[Vnbiz] Rural Development Strategy

[Tran Dinh Hoanh]

Dear CACC,

Let''s start working on a rural  development strategy.  Rural development so
far appear to have no strategy at all.  Poverty alleviation has been
relatively successful; that is a major part of rural development.   But it
seems this is a nationwide phenomenon due to national economy success more
than a strategy on rural development.  The government has a policy of
supporting business investment in remote areas (vung xa vung sau), but this
policy seems not very successful so far.

One of the major phenomena in demographic makeup is that we have been seeing
and will continue to see for the next 50 years immigration waves of young
rural folks into major cities in search for schools and jobs.  This will
create many mega cities as well as putting tremendous urbanization pressure
on major cities, at the same time it will reduce the number of young workers
in the rural areas greatly.

The key to development an rural area, like every where else, is
"opportunity"--people have to have opportunities in order to want live and
work in an area.  Young students need education opportunity, adults need job
opportunity and business needs business opportunity.  How do we bring these
kinds of opportunity into a rural area?  In some area with special natural
endowment, such as a beautiful beach or a gold mine, businesses come first
for business opportunity.  Businesses naturally gather workers and their
families around them, from there spring up schools, hospitals, markets,
churches and temples and shops.

Unfortunately, most rural areas of the country do have beaches or gold mines
and businesses don't flock in their way.  Government investment incentives
like tax relief may not be good enough to induce business.  The problem is
that in poor rural areas we don't have infrastructure to support business
(electricity, road, telecommunications, Internet), no good employees
(because most good young workers have left for the cities), no good living
environment for workers and their families (markets, schools, churches,
temples, recreational  activities).  So how do we develop a poor district
without good business opportunity?
I.   The best approach is for the government to develop education
opportunity in such an area--i.e., giving the students high schools and
colleges.  And here is the logic:

     1.   The lowest cost for the national economy is to have local shools
for students. Without local schools, a number of students will leave for
schooling in the city; the schooling cost for these students (in the city)
is probably 3 or 4 times the schooling cost in the local area (if there is a
local school).  A big number of other students who can't afford schooling in
the city will simply stop schooling.  The lost of brain power in these
students and its adverse impact for the national economy can be tremendous.
To avoid these costs, building schools in the local area is the least costly
way.

     2.  The building of a school requires/encourages the building
infrastructures around the schools (road, electricity, running water,
telecommunications).

     3.  Schools tends to build clusters of residences and businesses around
them.

     4. Schools keep potential workers in the area.

     5.  All the above provide incentive for businesses to come in to invest
in the area, especially if there is tax incentive from the national and
local governments.

If the government build high schools and two-year colleges throughout the
countryside, the sites for these schools will evolve into small town
centers, which will reduce some urbanization pressure on major cities and
generate a number of small towns throughout the countryside.  Thus, I would
recommend building high schools and two-year colleges as the main "engine"
of a rural development strategy.

II.  In addition, the government should encourage the development of
agriculture related industries--food processing, dry food, dry fruit,
canning, etc.

     1.  There should tax incentive for new businesses in these industries.

     2.  Technical support through government's agriculture extension
services and international NGO.
     3.   Help these enterprises become more sophisticated by encouraging
them to establish their own business associations.

(Note:  This year Vai thieu in Hai Duong has such a big harvest that the
price comes down tremendously and all the farmers lose big.  This situation
would be alleviated greatly of there is some small canning facility in the
area.  Canning can be done with very small, almost home-style, facilities).
The government needs to have a specific policy and specific personnel to
support the development of feed processing industries.

III.  Making more loans available to farmers for equipments and input for
production (seed, fertilizer, animal feed and medicine, etc.)

IV.  Establish an agriculture insurance program, collecting small amount of
money from farmers in normal time, to help them in case if natural disaster
and animal epidemic.

V.  Making sure that no price-control programs will affect farmers' sale of
their products (Farmers should always be able to sell their products at
market price).

VI.  Encourage mirco-financing organizations to operate throughout the
countryside.

VII.  Help local leaders and local establishments connected to the Internet.

VIII.  I realize that in areas where there is a church or a temple operates,
people generally do better than other areas (more organized, less crimes,
making more money).  So I would recommend the government to encourage
main-stream religions to open more churches and temples throughout the
countryside.

IX.  Rural government leaders tend to act like little God.  If the
government en courage talented people (including non-Party candidates) to
run for local offices, that would help develop the rural areas.

All these 9 points, if we do them seriously, I think could noticeably change
the appearance of any rural area in 2 years.

Please feel free to chip in.  Have a great day!

Hoanh

-- 
Tran Dinh Hoanh, Esq., LLB, JD
Washington DC
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