy

rests heavily on economic development.46 This presents few problems

43
Cox 1999.
44
Ibid.
45
Polanyi 2001.
46
Leftwitch 1995.

27
when the economy is doing well but can lead to difficulties when the
economy falls on hard times. Moreover, in an era of globalisation, when
national economies are frequently affected by forces beyond their control,
it appears dangerous to rely too heavily on economic development as a
source of legitimacy not least because citizens may blame the state for
something it was powerless to influence. Some analysts have suggested
that it is through the development of civil society that state legitimacy can
be maintained. This is an important part of the answer. However, we will
talk more about civil society in the next chapter along with other
approaches to boosting legitimacy drawing on the experience of other
Asian states.

28
5. Civil society, rule of law and the market: Lessons from Asia

In the previous chapter, we considered some of the governance challenges

stemming from changes in the global environment over the last thirty
years. We argued that despite these changes, the state remains crucial in
any discussion of governance but suggested that there are important
questions to ask about how the state should relate to its citizens and new
forms of national and transnational power in an era of globalisation. In
this chapter, we turn our attention to Pacific-Asia, looking at how
different countries in the region responded to social and political change
on the back of rapid economic development. We are not going to look in
any detail at how the state in these countries relates to transnational
power because, important though it is, it is beyond the scope of the study.
However, drawing on the experience of Asia, we are going to explore
different ways of thinking about and relating to civil society. We will also
examine issues to do with rule of law.

The starting point for this chapter is to distance ourselves from the so-
called transition literature, or transitology, which views all political
transitions as proceeding through three stages (opening, breakthrough and
consolidation) and necessarily ending with liberal-democracy. From the
perspective of transitology, all states engaged in a political transition are
on a transition to liberal-democracy because, according to this way of
thinking, this is the only ‘mature’ political state there is. Transitologists
also elevate elections above all else as the sine qua non of legitimacy in
politics.

However, this is a distortion of reality and good sense. Liberal

democracy is clearly not the only political tradition on which states can
draw. Rather, liberal democracy is one of a number of traditions ‘out
there’ although as we emphasised in the previous chapter it is
undoubtedly an influential one. Moreover, although elections have an
important role to play in politics, history shows that they are not the only
test of legitimacy or, it is important to add, the sole source of order in
political life. As a result, we would argue that elections, which can be
deployed in a wide variety of different ways, should be viewed as one of
a number of options within a ‘tool-box’ of possible approaches to
governance on which countries can draw. As Ethan Leib and Baogang
He have expressed it, writing on China:

“…a comprehensive democratisation process will include, in addition

to elections, full-scale participation, deliberation, and a panoply of
fundamental human rights. Indeed, democratisation processes need

29
 not commence with elections and can legitimately form and evolve
with institutions of more participatory forms of democratic
governance”.47

Looking at East and Southeast Asia, we think it is appropriate to classify

political regimes in the region into four types:

• Reforming Communist or one-party states (China, Laos, Myanmar,

Vietnam);

• Dominant party democracies (Singapore, Malaysia, Cambodia48);

• Populist regimes (Thailand, Indonesia, the Philippines); and

• Stable multiparty democracies (South Korea, Taiwan).

Thus, we can see immediately that Asia is itself home to a diverse range
of political systems. Moreover, these are systems in their own right and
cannot simply be regarded as ‘way stations’ on the road to liberal-
democracy.49 Even in respect of South Korea and Taiwan, where the
influence of liberal democracy is most in evidence, we – with others –
would emphasise the way in which liberal democracy has been ‘grafted
on’ to a much older non-liberal political tradition creating a political
system which is neither simply liberal-democratic as in the West or
traditional.50

What this four-way classification of Asia’s political regimes also

illustrates is that there is no clear connection between political culture and
type of regime in Asia. Sinic culture, for example, has been associated
with a wide variety of regime types, especially if we consider the issue
historically (imperial, republican, communist along with the different
political systems in Hong Kong, Singapore and Taiwan).51

Continuing with the theme of culture, it is worth emphasising that there is

no single or fixed Asian political culture just as there is no single or fixed
European political culture. Nevertheless, culture and political tradition

47
Leib and He 2006: 1-2.
48
Cambodia is aspiring to the status of a dominant party democracy but
has yet to achieve the stability of either Singapore or Malaysia.
49
Carothers 2002
50
Bell 1995: 2.
51
Whitehead 2000: 234.

30
need to be taken seriously and it is possible at a certain level of
abstraction to highlight some ‘common themes’ distinct to Asian and
Western political traditions. Baogang He, for example, argues that Asian
states tend to be more outcome-oriented in respect of politics while
Western states are more process-oriented.52 Outcome-oriented regimes
would tend to elevate the maintenance of order above all else and be less
concerned with how order was maintained. Process-oriented regimes
would probably say that some degree of messiness in politics was the
price to be paid as to ensure that the process by which decisions are is
exemplary. While there is some truth in this, such a distinction should
not be applied slavishly since it is not the case that Asian states are
unconcerned with process or Western states are unconcerned with
outcomes. However, the key point is that differing political traditions are
not determinative in terms of how political life can evolve (i.e. they don’t
rule anything in or out). Moreover, most countries in Asia are today
drawing on a variety of different political traditions, including liberal-
democracy. As we saw in the previous chapter, a tendency to borrow
from a range of different political traditions is likely to become more
pronounced in an era of globalisation.

While it is important when thinking about political change to move away

from the idea that all states are on the road to liberal democracy, or that
elections alone should be viewed as the standard bearer of political
legitimacy, there is one truth, or lesson, which comes across very clearly
based on the Asian experience. This is that rapid economic development
of the kind Viet Nam is experiencing – and of the kind that most countries
in Pacific-Asia experienced from the 1950s and 1960s onwards – leads to
the emergence of a denser civil society as economic development
precipitates social change.53 One can see this in all countries of the
region and one can see it in Vietnam.54

The key questions in relation to this observation are three-fold. Firstly

what form has the emergence of a denser civil society in Pacific-Asia
taken? Secondly, what are the possible ranges in terms of civil society’s
relations with the state? Thirdly, how have different countries in Asia
sought to manage this process?

52
He 2003.
53
Potter 1993 and Rueschemeyer et al 1992.
54
Kerkvliet et al 2003.

31
We will attempt to address all these questions in the course of this chapter
but we will first make some generalisations regarding the contours and
dynamics by which a denser civil society emerged in Asia.

