VIETNAM: Consecutive agrarian reforms and success in family farming

Past agrarian systems

The Viet tribes, ancestors of the contemporary Vietnamese, cultivated terraces, and then the delta of the North Vietnam Red River, and developed their civilisation on the basis of rice cultivation. In the XIth century, they founded the first Vietnamese hydraulic state, after several centuries of Chinese domination. In the XVIth century, the Northern deltas were not enough to feed 5-6 million inhabitants.There were waves of immigration towards the South, heading to colonise the Centre, and then South Vietnam, which were inhabited by Chams and Khmers at that time. A new State was founded in the South, with a military regime controlling the colonisation process. With the contribution of both immigrants from China and European merchants, the South was more open to the external market than the North, which remained self-sufficient and interior-oriented.

Vietnamese society, having rice production as a primary activity, consisted of two principal elements: the central State and the village community, which kept certain autonomy. Social inequalities were compensated by solidarity among the communities. Land tenure rights were a mixed system of state, communal and private property. Surprisingly, the tenure system for the commons, whose aim was to secure both growth and social security, persisted longer in Vietnam than in China or Japan. The growing privatisation of land ownership resulted in the introduction of new categories in agrarian society: landowners, small-scale farmers and landless farmers. In the North and Centre, where the common land tenure system had been better conserved ¹ and where there was considerable demographic pressure, the farms were smaller, and differentiation was lesser: there were no landed gentry. Whereas in the South, where the land was more abundant and where there was not much common land, differentiation was greater, with the existence of large-scale farms and many landless peasants.

Before 1930, agricultural productivity was very low (1.3 ton/ha). Food production was sufficient for internal needs as the annual growth rate of the population was inferior to 1%. The farmers, particularly those without land, were living in miserable conditions.

In North Vietnam, different cadastres provide an understanding of the evolution of land ownership. At the beginning of the 19th century, the land owners of Ha dong and Thai binh owned respectively 1.9 and 7.3 ha on average; in 1931, the population had multiplied by 4, thus dropping the average land ownership to between 0.7 and 1.3 ha, respectively. It’s estimated that around half of the farmers of North Vietnam were without land. In a century, the differentiation in land access became more pronounced ².

In South Vietnam, due to certain details of its prior agrarian history and the violent military-run colonisation processes that it underwent, the agrarian structure was very different from that of the North. In South Vietnam, villages and communes were founded on the basis of private land ³ ownership ⁴ comprised of state-owned land and large military farms, whereas in the North, they were founded on common land ownership. The land was more unequally divided in the South than in the North.

Tab.1 : Land ownership in South and North Vietnam in 1930.

	Surface area	% landowners	% surface area
NorthVietnam C.Gini 0.43	< 1.8 ha	91,5 5	40
	from 1.8 to 18 ha	8,4	27
	> 18 ha	0,1	16
	Common land		17
	Total	100	100
South Viet nam C.Gini 0.87	< 5 ha	71.7	15
	from 5 to 10 ha	14.7	10
	from 10 to 50 ha	11.1	32.5
	> 50 ha	2.5	45
	Common Land		3
	Total	100	100

Source: Y. Henry, Economie agricole de l’Indochine, Hanoi, 1932.

 

Land ownership records from the French colonial period show that the differentiation between peasants remains visibly at the same level as in the XIXth century. In 1929-30, V. Henry remarked that extensive land ownership predominated in the west of Cochinchina. However, family ownership and common land still existed. It has been calculated that 77% of rural families were landless. The predominant tenure method was indirect (tenant farming), with a few local exceptions.

Starting in 1900, demographic pressure increased. After 1930, the annual demographic growth rate exceeded 2%. With agricultural expansion on new land being limited, the food production problem became more and more acute. During this colonial period, no significant social or technical improvement had taken place, with the exception of a few irrigation projects aimed at increasing the surface area of rice cultivation. The difficulties became more pronounced during the Great Depression of the thirties.

This century’s agrarian reforms

In 1945, after the August revolution, the Vietnamese government decided to reduce by 25% unearned income coming from land holdings. To mobilise the peasants in the struggle for independence in 1948 during the resistance war of 1946-1954, more than 250 000 ha of land belonging to the French and their Vietnamese allies was confiscated and distributed to peasants.

