Being Well Connected Is Classy: Internet Geography in Vietnam

BEING WELL CONNECTED IS CLASSY: INTERNET GEOGRAPHY IN VIETNAM

BJORN SURBORG

A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF

MASTER OF ARTS

THE FACULTY OF GRADUATE STUDIES

(Geography)

THE UNIVERSITY OF BRITISH COLUMBIA

August 2006

Since the release of the internet from its institutional and military foundation for public and commercial use, it has been advertised as a ubiquitous piece of infrastructure that is truly global and will provide opportunities for all people anywhere in the world. There is, however, evidence to the contrary that suggests that the internet and related information and communication technologies (ICTs) create highly uneven geographies and segregated spaces of inclusion and exclusion. Moreover, the internet is often considered as a means for enhancing democracy and civil society through easier and faster infonnation flows. Telecommunication and internet development have also become a main focus of Vietnamese public policy throughout the 1990s and have become an important piece in the reform process doi moi, which was officially introduced in 1986. Contrary to the idea that the internet will automatically enhance democracy and pluralism, the Vietnamese Communist Party (VCP) has managed to implement measures of flexible control over the internet that allow powerful elements in the state bureaucracy to restrict internet use to maintain the party's monopoly on political power. At the same time relatively few people have access to the internet in Vietnam and it serves primarily a newly emerging urban bourgeoisie, while there are few restrictions on commercial use of the internet. In addition, the internet serves as a means to integrate Vietnam into the global economy and makes the resource hinterland more accessible to the global commodity trade. A review of policy documents, secondary literature and a systematic search of Vietnamese news sources has been conducted for this thesis. The material has been critically analysed in the context of Michel Foucault's theories on power and Jiirgen Habermas's theory of communicative action. The economic relations have been analysed in the context of dependency and world-systems theories.

ii Table of Contents

Abstract ii Table of Contents iii List of Tables : v List of Figures , vi List of Abbreviations vii Acknowledgements viii Chapter 1: Introduction : : 1 Structure 2 Methodology '. 4 Chapter 2: Literature Review 7 Internet Geography 7 Dependency and World Systems Theory 10 World City Research 13 Global Capitalism 16 Social Theory 18 An Analysis of Internet Development through Multiple Perspectives 22 Chapter 3: Towards Full Scale Liberalisation: An Overview of Vietnam 24 Pre-colonial Era and French Colonialism 24 Post World War II until Unification 25 Building a Socialist Vietnam 27 The Doi Moi Reforms 28 Social and political changes 30 Regional Disparities and Inequality 33 No Monolithic Statism 38 Chapter 4: On-line with the People in Line: Cautious First Steps and Flexible Control 40 Full Access '. 43 Consolidation of Legislation and Infrastructure 45 Internet Content 49 The Internet Panopticon 52 The Micro Spaces of Internet Diffusion and Control 53 Social Evils or Political Control? 56 State Sanctioned and Sponsored Information and Internet Uses 59 Power and Manipulation 62 Chapter 5: Uneven Geographies 66 An Urban Technology 66 The High Price of being On-line 70 Mass Medium or Service for Private Property 76 A Public - Private Alliance 78 The Path to Development and the Global Economy 80 Integrating into the Global Market Place 81 Vietnam as a Source of FDI 85 Integrated into the Global Economy through Uneven Geographies 86

iii Chapter 6: Conclusion 88 Flexible Control of the Political Arena 89 Uneven Integration 90 Uneven Geographies 91 Power: a Matter of Connectivity 92 Bibliography 94 Appendix 1 116

iv List of Tables

Table 3.1: Poverty Rates by Region in Percent 36

Table 4.1: International Bandwidth by IXP 49

Table 5.1: Internet Use in Vietnam 1997 -2006 ...67 Table 5.2: Internet Users per 100 Inhabitants by Selected Countries 2002 - 2004 .. 68 Table 5.3: Share of Ethnic Minority Population in Selected Provinces 76

V List of Figures

Figure 3.1: Population Density 34

Figure 3.2: Regions of Vietnam 35

Figure 4.1: Legal and Illegal Connections in the Vietnamese Internet Structure 47