First, to reiterate a point we began to make in the previous chapter,

namely that rapid economic development in Asia gave rise to a more
variegated class system accompanied by the formation of a multiplicity of
social groups as people start to lead more diverse lives and come under a
wider range of non-state influences. Writing on the flowering of civil
society which occurred in South Korea following the political
liberalisation initiated by President Roh Tae Woo in 1987, Su-Hoon Lee
characterises the social organisations in terms of ‘green’ movements,
encompassing anti-pollution, environmental protection, anti-nuclear and
peace movements, economic justice movements, feminist movements and
consumer protection movements amongst others.55 This list is indicative
not exhaustive and others have highlighted the proliferation of social
organisations in a wide range of other areas. Writing on civil society in
China in the early 1990s, for instance, Gordon White groups
organisations into ten categories based on their area of operations, namely
political, economic, science and technology, culture and education,
sports, health, social welfare, religious, friendly and public affairs.56

Focusing on the Korean experience, Lee notes the way in which civil
society organisations were non-violent and reformist: that is they wanted
to moderate the rough edges of the market economy rather than do away
with it altogether. He also says that in raising their concerns they won
support from a broad cross-section of the public in a way which
transcended class differences.57

Second, rapid economic change poses a challenge for social cohesion and
traditional social relations as rural-based populations leave the land to
work in cities and, more generally, as the economy is subjected to the
vagaries of the market mechanism. All countries in Asia have
experienced this to a greater or lesser extent. In Thailand, for example,
politics has been plagued by an urban-rural divide for many years such
that some commentators have said that rural people vote Thailand’s
politicians in only for the urbanites to ‘kick them out’. There is some

55
Lee 1993: 359-360.
56
White 1993.
57
Lee 1993.

32
truth in this, including in respect of the most recent casualty of Thai
politics, the former prime minister, Thaksin Shinawatra.58

Third, experience from Asia suggests that rapid economic development

tends to be associated with the emergence of a more distinctive business
elite and as industrialisation proceeds, a more vibrant labour movement.
In time, it is not uncommon for the business elite to emerge as a more
distinctive force in its own right so while business might have had its
origins within the state sector, it can become less amenable over time to
state direction. This process can be seen very clearly in South Korea,
where the chaebol have been a major force in politics and not always a
force for good. While the rise of a strong entrepreneurial class is crucial
for development, it can pose challenges in terms of governance.

In respect of South Korea, some commentators have emphasised the need

for a countervailing power in respect of the business class, possibly in the
form of organised labour.59 Certainly, politicians in Korea have proven
vulnerable to special interest pleading in respect of business and the
corruption cases involving chaebol money and politicians have been
legion. In the late 1990s, the Korean president, Kim Dae-Jung, launched
a social pact which sought to incorporate both labour and business (the
Tripartite Agreement for Fair Burden Sharing). Tat Yan Kong describes it
as the culmination of a decade of largely unsuccessful by the Korean
government to find a consensus involving labour and business which was
favourable to economic growth:

“This experiment with a social pact distinguished Korea from the rest
of industrialising Asia. It signalled the state’s recognition that the
costs of economic restructuring had to be borne fairly and not by
labour alone. The social pact was also an interesting test of the
compatibility of labour inclusion with neo-liberal economic
policies”.60

Fourthly, the Asian experience shows that social change on the back of
economic development tends to lead to greater differentiation within the
state itself, which needs careful handling if it is not to be destabilising.
The emergence of a more distinctive business elite is part of this process
as different business interests tend to become aligned with different
politicians. It has also been a common feature of political transitions –

58
McCargo and Pathmanand 2005 and McCargo 2006.
59
Kong 2000.
60
Ibid: 385.

33
not just in Asia but across the world – that ruling elites often split at
critical or challenging junctures. In South Korea, for example, the
presidential candidate, Roh Tae Woo broke ranks with the then president,
Chun Doo Hwan in June 1987 when he accepted the opposition’s
demands for direct presidential elections in the face of massive social and
labour unrest. History now tends to look favourably on Roh Tae Woo’s
actions but at the time it was a move fraught with danger.61

Within the academic literature on political change it is widely debated as

to whether political change represents a response to rising popular
pressure or whether in fact it is a response to emerging elite cleavages
and an attempt to manage them better. David Potter, for example, makes
the point that Asian countries have tended to very successful at managing
pressures from ‘below’ in “a manner that does not fundamentally threaten
dominant class interests”. This suggests that in Asia political change has
tended to be more elite rather than popularly driven.62 Adopting a similar
line, Daniel Bell and Kanishka Jayasuryia have written:

“The impetus for political reform arises not from the autonomous
interests of independent interests by social classes but from conflict
within the state; political reform is about the management of intra-
elite conflict rather than about the fundamental restructuring of state-
society relationships”.63

Thus, from this perspective, elites are encouraged to pursue political

reform as far as they can not as a way of diffusing emerging popular
pressure – although this may be part of the reason – but more as a pre-
emptive move to better manage emerging differences within elite circles.
Looking at the Asian experience, we would certainly argue that such an
interpretation rings true. As a number of studies have shown, even so-
called ‘people’s power’ is often cleverly manipulated by elites from
behind the scenes.64

In terms of how Asian countries have responded when faced with the
emergence of a denser civil society, the first thing to say is that there are
clearly some better and worse ways to respond while there are some
approaches which are best avoided altogether.

61
Han 1988.
62
Potter 1993 and 1997.
63
Bell 1995: 14.
64
Hedman and Sidel 2000.

34
Looking across the region, one can clearly see a number of occasions
where elites resisted change for too long, creating a ‘pressure cooker’
effect. Suharto’s Indonesia is a case in point.65 South Korea also
arguably waited too long to introduce political reforms and a result
suffered from protracted, and frequently violent, labour unrest.66 It is
much better to act in plenty of time like in Taiwan, where the ruling
Kuomintang initiated a dialogue with the opposition in 1986 before
matters got out of hand. This way the Kuomintang was much better
placed to manage the transition rather than having its hand forced by
events.67 The Taiwan case is particularly noteworthy since it is widely
viewed as a case of a political elite moving to adopt a multiparty system
less because they were pushed in the face of rising popular pressures and
more in an attempt to reverse Taiwan’s growing marginalisation in
international politics as China emerged from its closed door economic
policy to embrace reform.68 In effect, therefore, the Kuomintang in
Taiwan decided that it faced enough challenges as it was so that it could
do without the added burden of criticism about its political system.

In countries where there is no opposition to speak of, consideration has

been given to whether the state should itself initiate the formation of a
second ‘loyal’ political party as a way of helping the democratisation
process along and bolstering legitimacy. In Singapore, for example, Lee
Kwan Yew once considered splitting the People’s Action Party in two as a
means of forming a second party although in the end he decided to pursue
an alternative path.69

As we can see by looking at Asia’s populist regimes (Thailand, Indonesia

and the Philippines), elections are no panacea in terms of delivering
order, stability or legitimacy. Instead, in many of these countries, money
politics is king and populist politics is often highly irresponsible,
resulting in a cycle of dashed expectations and broken promises.70
Aspiring dominant democracies like Cambodia, where elections have
been held regularly since 1993, often do little better in terms of delivering
stability although the ruling Cambodian People’s Party in Cambodia does
not suffer from the ills of populism.71

65
Sidel 1998.
66
Han 1987.
67
Cooper 1987.
68
Whitehead 2000: 234.
69
Barr 2003: 92.
70
Hedman 2001b; McCargo and Pathmanand 2005; Ziv 2001.
71
Hughes 2002b.