In 1953, when the war entered into a decisive period, the campaign for an agrarian reform began. All land belonging to landowners was confiscated and equally distributed to peasants.

Tab. 2 : Land distribution before and after the agrarian reform of 1953.

	Before AR		After AR
	% Homes	% Land	% Homes	% Land
Land-owners	1.1	18.0	2.3	1.1
Rich peasants	1.8	4.7	1.6	1.8
Middle-class peasants	41.7	39.0	36.5	11.7
Poor peasants	40.0	25.4	43.0	40.0
Landless	12.0	6.3	13.0	12.0
Others	2.6	1.0	3.60	2.6
Monasteries	0.1	1.3		0.1
Communal land	0.7	4.3		0.7

Source: Statistics General Office, Economy and Culture of Vietnam, 1930-1980, Hanoi: 1980.

 

But this period of return to a family-scale economy was very brief. Starting in the early sixties, agriculture began to be collectivised. In South Vietnam, a separate state was established after 1954. Between 1955-56, an agrarian reform was instigated in South Vietnam under the regime of Ngo Dinh Diem: land unearned income was reduced by 15-25%, and maximum land ownership was fixed at 100ha. However, this reform did not visibly diminish the farm sector’s deep inequalities: the Gini coefficient moved from 0.84 in 1955 to 0.80 in 1966 (see Tab.3).

Nevertheless, in South Vietnam during the war with the USA, the Nguyen Van Thieu government lanced a new program in 1970 entitled, « land for cultivators », and passed legislation limiting ownership to 15 ha in the South and 5 ha in the Centre for landowners who farmed the land themselves.

Tab.3 : Land distribution in South Vietnam during the war.

Category	% landowners		% Surface area
year	1955	1966	1955	1966
0	46.7	42,0	0	0
0.1 - 4.9 ha	38.6	45.3	16.4	27.4
5.0 - 19.9	7.8	10.5	13.0	33.3
20.0 - 49.9	5.6	1,6	24.0	15.6
50.0 - 99.9	0.7	0.5	12.5	12.1
More than 100.0	0.5	0.2	34.1	11.6

Source: Callison, 1983. ⁶

 

Expropriated land (with compensation) was distributed to peasants (up to 3 ha in the South and 1 ha in the Centre). The land of those who participated in the revolution was confiscated, but the landless didn’t receive land.

At the same time, in regions controlled by the revolutionary government, another agrarian reform was instigated. Land belonging to big land-owners was confiscated and distributed to small farmers. After the liberation of South Vietnam, an agrarian reform with a re-allocation of land between peasants was effectuated. People with a lot of land voluntarily shared it with others. Collectivisation began in 1978, but it was followed by a de-collectivisation in 1981 with Decree No. 100, which applied to the whole country.

If much is said today about the negative side of collective agriculture, it must be mentioned that this system was accepted favourably by peasants in certain regions of Vietnam. Specifically, it was appreciated where the demographic pressure was strong and where there was a high percentage of common land, as in the low delta of the Red River and in the South of Central Vietnam, and also where there was not yet private property, as in the mountains of the Northwest.

However, in the late seventies, the system of centralised planning and collectivisation posed problems for both the Vietnamese economy and agriculture. A process of economic reform was therefore initiated to eliminate constraints on development. The economic reform in Vietnam in the eighties and early nineties was based on the double transition from centralised planning to a market economy system, and from collective agriculture to an economy composed of small family farms.

A progressive and effective process of de-collectivisation

During the period of collective ventures (agricultural co-operatives), only the collectivisation of rice production (main production of the Vietnamese agricultural economy) was successful. Attempts to collectivise food production other than rice farming and livestock breeding failed. Peasants were then allowed to increase their economic activities outside of co-operatives and were given access to a supplementary surface area for family farm use, in addition to a family plot covering 5% of the total surface area and family orchards.