Figure 5.1: Telephone Density by Province 69 Figure 5.2: Telephone Density and Urbanisation by Province in 2003 70 Figure 5.3: Per Capita Income by Province 72 Figure 5.4: Telephone Density and per Capita Retail Spending by Province 73

vi List of Abbreviations

ADSL = Asymmetrical Digital Subscriber Line ANU = Australian National University ARPANet = Advanced Research Projects Agency Network ATM = Automated Teller Machine BBC = British Broadcasting Corporation DGPT = Department General of Post and Telecommunications DSL = Digital Subscriber Line FDI = Foreign Direct Investment FPT = Financing and Promotion of Technology Corporation ICP = Internet Content Provider ICT = Information and Communication Technology IMF = International Monetary Fund IOIT = Institute of Information Technology ISP = Internet Service Provider IXP = Internet Exchange Provider Mbps = Megabytes per second MPT = Ministry of Post and Telecommunication/Telematics USAID = United States Agency for International Development USD = United States Dollars VARENet = Vietnam Academic Research and Educational Network VCP = Vietnamese Communist Party VDC = Vietnam Data Communication Company VND = Vietnam Dong VNPT = Vietnam Post and Telecommunication Corporation

vii Acknowledgements

I wish to gratefully acknowledge the exceptional advice received from my research advisor Jim Glassman, who provided direction, support and valuable constructive comments throughout the research and writing process. I would also like to thank Elvin Wyly and Tom Hutton for their support and advice throughout the process. I would like to thank all three of them as well as many others at the University of British Columbia's Department of Geography and elsewhere.

viii Chapter i: Introduction

Since the introduction of the doi moi (engl.: renovation) reforms in Vietnam there have been profound changes in the lives of the Vietnamese people, but also a considerable level of continuity in the socio-economic and cultural life of the country. There is some debate about how dramatic the decisions to officially introduce doi moi at the sixth Party Congress of the Vietnamese Communist Party (VCP) in 1986 were. While some observers consider the congress a landmark event at which the party introduced reforms that were the starting point for the transformation from a centrally planned economy to a market system, others view the event as an official endorsement of changes that have taken place before. Doi moi was certainly - at least in part - also a reaction to changes internationally. The advance of Mikhail Gorbachev to the post of party secretary general in the Soviet Union and the reforms introduced there spilled over into Vietnam, especially because the Vietnamese state could no longer rely to the same degree on assistance from the Soviet Union as it did before. The events of 1986 certainly changed the way the Vietnamese economy operated. The reformers embraced market reforms in many sectors and opened the country to Foreign Direct Investment (FDD. that was intended to fuel the market economy and lead to economic growth. At the same time a land reform changed the lives of millions of Vietnamese peasants shifting agricultural production from a largely cooperative system to one of family production units. While there were profound changes in the economic structure of the country, many of which took effect rapidly, political reforms were few and those that took place were often slow and more a reaction to changing economic situations rather than the result of political will for such reforms. The VCP maintains its claim for the monopoly on political power and exercises considerable influence and control over the institutions of the state and mass organisations. How much control the party has exactly, remains equally subject to debate as the question of the party's role in initiating reform. Nonetheless, in spite of many challenges, the party has held on to political power in Vietnam and there is little that would suggest that the situation will change soon. (But the end of the cold war was not realised by the academic community until after the fact either.)

1 The market reforms and the associated image of modernisation have been important for the party to portray a picture of progress regardless of growing inequalities and many sacrifices by individuals. One part of this Vietnamese modernisation project has been the internet and the use of Information and Communication Technologies (ICTs). There has been some considerable growth of the internet in Vietnam since the country officially connected to the international network in 1997, but in this thesis I argue that the technology is highly exclusive and a mechanism that is part of a larger transformation enabling the party to remain in power while advancing economic market reforms without substantial political change. Contrary to the idea that the internet will automatically enhance democracy and pluralism, because of greater information flows, the VCP has managed to implement measures of flexible control over the internet that allow powerful elements in the state bureaucracy to restrict internet uses, if they consider their hegemony under threat. At the same time internet access is still largely limited to a newly emerging urban bourgeoisie and thus information transmitted over the internet will reach the large majority of the population through the filtered channels of the state apparatus, conveyed by Communist Party cadres. At the same time the internet is no exception to general developments in Vietnam and it has been part of substantial economic reforms. Commercial use of the internet is virtually unrestricted in Vietnam and contributes to integrating the rural hinterland with primarily peripheral-type production into the global economy. While it is presented as an opportunity for all, the net is exclusive and benefits primarih/businesses and wealthy individuals.