35
Writing on Latin America in a chapter entitled ‘The Alternatives to
Liberal Democracy’, Laurence Whitehead maps out a variety of rather
political regimes which have characterised the region’s recent political
past. Most are best avoided. These include what he refers to as
“impotent, bankrupt and socially explosive democracies”, unstable
populist regimes, and neo-liberal “depoliticised” or “internationally
dependent” democracies’. However, Whitehead argues that between neo-
liberal democracy, which suffers from high levels of inequality, and
irresponsible populism, there is an attractive middle way which he
associates with social democracy emphasising equality of outcome as a
goal and the state getting the best deal for its citizens in a competitive
global economy.72 This, it would appear, fits very well with many of the
sentiments expressed by the Communist Party in Viet Nam, as articulated
its Political Reports to National Congresses.

In terms of the governance options available to developing countries,

some of the key differences relate to the how to understand the role of
civil society, political parties, opposition and the rule of law although
most countries, as we have emphasised, embody a mixture of different
approaches.

A liberal-democratic approach to civil society understood in terms of an

autonomous sphere outside of the state and separate from the market
would emphasise its role as a counterbalance to state power. However,
others less influenced by liberal-democracy have emphasised the
importance of civil society in a wide variety of different ways, such as
diffusing discontent73; better managing political differences74; sharing
responsibility75; problem solving76; saving time, money and personnel77;
keeping order and building legitimacy.78

While some authors have noted the way in which civil society can be
distinctly uncivil if not properly managed79, it is also clear that an
important role of civil society is to help build social cohesion and smooth

72
Whitehead 1993.
73
Potter 1993: 364.
74
Bell and Jayasuriya 1995.
75
Potter 1993: 364.
76
Bell and Jayasuriya 1995.
77
He 2003.
78
Ibid.
79
Hedman 2001.

36
off the rough edges of the market – as we saw in Korea from the late
1980s. However, there is also an important role for the state too in terms
of developing a productive state-society relationship.

Where some commentators emphasise the countervailing role of civil

society in relation to the state, others see the development of civil society
more in terms of a state-led strategy designed to maintain or increase
commitment to national goals.80 Writing on China, Chamberlain talks in
terms of civil society enjoying a measure of autonomy while at the same
time being part of a “disciplined partnership with the state”.81

As with civil society, similar differences underpin how people understand

the rule of law. The liberal-democratic tradition tends to emphasise the
independence of the judiciary from the executive, performing a checks
and balances role. Others, notably Singapore, have seen the judiciary as
performing the function of bolstering the executive.82 This is a significant
difference. While there are no objective reasons why states must follow
the liberal-democratic tradition in respect of law, there are questions to be
asked as to whether citizens who are now more influenced by liberal-
democratic ideas than they were in the past will tolerate the use of law as
a means to bolster executive power for ever.

Singapore arguably offers one of the best examples in Asia of what has
been termed “non-confrontational civil society”.83 In Singapore, the
People’s Action Party has not prevented the organisation of civil society
groups per se but it has taken steps to channel their activities encouraging
them to work with the state to improve and implement public policy. It
has done this in a variety of ways, including imposing legal limits on
independent social and political activities. Here the Societies Act, which
Singapore inherited from the British and revised in 1968, is very
important. The Societies Act serves to reduce the likelihood of the
emergence of an antagonistic civil society by restricting political
engagement to registered parties and associations and by severing
registered parties from any social base that could be mobilised in support
of an anti-government agenda.84

80
Bell and Jayasuriya 1995.
81
Chamberlain 1998:
82
Jayasuriya 2000.
83
Barr 2003.
84
Ibid.

37
The government has also engaged in extensive cooptation of citizens and
social groups. This includes appointing citizens to serve on
parliamentary or government advisory groups. The government in
Singapore has also pioneered the creation of ‘nominated members of
parliament’ to serve as an alternative to political opposition.85

Citizens in Singapore are also quite dependent on the state for social and
economic resources and this is believed to have contributed to the PAP’s
longevity as well. The Central Provident Fund is a key instrument in this
respect given its multiple role as a way of paying for a mortgage to buy a
house, purchasing life insurance, borrowing for one’s children’s
education, paying for hospital expenses and saving for retirement. Other
mechanisms through which the government has maintained its position
include the extensive reach of Government Linked Companies (GLCs)
and close ties between the political executive and the civil service.

While the Singapore model has been very successful in terms of

delivering stability and prosperity for the city-state, the PAP has recently
become aware of its limitations as Singapore society continues to change.
Thus, in the post-Lee Kwan Yew period, the PAP has sought to encourage
greater freedom of artistic expression and generally be more tolerant of
civic organisations even if they are duplicating the work of a government
organisation. Others changes that the PAP has introduced include the
issuing of new media and TV licenses, partial privatisation of some of the
GLCs, and the establishment of a ‘speakers corner’, where people can
freely express their opinions to an assembled crowd without needing to
apply for a government permit. In addition, the Singapore state has
moved away from using blatantly repressive and political laws, such as
the Internal Security Act, to confront its opponents to greater reliance on
administrative law through defamation, libel and contempt of court
actions.

Singapore’s approach to exercising political power, which particularly

recently has sought to balance openness with control, is worthy of
comment in its own right. Much of the time political control in
Singapore is indirect rather than direct. Singapore, for example, does not
seek to control what its citizens view on the internet, concluding rightly
that direct information control will never be very effective and that
anyway there are more important things the state should do to maintain
order and try to build citizen loyalty.86

85
Ibid.
86
Rodan 2003.

38
Commenting on Singapore’s approach to exercising political power,
David Barr writes:

“The [Singapore] elite’s control of social and political agendas needs

to be final, but there is no expectation that it will be absolute or
complete. Goh Chok Tong, like Lee before him, appreciates the
virtues of exercising power with careful discretion, so that within the
parameters of control, the advantages of a relatively free discourse
can be maximised and the dangers of creating a backlash against the
arbitrary exercise of power can be minimised”.87

If Singapore offers one approach to supporting the growth of civil society

in a non-liberal setting, China offers some equally important lessons in
respect of citizen deliberation. It also offers some pointers in terms of the
relationship between deliberation and civil society.