Under these conditions, small farming activities have been making up a larger and larger portion of a peasant’s total income since the seventies and have exceeded that of co-operatives. For this reason, some co-operatives used a type of contract, called a clandestine contract, to rent out a certain surface area of their rice plantations to small farmers. This system improved farmers’ motivations, and had positive effects on production. Directive #100 (1981) legalised this system, which was invented by the peasants themselves, and gave them the right to decide on their work and its results. However, the small farmers weren’t altogether satisfied with this new system. To simplify and optimise resource management, a « complete contract » was then established. By leasing land to farmers, this contract allowed them to invest while paying a low rent. The resolution #10 of 1998 gave farmers the right to decide how to use their capital. With the abolishment of both the system of State product delivery and the State subsidy system, the economy based on small family farming was finally restored. After this resolution, some land was still controlled by the co-operatives. This land was distributed to peasant households according to labour capacities for a 5 year period. Although the households were not obliged to pay rent to the co-operatives, their land holdings were taxed by the government.

Although the 1987 land law forbade the selling of land, an illegal land market had been established. The 1993 Land Law decided that land belonging to the state would be distributed to peasants for cultivation in correspondence with the number of people in each household, for a period of 20 years for annual crops and 50 years for perennial crops. Furthermore, land use rights may be exchanged, transferred, rented, inherited and pawned. The maximum limit of « ownership » is 3 ha. Forested land was also distributed for reforestation or management.

Tab.4. : Estimation of land ownership in the Mekong Delta after 1975.

	Landowners	Surface area
Rich peasants	20	10-12
Middle-class peasants	12-17	20-27
Poor peasants	50-60	50-60
Landless	20-30	0

Source: Agrarian reform committee, 1978

 

After these three consecutive institutional changes, all rights over production input were given back to peasant households and the collective system of agriculture was abolished.

Other transformations also took place in the industrial and service sectors. In 1979, the central committee of the Vietnamese Communist Party recognised the role of the market and the private sector as principal components of the economic system. The 1980 reforms of the planning system permitted both economic activities outside of the State’s plan for government companies and complementary activities for state employees and workers whose salary was not sufficient for their subsistence. The double price system (State price and free market price) as well as the planned subvention system were abolished in 1985 on account of bureaucratic corruption and scandal-provoking errors during the price, salary, and currency reforms.

The effects of the revival of an economy based on small family farming

Socialist agriculture had not succeeded in resolving the food production problem: at the end of the eighties, Vietnam had to import food every year. It was the peasants who led the way. Today, Vietnam has become one of the world’s biggest exporters of rice and several other food products. Cashew nuts, coffee and yams, which were less controlled by the State, underwent the most radical development. Vietnam has become the world’s second cashew nut exporter and the third coffee exporter (first of the Robusta variety).

The restoration of the small family farming economy had a great impact on agricultural production. Peasants, who in the past were hardly integrated in the market, progressively became commercial family producers. However, farm size (0.7 ha inland, 0.3 ha for the Red River delta) represents a constraint on agricultural development. The growth of the active rural population tends to reduce the size of the farms and leads to under-employment. In South Vietnam, the number of landless farmers augments, and in the North, the peasants who have abandoned agriculture do not yield their land to others. The reform process is not finished: new institutional arrangements are necessary. This implies a certain redefinition of the respective roles of the government, the market and the civil society (which is not officially acknowledged). In addition, new land policies that are adapted to the new context need to be created.

The revival of family farming, after diverse agrarian reforms which established a relatively egalitarian structuring of the farming sector, constitutes an undeniable success. Vietnam’s history illustrates that peasants, with the might of their knowledge accumulated through the centuries, are capable of very dynamic evolutions, but need adapted agrarian and land policies in order to express their full potential.

This article is part of Land Policies and Agrarian Reforms. Proposal Paper. 2007

Translation: Mary Rodeghier. 2007.

¹In 1930, 21% of land was communal in north Vietnam, 25% in the centre and 3% in the South Y. Henry, 1932.

²According to our calculations, the Gini coefficient moved from 0.4-0.5 to close to 0.6. The Gini coefficient is a cumulative index of inequality, which can vary from 0 (perfect equality) to 1 (perfect inequality). In countries with a high revenu inequality, this coefficient is between 0.50 and 0.70 whereas in countries with a relative equality this coefficient is between 0.20 and 0.35.

³Certain villages had, however, common land bought with communal funds.

⁴The Gini coeffiecient was from 0.6 to 0.8 for the Mekong delta and from 0.4 to 0.6 for the Red River delta. (Dao The Tuan, using the cadastres of 124 Cochinchine villages).

⁵With 62% with less than 0.36 ha.

⁶Callison C.S., Land to the tiller in the Mekong delta, University Press of America, New York London , 1983.