Structure

This thesis is divided into four main chapters, beginning with a review of the literature on internet geography, world systems theory and world cities, uneven development and social theory with a particular focus on discourse analysis and communication theory in chapter 2. The internet has often been portrayed as a ubiquitous technology available anywhere on earth, but more recent analyses suggest highly uneven geographies with respect to internet bandwidth and availability. In addition, there are theoretical explorations into concepts of cyberspace versus geographic space and the

2 implications of the creation of this relatively new concept of cyberspace are discussed. The theoretical concepts of dependency and world-systems theory and world cities serve as a framework for placing Vietnam with respect to the internet in the global economy, while the ideas of uneven development are applied in analysing the spatial distribution of the internet in Vietnam. The policy agenda surrounding the internet is highly influenced by the transnational capitalist class and Leslie Sklair's theoretical framework for this concept is employed in analysing the political economy in this respect. In addition, Michel Foucault's analysis of power and discourse and Jiirgen Habermas's theory of communicative action provide a theoretical basis for examining mechanisms of control and possibilities for public debate and democracy through the internet in Vietnam. Chapter 3 provides a brief historic overview of Vietnam. It also includes a detailed review of developments since independence with a particular focus on the post doi moi policy agenda, social, economic and cultural development as well as regional variations within Vietnam. The development of the internet and predecessor networks as an emerging new technology in Vietnam in the 1980s is being traced in chapter 4. This chapter also includes a comprehensive review of internet legislation in Vietnam and the process of formulating public policy. Such policies include the areas of control over communication infrastructure within Vietnam and international connections from Vietnam as well as internet content and surveillance. These themes are discussed in the context of Michel Foucault's and Jiirgen Habermas's theories. The spatial distribution and uneven access to the internet across Vietnam are explored in chapter 5. Differences in urban and rural areas as well as financial restrictions of accessing the internet are analysed first. Secondly, specific uses and their spatial implications as well as surrounding discourses of global integration and opportunities in the global market place are reviewed in this chapter. Finally an analysis of specific cases of internet use is applied to place Vietnam within the context of world systems theory and to demonstrate the channelling of resources both into as well as out of Vietnam. Chapter 6 concludes this thesis with a brief summary and analysis of the major components.

3 Methodology

A primary source of information for this thesis is publicly available news reporting. In addition, the work relies on statistical data and policy documents as well as

secondary academic literature. After a systematic review of the theoretical literature inv chapter 2, the overview of Vietnam relies primarily on secondary academic literature as well. The analysis of Vietnam's internet policy is based on the review of policy documents, including government decrees, as well as news stories retrieved through a comprehensive search of English language publications in Vietnam using the database Factiva1. Due to limited coverage of some publications for only a short period of time in the database, the three publications Vietnam Investment Review, Vietnam News Agency Bulletin and Vietnam News Brief Service form the primary basis for the research. All sources are published in Vietnam, which means they are under the influence of the Vietnamese state and are likely undergoing some form of censorship or at least editorial control. However, given their publication in English they are probably targeted towards a non-Vietnamese audience and published, at least partly and certainly in the case of the Vietnam Investment Review, with the intention of attracting foreign investment as well as portraying Vietnam positively in political terms. However, the Vietnam News Brief Service provides a daily summary of domestic issues covered in the Vietnamese Press, focusing on banking, financing, investment and trade. Although the selection of stories from the Vietnamese press is likely made with specific but not stated intentions, this source covered some viewpoints not given in the other publications. A list of all publications included in the initial search and information about the publications as provided by the database can be found in Appendix 1. An initial search for the term "internet" between January 1st, 1990 and the day of the search December 8th, 2005 returned 2088 stories, of which I reviewed all stories in 2005, making an initial judgement about the value of the information for the thesis, and a brief classification into one or a few keywords before saving the story in an electronic file, if considered of value for the thesis. Generally all stories referring to the internet in Vietnam were kept, while articles that covered, for example, news of on-line services in