Writing on China, Baogang He says that China represents a good

example of a country seeking to combine tradition with contemporary
democratic practice. He argues that this is the way forward, invoking
Aristole when he calls for a ‘mixed approach’ to governance. 88 The
advantage of a mixed approach, He argues, is that it is a good way of
balancing a range of different interests, notably between rich and poor.
He also stressed the importance of legitimacy being founded on range of
different elements, including revolutionary legacy, economic
performance, ideology and democratic procedures ‘blended together to
form a successful outcome’.89

It in respect of a blended or mixed approach to governance that citizen

deliberation becomes important. While liberal model of democracy
focuses upon procedures and institutions such as voting, elections,
political representation, political parties, separation of powers, and the
balances of powers, deliberative democratic theorists stress the
importance – and right – of citizens to participate in deliberation.
Deliberation takes place through public hearings, consensus conferences,
citizen evaluations, mediation meetings, local elections preceded by
extensive discussion, and Deliberative Polling. It aims to ensure equal
opportunities for citizen participation in collective decision-making as

87
Barr 2003: 91.
88
He 2003.
89
Ibid.

39
another means of building up legitimacy. Deliberation does not aim to
make decisions (generally) but rather to clarify preferences.90

Deliberation particularly aims to minimise the impact of unequal power

and wealth in decision-making processes. Of course, this is very difficult
to do in practice and there is an ever-present danger that deliberative
meetings will be formalistic and fail to transcend existing hierarchies.
Research on China has highlighted the way in which the ‘new rich’ who
have emerged on the back of reform particularly go out of their way to
defend their interests in deliberative forums. However, there are ways in
which such dangers can be minimised, notably through careful planning
and regular monitoring of the way in which deliberation actually occurs.91

With reference to China, there are some important debates taking place
regarding the relationship between deliberation and civil society and
between deliberation and electoral democracy, particularly whether
deliberation should be seen as an alternative or not. A liberal approach
tends to assimilate ideas about deliberation within a broader notion of
civil society, which is why people in the West are generally not very
familiar with deliberation.

In keeping with a mixed approach to governance, Baogang He, on the

other hand, argues that one should not overdo the distinction between
deliberation and civil society or between deliberation and electoral
democracy. Both traditions, He argues, emphasise the development of
civil society and the importance of public reason in collective decision-
making. For He, developing deliberative institutions is best seen as one
component of a broader democratisation strategy or a step on the road to
a more full-scale democracy. He also argues that deliberation generally
requires some electoral democracy to work properly even if only at the
local level.92

There is also discussion among deliberative theorists, particularly in

relation to China, about whether deliberation should take place at the
national level or just at the local level, which is more common. The
general view appears be to start locally as a way of institutionalising ‘best
practice’ lower down in the political hierarchy. This is because the
difficulties of ensuring effective deliberation at the local level are
magnified the higher up the political hierarchy one goes. In time, good

90
Leib and He 2006.
91
Ibid.
92
He 2006.

40
deliberation at the local level is likely to have an impact on behaviour at
the national level.93

93
Leib and He 2006.

41
6. Implications for Vietnam

In this chapter, we consider the implications of the study’s findings for

Viet Nam as it considers its governance reform options to 2020. Broadly
speaking, our analysis is divided into three parts. After briefly reviewing
the study’s principal message so far, we offer some general principles
regarding how Viet Nam might usefully conceptualise governance in the
twenty first century. We then highlight what we regard as ‘priority areas’
in respect of governance. These are areas which we believe will need
more attention in the years ahead in light of the kind of changes Viet Nam
is currently undergoing and we anticipate in the future.

It is worth emphasising that in a study of this nature, which is relatively

limited in scope, it is not possible to come up with fully worked out
‘policy positions’ in respect of the areas we have highlighted as being
important. Naturally, all our suggestions would need to be explored in
considerably greater detail if they were to be adopted. However, there
will be some scope to hint at what such a policy platform might look, or
at least how one might get there, in Chapters 7 and 8.

In chapter four, we characterised the world in an era of globalisation as

comprising ‘multiple authorities’ and ‘competing loyalties’. Multiple
authorities refers to the different ‘poles of power’ which now exist in the
world (transnational, national, state and non-state) while ‘competing
loyalties’ seeks to capture the idea that citizens are influenced by a range
of authorities other than just the state. Such assertions notwithstanding,
we emphasised that the state continues to be important to any discussion
of governance. However, we suggested that the growth of transnational
and non-state power has important implications for how states operate,
particularly how they relate to their citizens. In our analysis, we also
drew attention to the influence of neo-liberal and liberal democratic ideas
in the world today, arguing that the pressure on developing countries to
conform to such ways of thinking and acting is intense.

In chapter five, we noted that based on the experience of Asia, rapid

economic development is usually accompanied by the emergence of a
denser civil society, a more distinctive business class, a more vocal labour
movement, and greater differentiation within the state itself. Rapid
economic development, we said, also carries an enhanced risk of social
in-cohesion as traditional structures come under strain and as society is
more exposed to the vagaries of the market – including the global market
– which produces winners and losers. Finally, we looked at different
ways of thinking about civil society and the rule of law.

42
So, what are the implications for Viet Nam?

We think it is self-evident in respect of the change process we have

highlighted that there are numerous parallels with Viet Nam. Over the
last twenty years, Viet Nam has indeed undergone a process of rapid
economic and social change. It has seen the beginnings of the emergence
of a denser civil society along with a more distinctive business class and a
more vocal labour movement. Viet Nam has been fortunate in that it has
not witnessed major splits within the Party or Government itself during
the doi moi period. However, looking at the experience of Asia, it is
important not to be complacent: elites have a habit of splitting at times of
rapid economic and social change.

Looking at social cohesion more generally, Viet Nam has received

widespread praise for achieving rapid economic growth without the
emergence of the levels of inequality seen in some parts of the world.
However, the risk that the gap between the rich and poor will widen is an
ever-present one and there is some evidence that poverty levels in Viet
Nam are in fact higher than is officially estimated.94 Moreover, Viet Nam
has by no means avoided some of the downsides of the market economy
whether it is commercialisation of public services, the emergence of an
urban poor, or wealth-induced social cleavages.

Land disputes have also become more common, highlighting the way in
which the logic of capital often conflicts with a wider notion of the social
good. Conflicts like this are inevitable at a time of rapid industrialisation
and urbanisation. However, the issue of land management in respect of
development needs very careful handling, especially in cases where those
associated with capital are linked to the state given the threat this poses to
state legitimacy. It is at times of conflict that it is crucial that the state is
not so intertwined with business that it cannot exercise its leadership role
in terms of mediating between competing interests. As development
proceeds, there is a danger that land disputes will become more not less
common in Viet Nam.

Before we consider how Viet Nam might respond to these challenges, it is

useful briefly to remind ourselves of existing structures and institutions of
governance. This involves taking account of longstanding practices as
well as newer initiatives which have emerged during the reform era.

