Protección del motor

In many cases, corruption associated with land transactions did not occur in a way that necessarily restricted the pace of economic transition. On the contrary, there was a very rapid land transition to accommodate the dramatic speed of industrialisation and expansion of commercial agriculture in Vietnam. The type of land transition in rural areas, however, has been different from the land transition experienced in urban and semi urban areas. In rural areas, most of the land was still held by smallholder farmers across the period of liberalisation. The commitment to egalitarian land rights that was established under the socialist political settlement continued to be important under liberalisation. There were formal attempts to stop the emergence of large farms through legal restrictions on the amount of land any one family could hold. A household farming rice and other crops with short growing seasons was allowed no more than three hectares. For other kinds of crops, the limit was 10 hectares in lowland regions of the country and 30 hectares in upland regions (Kerkvleit 2006). Despite these restrictions,

large farms, particularly in the south (Akram-Lodhi 2005). Given that LURs were often sold informally in rural areas, as in urban areas, the pace of concentration may have been more rapid than was officially recognised.

Despite formal restrictions, some large farms started to emerge after Doi Moi, particularly in the South (Akram-Lodhi 2005). For example, while the 1993 land law set a maximum farm size of 5 hectares, by 1995 there were already 113,700 farms larger than this and 1,900 in excess of 10 hectares (Akram-Lodhi 2005). The process of granting land titles was faster in the south, particularly in the Mekong Delta (Hare 2008). In this area land was less fragmented and plot sizes were larger due to the more limited socialist land reform. The extent to which local state institutions in rural areas were complicit in the emergence of larger land holdings varied across the country.

Given the decentralised distribution of power within the VCP, the attitude of local officials to larger land owners and to ‘outside’ investors influenced this process. In some cases local officials hindered market based land transactions that threatened to push local farmers off their land. For example Ravallion and De Walle (2001) described a case where local officials resisted purchase of land by ‘outsiders’ and pressured the local commercial agricultural bank to refuse to accept LURs as collateral for loans. Probably the area where there was most contention was when local authorities were complicit in larger expropriations of land. As with the urban and semi-urban land transition discussed below, many of these land appropriations were for the purposes of infrastructural investment or for the creation of industrial land or state owned plantations.

Some of the largest land expropriations in rural areas were directed by the central state.

Probably the most notorious example was the establishment of coffee plantations in the Central Highlands. The phenomenal growth in coffee production was linked to land transfers directed by the central level of the VCP in the Central Highland Provinces where 85% of Vietnam’s coffee harvest originates (Greenfield 2004). The coffee farms have their origins in a massive state orchestrated resettlement program of ethnic Kinh to the borderland region to ensure political stability in the face of potential unrest from local ethnic groups. The state exercised its right to purchase land by compulsion to set up New Economic Zones in the late 1980s and early 1990s on land traditionally owned by

tribal groups and encouraged ethnic Kinh to move into the area and establish coffee farms.

The economic success of coffee production attracted a massive flow of migration into the area. This further hastened the transformation of land into coffee plantations. An estimated 80% of coffee trees in the Central Highlands were owned by small scale farmers with less than two acres while the remaining 20% were owned by the state-owned Vietnam Coffee Corporation (VINACAFE) (Greenfield 2004). Thus, while small holding farmers were the main producers, their access to land was a result of actions by the Central VCP institutions. The region faced unrest and riots by ethnic minority groups unhappy with the state led expropriation of their homelands (BBC 2001). In 1997 the worst episode of unrest since the end of the war occurred in the Central Highlands in north-eastern Thai Binh province, with protests involving thousands of people against land distribution (Johnson 2001). Small scale uprisings against land appropriations by local government in rural areas were relatively frequent across the reform period (Kerkvleit 2006). While these incidents of revolt against land expropriation may have slowed down the land transition in certain cases, for the most part the transition has occurred without generating significant political unrest. The consolidation of political power within the institutions of the VCP under the formative socialist political settlement probably helped the VCP to maintain a high degree of social order in spite of the rising tensions around land over the period of liberalisation.

The example of central state interventions in land to support coffee expansion supports the argument that the central state in Vietnam did have a degree of control over property rights transition that was also described in the previous chapter in terms of its control over redistribution of oil rents. However, similarly to the case of public finances, the control of the central state was subject to on-going challenges from lower levels of the state that had significant power. Thus, while the central state was initially successful in its intentions to encourage coffee expansion, it was unable to push through its policy of restricting the output of coffee in the face of collapsing global prices. In 2000, the global price of coffee had fallen dramatically due to rapid increases in supply. The Vietnamese state announced that it would stockpile coffee in order to push up global prices. Despite this formal policy, the state was unable to restrict the supply of Vietnamese coffee onto

(Greenfield; 2004). Further, agricultural policies to encourage diversification into higher value added coffee and coffee processing have been largely unsuccessful (World Bank;

2004). The failure of central state policies to encourage technology acquisition are further explored in Chapter six.