SEATTLE — Over the past several decades, the poverty rate in Vietnam has dramatically declined, lifting millions of people above the international poverty line of $1.25 a day. Surveys conducted in 1992 and 1993 indicate that the poverty rate in Vietnam was approximately 60 percent, according to international standards. Ten years later, however, the poverty rate was measured at approximately three percent. (Based on a new $2.25-a-day poverty threshold established by the General Statistical Office and the World Bank, the Vietnamese poverty rate was 20.7 percent in 2010.)
This marks a dramatic decline in poverty and should act as an example for other developing countries. To effectively understand how Vietnam made such a reduction, we must first examine how the poverty rate is calculated.
Two main methodologies are used to measure the poverty rate in Vietnam, one used by the Ministry of Labor, Invalids and Social Affairs (MOLISA) and one used by the General Statistics Office and the World Bank (GSO-WB).
The method used by MOLISA is mainly used to calculate how many people qualify for government-sponsored anti-poverty programs, as well as to determine the poverty rate in the short term. Contrarily, GSO-WB’s approach is mainly used to examine the long-term poverty rate.
The most substantial difference between the different poverty measurement tools can be found in the methods of data collection. MOLISA measures poverty based on a national census, in which villages meet to discuss which of its members would qualify as poor. GSO-WB primarily uses survey data gathered from each household.
Examining the astonishing rate of poverty reduction evident in Vietnam, the most important question to ask is: How did the country achieve such a remarkable poverty reduction?
Most signs point to the remarkable effort made to increase education among the Vietnamese people. In recent days, education rates in the country have reached 90 percent in primary school and 70 percent in secondary school. Additionally, the Vietnamese government has invested more money into the creation of canals and irrigation sources, allowing farmers to produce more crops.
Despite the tremendous success Vietnam has seen, it is important to maintain vigilance in regards to the poverty rate in Vietnam. As the country has continued to grow, income inequality has risen. As the poverty rate in Vietnam declines, it becomes increasingly difficult to measure as differences in data become more minuscule, and it is important to consider that the threshold for poverty may continue to change. It is important to continue to bring all Vietnamese citizens along as the county develops.
– Garrett Keyes