1 Dow Jones Reuters Business Interactive LLC

4 the United States about the American War (Vietnam War in the United States) or internet sites with travel information were discarded. In addition, a search for "internet AND decree", applying Boolean logic, between January 1st, 1990 and December 31st, 2004 returned 80 stories, which I reviewed all following the same procedure as above, and a search for "internet cafe OR cyber cafe" between January 1st, 1990 and December 31 st, 2004 returned 17 results, all of which I reviewed as well following the same procedure. The inclusion of the term decree is based on the interest in internet legislation in Vietnam, which is provided in government decrees. During the initial review internet cafes, sometimes also called cyber cafes, were regularly appearing in the context of internet development in Vietnam, especially as spaces of contestation and these terms were therefore included in the extended search. After these initial searches, I also performed specific searches in the database Factiva as well as on the world wide web using the search engine Google (from Canada), if there seemed to be a need for additional information on a particular detail, as for example in the case of internet dissidents. These news sources were also used to explore specific cases of internet use and gain information about the internet in specific parts of Vietnam. Moreover, they served as a source for compiling specific data on the development of the internet, as for example internet subscriber and user numbers, which were not available to me for all years through official sources. The analysis of the spatial distribution of the internet relied primarily on statistical data published by government agencies in Vietnam on the internet or through statistical year books and other publications. These sources include the annual statistical year book as well as data from the 1999 census and data published by the Vietnam Internet Network Information Center. These data were used for the generation of specific statistics, visual analysis through graphs and maps as well as basic statistical analysis. The choice of Vietnamese news sources for collecting information for this thesis poses obvious limitations. The reporting and selection of stories cannot be influenced by the researcher and specific publications follow particular agendas and cater towards specific audiences causing bias towards some issues while understating others. Moreover, some form of editorial control can be assumed. At the same time, however, the

5 publications used in this study provide a Vietnamese point of view that is not reported through the eyes of western journalists. I have lived and worked in the Vietnamese capital Hanoi and the province of Ha Tinh for two years from April 2002 until March 2004. During this time I have lived within Vietnamese society and worked with Vietnamese institutions, which does not directly contribute to specific details of this thesis, but is invaluable in putting information into perspective.

The thesis aims at providing a general analysis of the political economy of the internet in Vietnam with a specific focus on the use of the net by the government and the VCP as well as private businesses. It can therefore only touch and not do justice to myriad issues surrounding the internet, including women's issues and minority rights. Finally, while this is a study of the internet in Vietnam, many ideas and concepts explored will most likely apply in a general form to many other places, including those with western liberal democracy. Vietnam serves as a case study that is intended to shed light on some issues of surveillance and political manipulation as well as uneven development with respect to the internet. There is no state immune to all of these issues and to varying degrees they will apply to many countries.

6 Chapter 2: Literature Review

Research on internet geography is a relatively little developed field of study, partly because the Internet as such is a relatively recent phenomenon, partly because its geographic implications were not immediately recognised by the academic community. This chapter will review the existing work on the geographic and social implications of the Internet and combine the literature on internet geography with selected works on globalisation and social theory as well as selected works on the socio-economic development of Vietnam.

Internet Geography

In the early days of the Internet numerous works hypothesised that distance and location would soon become obsolete concepts. Representative of many of these works is the book The Death of Distance, in which Frances Cairncross (1997) provides a sweepingly optimistic view of the possibilities of telecommunications. Location, she argues, will no longer be key to most business decisions and companies will simply "locate any screen-based activities anywhere on earth", moving to where the best results in terms of productivity and skills can be achieved. Similarly, her optimistic view prophesises that most people on earth will eventually have access to broadband networks. She continues to argue that national legislation will be inadequate for policing the internet as content will sweep across national borders. Cairncross's view is symbolic for the unlimited optimism that was and is associated with the internet, especially during the early years of its existence in the mid 1990s. More recent developments suggest, however, that location factors remain important for business and that there is a growing tendency for the concentration of businesses in urban centres. Moreover, access to the net, especially via broadband connections, remains limited in many rural areas and there are great inequalities with respect to access to the internet (Dodge & Kitchin, 2001, p. 5). Nation states are finding ways to enforce national legislation and policies, and are able to limit international content on their networks, as is for example the case in China (see Qiu,