94
Pincus and Sender 2007.

43
To begin by stating the obvious, Viet Nam is a one-party state led by the
Communist Party of Viet Nam. Democratic centralism governs
behaviour in the Party while relations between the Party and the
government are guided by the well-known diktat ‘the Party leads and the
government manages’. During the reform era, the National Assembly has
seen its role enhanced alongside a more general move to strengthen the
role of the government in the political system and develop a state ruled by
law. In addition, there has been a trend towards selecting a larger number
of public office holders through direct popular vote in competitive
elections. Both National Assembly delegates and People’s Council
representatives are now chosen in this way. In the absence of opposition
parties, the Viet Nam Fatherland Front and the mass organisations serve
the function that political parties would normally serve in a multiparty
system (i.e. a transmission belt between the state and civil society).
There has been some rejuvenation of the mass organisations in the reform
era, notably with the creation of new organisations to better reflect the
changing social structure of society (e.g. the Viet Nam Chamber of
Commerce and Industry). At the grassroots, we have seen efforts to
strengthen grassroots democracy based to some extent on the idea of
citizen deliberation. The Party has also sought to strengthen democracy
within its own ranks.

While the trajectory of change Viet Nam has experienced since 1986 in
respect of governance is to be broadly welcomed, there are some areas
which in light of the kind of changes Viet Nam is likely to experience
over the next 10-20 years will require more attention in the future.

So, what practically might Viet Nam consider doing in the area of
governance in order to build and develop the reforms it has undertaken to
date?

The first point to make is that we believe Baogang He’s idea of a ‘mixed
approach’ to governance whereby tradition and modern democratic
practice are combined in order to build a firm and broad basis for state
legitimacy has much to recommend it for Viet Nam. A mixed approach to
governance has the advantage that it moves Viet Nam away from
legitimacy being overly dependent on economic performance while
simultaneously reaching out to a new generation who are likely to be
more concerned about ‘having their say’ and more influenced by liberal
democratic practices than the older generation. At the same time, a
mixed approach to governance avoids becoming fixated on elections as
the sole source of legitimacy. In this respect, a crucial component of a
mixed approach to governance is the development of citizen deliberation,

44
similar to that which is being pursued in China. We think there a lot more
that can be done in respect of citizen deliberation in Viet Nam.

As part of a mixed approach to governance, we have identified the

following six areas as likely to benefit from special attention in respect of
Viet Nam’s governance programme to 2020.

1. Actively promote the development of civil society to serve as a

‘disciplined partner’ with the state in the pursuit of national
development goals.

Building a strong and dynamic civil society in Viet Nam will need to be a
key component of any governance agenda in Viet Nam over the next 10-
15 years. A strong civil society is likely to be crucial to maintaining
legitimacy in the years ahead. It is also a way for the state to share
responsibility with its citizens for Viet Nam’s development. In terms of
how to develop civil society, there are plenty of examples from around
the region of where civil society has been encouraged as part of a
partnership with the state in common pursuit of national goals (China,
Singapore, South Korea). In this way, a more confrontational approach to
building civil society, which is sometimes associated with the West, can
be avoided.

At the same time, too restrictive a regulation of civil society can be

counterproductive as the state comes to be seen as stifling of creativity
and independence of thought, which can lead to discontent and the danger
of a political backlash. It is concerns like these which lie behind the
recent revisions to the Singapore political model. Creativity and
independence of thought are also highly valued in today’s knowledge
economy, particularly as a country moves higher up the technology
ladder, so it is inadvisable to discourage such qualities for this reason too.

As we saw in respect of post-Lee Kwan Yew Singapore, the challenge for

any state is to navigate a path which allows relatively free and open
public space to flourish but where the state remains the ultimate arbiter of
what is permitted. What this means in practice – as the state in Singapore
is discovering – is that governments need to choose their battles and not
try and control everything. By way of an example, Viet Nam might one
day decide that the current household registration system (ho khau) is no
longer appropriate given the changes which have occurred in Vietnamese
society over the last decade and a half and particularly given the need for
greater labour mobility. On the other hand, it might decide to replace the
ho khau – in time – with an identity card system. This would be entirely

45
consistent with a modern approach to governance which emphasised
balancing openness with control, and would likely receive widespread
citizen support. In addition, a gradual change in terms of how the state
perceives its role and relates to its citizens will also ultimately involve it
becoming more at ease with criticism.

In Viet Nam, the draft Law on Associations is a step in the right direction
in terms of laying the legal foundations for developing civil society.
However, it is important that both the law and the practice strikes a
balance between a gradual, step by step approach to developing civil
society – which is advisable – and not being so restrictive that the
development of civil society stalls before it has really started. At the
same time, any agenda designed to develop civil society needs to devote
time to educating public officials at all levels about the function and
benefits of civil society. This is very important. Simply pushing the
development of civil society without this educational component carries
the risk of creating just the kind of social tensions we are seeking to
avoid.

2. Manage the emergence of a more distinctive and powerful

business class.

During the doi moi era, we have witnessed not only the growth of the
private business sector but also the emergence of a large number of
successful companies from within the state sector, including those
affiliated to the general corporations. We have also seen the formation of
chambers of commerce, business groups and various professional or
sectoral associations. Moreover, if one talks to domestic business people,
it is increasingly possible to identify a ‘business view’ – or more likely a
range of views – which is not always the same as the government’s view.
This is the case whether one is speaking to state or private companies. 95
At a time of rapid economic development, this is normal and this trend is
likely to intensify in the years ahead in the same way as it has in Korea
and elsewhere in Asia.96

Business is already emerging as a more powerful force on Viet Nam’s

political stage and the process needs to be carefully managed. To do this
successfully, the following principles need to be born in mind. First,
whatever is done to manage the governance aspects of the emergence of a

95
Author’s own research on firms in Hai Phong, Lao Cai, Tay Ninh and
Can Tho in 2004.
96
MacIntyre 1994.

46
more powerful business class, it must not undermine business confidence
or deter entrepreneurialism.

Second, as business finds its voice, it is important that its position in the
political system is appropriately institutionalised. This can take the form
of increasing the number of business people in the National Assembly
and government. Business people can also be invited to serve on
government task forces, working groups and specialist committees.

Thirdly, as with South Korea, there is a need for Viet Nam to develop
appropriate checks and balances so that money does not distort the
political process. One option is to strengthen the role of organised labour
to carry out this function (see, for example, Kim Dae-Jung’s social pact in
South Korea). Designing effective deliberation in respect of public
policymaking is another.

Ensuring healthy business-government relations is a critical area. It goes

to the heart of the conflict of interest debates surrounding public officials
which have been visible in the media and other public fora in Viet Nam in
recent years. It is crucial that policies are put in place which over time
will institutionalise a certain distance between the state and business.
This is necessary so that the state does become too closely aligned with
business interests with all the risks that this entails in terms of corruption,
threats to legitimacy, the distortion of public policy, and the inability of
the state to act in the public good, including disciplining business when it
breaks the law. Maintaining a healthy distance between the state and
business is also important as way of building social cohesion because of
the bad feeling which is engendered in society when officials are seen to
be too close to business. The difficulties that the government is facing in
respect of adjudicating in land disputes is indicative that it has not got the
state-business relationship right yet.

3. Manage the emergence of a more vocal labour movement,

including the possibility of increased activity outside the official Viet
Nam General Confederation of Labour.

In terms of organised labour, relations between labour and capital

continue to be managed through the offices of the Vietnam General
Confederation of Labour, which is Viet Nam’s only officially permitted
labour organisation. Since the onset of the market economy, labour
relations have become more complex and the state has often had to steer a
difficult path between ensuring that labour is protected and not scaring
business away – both of which are important. However, this is a difficult

47
tightrope for the government to walk and sometimes labour has taken
matters into its own hands, calling strikes outside of the formal trade
union structure.97 In this respect, we would suggest that Viet Nam’s
labour movement is showing signs of having more in common with South
Korea than, say, Singapore where the subdued labour movement is the
result of conditions unique to the city state. It is important for its
legitimacy that the state in Viet Nam preserves its reputation as being a
champion of labour rights whilst remaining pro-business. It will find it
easier to do this if – as we suggested above – it takes step to create some
distance between state and business.

There is a danger in the short and medium term that labour relations in
Viet Nam could deteriorate as workers feel the official Viet Nam General
Confederation of Labour is unable to represent their interests. There are a
number of possible responses to this: one is to consider more radical
reform of the VGCL, including possibly allowing the formation of a
second labour union. Whatever the Party decides, there is a need to
simplify the regulations governing what workers need to do to call a
strike because the situation which currently prevails whereby it is nearly
impossible to meet all the requirements of what constitutes an officially
recognised strike is causing tension. A sharp deterioration in labour
relations would not only be politically destabilising but also would have
very negative consequences for business confidence.

4. Extend and institutionalise the process of citizen deliberation in

respect of public policy.

Expanding the role of citizen deliberation in public policy making is a

critical component of a mixed approach to governance. As we have
emphasised, deliberation does not aim to make decisions but rather to
clarify preferences. Viet Nam has some experience of deliberation
through its initiatives in respect of grassroots democracy but there is
much more that could be done in this area. This includes taking steps to
improving the quality of deliberation at the lower levels, particularly to
explore ways to minimise the distorting effects of existing power
structures and money in how decisions are made.

For deliberation to be effective, it is crucial that all sectors of society are

represented. Getting this right is challenging but it is one of the
recognised strengths of deliberation that if planned and implemented
properly, it is well suited to tackling the distorting effects of wealth and

97
See Nghia (2005); Tran (2005); and Kim (2005).

48
entrenched political power. China offers some examples both of
successful and less successful deliberation.98 It is probably best to
experiment with deliberation at the lower levels first but there is no
reason why in time it cannot be deployed on a piece meal basis at the
provincial and national (e.g. through public consultation processes).
Effective deliberation is sure way to strengthen state legitimacy. Given
this, there may be merit in the authorities being more explicit both
domestically and in its international relations that deliberation is an
important part of how Viet Nam does governance.

The mass organisations have a potentially important role to play in

respect of deliberation, serving as they do as a transmission belt between
the state and society. However, there is a pressing need to strengthen the
mass organisations, notably by asking whether the existing mass
organisations adequately reflect the changing social structure of society.
For example, there may be scope to considerably revitalise the mass
organisations by moving away from the current format of groups
representing farmers, women, intellectuals etc. However, what the
alternative categories might be would need careful thought.
Alternatively, it may be possible in time to use one or more of the mass
organisations as the basis for a second ‘loyal’ political party, if this was
felt to be the way forward.

Making sure that the mass organisations remain representative in a

rapidly changing social context and genuinely inspire a new generation of
Vietnamese citizens to participate in the political life of their country is
crucial if they are not to wither or result in disillusionment.

5. Step up efforts to build social cohesion.

In this report, we have frequently highlighted the danger of social in-

cohesion in Viet Nam at a time of rapid economic and social change.
Preventing in-cohesion, or at least minimising the risk that it will occur,
requires action on a wide range of fronts. Building social cohesion is a
cross-cutting theme which needs to be at the heart of all governance
work. From the state’s perspective, pushing ahead with its efforts to
develop a comprehensive social security system is one component.
However, civil society also has an important role to play in terms of
maintaining social cohesion whether it is cultivating values of good
citizenship, establishing charitable organisations to protect the weaker
members of society, or campaigning to protect the environment.

98
Leib and He 2006.

49
Again, as we emphasised earlier, this kind of activity is best viewed as
part of a state-civil society partnership where the activities of such groups
complement rather than detract from the work of the state. It does not
matter if the state and civil society are working in the same areas.
Indeed, from the perspective of social cohesion, this is a good thing.

Social cohesion will also be served by incorporating as many people as

possible in the drive to develop the country. Particularly important here
is increasingly the role – and profile – of non-party members. This could
be achieved by appointing appropriately qualified non-party members to
senior government positions, including ministerial positions, or inviting
non-party members, including overseas Vietnamese, to serve on
government task forces or advisory committees. Building social cohesion
through incorporating as many people as possible in the drive to build a
strong, wealthy and civilised country would also be served through
increasing non-party representation in the National Assembly. This could
be done by introducing quotas for non-party delegates, which could be
phased in over an appropriate period of time.

Building social cohesion also involves addressing tensions within the

state. In Viet Nam, many commentators have highlighted the way in
which different state institutions do not always work well together in
respect of carrying out their core functions. Moreover, there is some
evidence to suggest that ‘institutional particularism’ has got worse during
the reform era, possibly as marketisation has permeated the state. Turf
wars between government agencies are a fact of political life all over the
world. However, if institutional differences reflects the emergence of
structural tensions within the state and society itself, then it is important
that such are difference are properly managed so they do not spiral out of
control.

Another component of building social cohesion is to ensure that those

with money – the so-called ‘new rich’ – behave responsibly and do not
take advantage of their new-found wealth to oppress others. This is about
encouraging respect for others and social responsibility, including
through philanthropy.

6. Consider ways to increase competition and widen the franchise for

the election of Party and Government positions.

During the doi moi period, we have seen moves to extend the use of
competitive, direct elections in Viet Nam’s political life, notably in the

50
election of National Assembly delegates and People’s Councils
representatives. Building on these successes and as part of a mixed
approach to governance which seeks to combine tradition with modern
democratic practice, it is important to consider ways in which the use of
elections might be further extended as a means of organising the
country’s political life. Under the leadership of the Party, we believe
there are potentially no limits to the extent to which public officeholders
at all levels are chosen by popular universal suffrage where voters get to
choose from two or more candidates as is the case in National Assembly
and People’s Council elections.

Looking ahead to the National Party Congress in 2011, for example, there
may be merit in considering whether Party members might be given a
choice of candidates for the post of Party General Secretary or whether
those entitled to vote might be widened to include all Party members or,
in time, all citizens. South Korea and Taiwan provide good examples of
how the franchise for choosing key politicians and parliamentarians was
widened by way of a gradual, phased approach. In Viet Nam, such an
approach would certainly help strengthen legitimacy and social cohesion.

51
7. Rethinking governance programmes

In this chapter, we aim to relate the findings of this report in terms of new
ways of thinking about governance to how governance is currently
understood and practiced by the government and international donor
community in Viet Nam. We will ask whether in light of our findings
certain things ought to be done differently.

In some ways, it is difficult for anyone to criticise existing governance

work in Viet Nam because the chances are that whatever one highlights as
somehow deficient, someone, somewhere will be doing it. This comes
across very clearly based on a brief review of existing donor activities in
the governance field. Without a doubt, the standard list of programme
areas is comprehensive with all the ‘usual suspects’ of public
administration reform, legal and judicial reform, public financial
management, parliamentary development, and anti-corruption work
receiving significant attention from a wide range of agencies.99
Interestingly, this list is not very different from governance programmes
in other countries where the international donor community is working
although inevitably there is some variety depending on whether a country
has a multiparty system or not.100

If one looks at the Party and Government’s governance programme as

articulated in the Political Report to the Tenth Congress or the Five-Year
Socio-Economic Development Plan (2006-2010) it is also hard to fault it
in terms of its aspiration or extent of coverage since it too covers a wide
range of areas.101 Nevertheless, the question remains: how can we be
certain that the Government and donors in Viet Nam are working in the
right areas or prioritising those areas which are most important? This
question is especially pressing given that we operate in a climate of finite
resources and not unlimited time.

99
Australian Agency for International Development (2003); Swedish
Ministry of Foreign Affairs 2002; UK Department for International
Development 2004 and 2006; Vietnam Development Report 2005; World
Bank 2006. See also United Nations Development Programme
http://www.undp.org.vn/undpLive/Content/What-We-Do/Focus-
Areas/Democratic-Governance [last accessed December 21, 2006]
100
Carothers 2002.
101
Communist Party of Vietnam 2006 and Ministry of Planning and
Investment 2005.

52
In this study, we have sought to highlight what we believe will be some
of the key determinants – and hence trajectories – of change over the next
10-15 years in Viet Nam. In a sense, therefore, what we have done is to
come to a view on what we think the dynamics of Viet Nam’s social,
economic and political life are likely to be between now and 2020. We
have also articulated a way of thinking about governance, which we
believe is appropriate given the kind of changes Viet Nam is undergoing
and which we anticipate it will undergo in the future. Having done this,
we are now in a much stronger position than we were previously to go
about answering the question as to what Viet Nam’s governance
programme of the future should look like based – it is worth emphasising
– on Viet Nam’s actual conditions not some ‘one size fits all’ blueprint,
which in terms of most donor activity is usually overly influenced by
liberal democracy.102

So, what are the key points to make?

First, in terms of a new way of thinking about governance, we

emphasised the importance of the state moving more concertedly to share
responsibility for Viet Nam’s development with its citizens through the
development of a ‘disciplined partnership’ with civil society. This
inevitably requires the state ‘letting go’ in some areas, delegating
responsibility to society in areas where previously the state has been
dominant, and reforming the way in which public institutions operate,
whilst continuing to remain the ultimate arbiter of authority (see Chapter
6 for details).

Secondly, in light of the kind of changes Viet Nam can expect to

experience in the future, we highlighted a series of priority areas, which
we believe should be at the centre of any future governance programme
in Viet Nam. Aside from creating the conditions for the growth of a
vibrant and dynamic civil society, these include:

• Developing a healthy state-business relationship, notably

anticipating the kind of governance challenges which can arise as
business develops and becomes more powerful;

• Building a healthy relationship between labour and capital;

102
Carothers 2002.

53
 • Working to strengthen social cohesion across a wide range of fronts
as possible (social security provision, corporate social
responsibility, philanthropy, tackling corruption etc);

• Strengthening the role of citizen deliberation in public policy

making; and

• Building modern democratic practice, notably by selecting as many

officeholders as possible through direct, competitive elections.

Ultimately, it is for the Party and the Government – not for the writers of
this report – to decide whether they think existing governance
programmes, including those with the international donor community, are
appropriately tailored to the emerging needs of the country as we look
ahead to 2020. If they believe they are, then nothing needs to change. If,
however, based on the analysis put forward here, it is felt that we have
successfully identified some gaps, then some adjustments should be
made. Our suspicion is that important changes in terms of the focus and
priorities of existing governance work will need to be made even while
retaining that which remains relevant and appropriately targeted.

In the past, much emphasis has been placed in donor strategy papers on
governance being a ‘cross-cutting’ issue. However, there was always a
danger that governance was so cross-cutting that it fell between the
cracks. Part of what we have argued in this report is that ‘good
governance’ needs to have at its core a commitment to tackle the
distorting effects of wealth and entrenched political power on decision-
making, which we anticipate being one of the key challenges for Viet
Nam as its economy develops. In practice, this means a shift towards
understanding governance broadly. Here, we are not thinking about
governance as being ‘more than just government’ although this is
obviously important. Rather, when doing governance, it is necessary to
branch out from beyond governance’s traditional remit to more overtly
economic areas in order to identify the distorting effects of the way in
which – for example – the sale of state assets occurs or the tax system is
structured. If one did this, then one could truly say that governance in
Viet Nam was cross-cutting. Such an approach would be in tune with the
Party’s stated social democratic credentials.

To conclude this chapter – and indeed the substantive part of the report –
with a final, distinctive message, we would argue that everything we have
said ultimately relates to one thing, namely building social cohesion at a
time of rapid economic development when social cohesion is being tested

54
like never before. If Viet Nam places social cohesion at the centre of all
governance work and moves to implement such a programme
successfully then the country’s future will indeed be bright.

55
8. Suggestions for Further Research

Any research agenda arising from this report is likely to emerge on the
basis of in-depth discussions between the study’s stakeholders which
have yet to take place. However, below we offer a preliminary
assessment of some of the issues which may merit further investigation
based on our research so far.

One of the consequences of conducting this study is that we now have a

much clearer picture of the countries most likely to yield insights for Viet
Nam in respect of governance. This is important since it will enable any
future comparative research to focus on a smaller sub-set of countries
from the outset. Our short-list would be China, South Korea, Singapore
and Taiwan. However, based on some of the reading conducted for this
study, we also think there may be merit in carrying out some comparative
work on Latin America as a possible source of insights for Viet Nam.

Not surprisingly, we believe there is scope to go into more depth in

respect of nearly all the issues raised in this report. In order to provide
some strategic direction in respect of governance in Viet Nam, we have
had to cover a lot of ground in this report and hence could not go into as
much details as we would have liked. If any of the recommendations
made in the report in terms of our six priority areas for future governance
work are to be acted upon, it will clearly be necessary to examine the
issues in more depth.

We would suggest that any future research should retain a comparative

angle (i.e. How do other countries do it?) at least initially before moving
to consider the implications for Viet Nam and policy design. Thus with
reference to China, South Korea, Singapore and Taiwan, there is scope to
look in more depth at civil society development, state-business relations,
labour relations, building social cohesion, citizen deliberation and
elections. In large part, a research built up on these lines would entail
thinking more deeply about what a ‘mixed approach’ to governance
would look like in Viet Nam, what the difficulties are likely to be, and
how one might design governance projects to address them.

We believe there is scope to look more carefully at the nature and

consequences of social change in Viet Nam for governance, including
drawing on the experience of other countries. A sense that there was
more work to do in this area was one of the original triggers for this
study. However, although it provided the backdrop to the study, it
ultimately became subsumed in a wider research agenda as set out by the

56
study’s stakeholders. If we were to re-visit the issue of social change, the
best way to do so would be through fieldwork, including interviews and
surveys.

Finally, as a first step to compiling any future research agenda, it may be

useful to translate some of the key books and articles cited in the report’s
bibliography into Vietnamese. In time, there also may be merit in
sending suitably qualified Vietnamese researchers to centres of excellence
in Asia, Europe and North America to work on specific issues as part of
international teams engaging in applied policy research. If such activities
could be tailored to fit in with the Government’s own work on its Ten
Year Socio-Economic Development Strategy (2011-2020), this would
clearly be beneficial.

57
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Appendix

Appendix 1

A Comparative Study of Governance Reform Options for Vietnam To

2020 Drawing on the Lessons from Asia

Since the launch of doi moi at the Sixth Party Congress in 1986, Vietnam
has come a very long way. Twenty years of reform have delivered
sustained, rapid economic growth and tangible improvements to living
standards. Of course, there is more work to be done but there is a
growing sense that Vietnam is at last on the road towards fundamental
economic change. Accession to the World Trade Organisation, expected
in the very near future, is just the latest in a series of milestones on this
developmental path.

Moreover, unlike so many other countries in the world, Vietnam has

achieved this economic transition whilst maintaining political stability.
This is no small achievement for which Vietnam ought to be
congratulated. Put simply, without political stability, economic
development will not take place. But old political structures and
approaches will not necessarily continue to deliver stability as society and
the economy change. Rapid economic change, it is well recognised,
produces numerous challenges in the area of society and politics.

Inevitably, this gives rise to many questions, some of which are not easy
to answer. How is the relationship between the state and society
changing against the backdrop of integration and rapid economic growth?
Are the country’s institutions changing fast enough to meet the challenges
of the new era? What kinds of institutional changes are most likely to
promote stability, democracy and good governance? What will Vietnam
look like socially and politically in twenty years time?

At the Tenth Party Congress in April 2006 – and indeed before and since
– the Communist Party of Vietnam has made clear its determination rise
to these challenges in the area of society and politics to create a state
ruled by law and characterised by increased transparency and
participation. Of course, not all of this is new: Vietnam has been
grappling with many of these issues for many years and tangible progress
has been made in terms of legal development, grassroots democracy and
civil service reform to name just a few. Nevertheless, new periods
require new solutions. Not underestimating the extent of the challenges
which lie ahead, one retired party leader recently said that in the same

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way that Vietnam launched doi moi in the economic sphere twenty years
ago, there was now a need to launch a similar process in terms of
democratising society, democratising the Party, and in the work of
Vietnam’s officials and in Party-building more generally.

In response to this, the Vietnam Academy of Social Sciences (VASS), the

United Nations Development Programme (UNDP), and the UK
Department for International Development (DfID) have commissioned a
study which will consider these issues in more detail.

In particular, the study will focus on what governance in Vietnam will

look like in the future to promote more openness and democracy, and the
development of (i) civil society; (ii) a state ruled by law; and (iii)
governance institutions and practices consistent with the market-based
reforms introduced since the start of the doi moi process twenty years
ago. The report will produce policy recommendations of relevance to
government and development partners and will feed into the deliberations
on the government’s Ten Year Socio-Economic Development Strategy
(2011-2020).

The study will be conducted in the form of a comparative analysis of the

experiences of other countries in Asia which have also undergone rapid
economic and social change. Countries and economic areas likely to be
scrutinised include South Korea, China, Taiwan, Singapore, Malaysia,
Thailand, Indonesia and the Philippines. The study will examine both
what has worked well in these countries and what has worked less well as
these countries have sought to address governance challenges in the face
of rapid economic development, with the aim of providing lessons for
Vietnam.

In adopting this approach, a number of caveats need to be made. Firstly,

there is no single ‘model’ out there which Vietnam should slavishly
follow. All countries are different and Vietnam must find its own way.
Nevertheless, some of the challenges Vietnam is facing are not unique to
Vietnam: they have been experienced in other countries in Asia at other
times, particularly countries which are further ahead on the
developmental path. Therefore, it makes sense that Vietnam should study
these experiences carefully, learn from them, and then decide what is
appropriate for Vietnam given its distinctive conditions and priorities.

Secondly, Vietnam’s economic and political transition is taking place

under the leadership of the Communist Party of Vietnam – the leader of
Vietnam’s state and society – which led the country to victory in the anti-

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colonial wars against the French and the Americans. This is very
important and in carrying out the research for this study it is important
not to lose sight of this.

Thirdly, and related to the previous point, this study is not about
advocating a transition to multiparty politics. Some countries in Asia
have gone down this path but Vietnam has emphasised its determination
to promote more openness and democracy under the leadership of the
Communist Party of Vietnam. Within this framework there is much that
Vietnam can do to realise these goals. The question is what and how to
ensure that any transition to more openness and democracy occurs in an
orderly and peaceful manner. These are the questions which the study
will seek to answer by surveying the range of experience in other
countries in Asia.

There is no doubt that the study is ambitious in its scope and aims to
cover a lot of ground. Therefore, as a study that provides strategic
direction, it may be necessary for it to flag areas which merit from further
investigation in the future. However, this is to be welcomed.

Next Steps

The research and writing process will proceed as follows. A researcher

and governance expert at the University of Bristol will conduct a
comparative study of Asian experience in the field of governance
reforms, focusing on the lessons for Vietnam. Specifically, the expert
will explore what governance in Vietnam will look like in the future to
promote more openness and democracy, and the development of civil
society, a state ruled by law, and framed in the context of the market-
based reforms introduced since the start of the doi moi process twenty
years ago. A first draft of this study will be ready in December 2006.

At this point, the study will be sent out for peer review to Vietnamese
experts chosen by VASS. Once the peer-review comments are received, a
workshop will be held in Hanoi to discuss the report. After the workshop,
the report will be revised. When VASS, DfiD and VASS are satisfied, the
report will be published.

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