7 2004), and authoritarian regimes harness the internet and other mass media to further their own political and economic objectives (Rodan, 2004). Cairacross's analysis assumes ubiquitous availability and access to ICT infrastructure. However, numerous studies have identified that telecommunications infrastructure is highly concentrated and connections to big cities have much greater capacity than those to rural areas. Sassen (1998) for example recognises the inherently spatial structure of the internet and the fact that access will depend on financial resources (p. 185). Although she does not see any "condition for authoritarian or monopoly control", she warns of "cyber-segmentation" and "'firewalled' citadels on the web". There are myriad accounts that indicate the rising importance of cities, especially world cities or global cities, as digital service providers and centres of development and commercial activity. Manhattan, for example, has the highest concentration of internet activity on earth and specialised urban districts, such as New York's Silicon Alley become the primary places for Internet and multi-media skills (Graham, 2002, p. 77). Generally investment in research and development, especially of ICTs, is not a footloose industry, but highly associated with regional innovation clusters, as for example the Silicon Valley, and these clusters are most successful in attracting new investments that require highly specialised knowledge. In spite of all technological advances in telecommunications, it is - ironically - these regions that facilitate the necessary knowledge spillover between organisations that make technological innovation possible (Audretsch & Feldman, 2000). Similarly, bandwidth of the internet backbone shapes increasingly the spatial economy nationally and globally (Malecki, 2002). Given the great dependency on high-capacity infrastructure, the geography of communication networks is one of exclusion as well as inclusion (Castells, 2001, p.238). Individuals and communities can be selectively excluded from the spaces of flow (Castells, 2000) that are of ever greater importance in facilitating the exchange of information, especially for commercial purposes. Graham and Marvin (2001, pp. 200- 201) observe the creation of a tunnel effect by "unbundled infrastructures" that interconnect cities into systems of hubs and spokes and span across and exclude "non- valued territory" within and between cities.

8 A comprehensive discussion on the socio-spatial implications of cyberspace is provided by Dodge and Kitchin (2001a). The authors use the term cyberspace for the conceptual space within ICTs and thus their discussion goes beyond the impacts of a particular technology, as for example the internet. Although the emergence of increasingly powerful ICTs has significantly disrupted the spatial logic of modern societies, it has by no means rendered it obsolete. ICTs have for many purposes reduced the friction of distance, but we still live in a material society and thus depend on the provisions of a geographically organised economy to provide food, shelter, human contact and consumer goods. Cyberspace is an integral part of time-space compression and provides businesses with an opportunity to reorganise into multi-product and multi- market corporations that foster the modes of flexible accumulation and thus receive more easily a 'spatial fix' (Daniels, 1995 and Martin 1995 cited in Dodge & Kitchin, 2001a, p. 18; see also Harvey 1985, 1989). Regardless of improvements in telecommunications, face-to-face contact remains of major importance. There is little evidence that the development of telecommunications has historically led to spatial dispersion of activities. The invention of the telephone was immediately followed by the development of high-rise offices in New York and Chicago and in France personal business traffic has increased at the same rate as telecommunication traffic for more than a century (Hall, 1999, p. 174). Some commentators argue that developments in communication technology since the invention of the first instantaneous communication device, the telegraph, have been incremental changes rather than revolutionary breakthroughs (Dodge & Kitchin, 2001a, p. 6). Dodge and Kitchin (2001a) caution against the notion of placelessness created through ICTs, because local processes continue to affect global processes and places usually retain a 'sense of place'. In Vietnam the diffusion of the internet proceeded slowly and the country had a very low rate of internet adoption, especially in the early years, in which the access to the net was available. Less than 0.25 percent of the population subscribed to the internet in 2002. The availability of full access to the internet since late 1997 was welcomed especially by businesses and western expatriates, a group with high incomes or financial resources (Lam, Boymal & Martin, 2004). The development and adoption of ICTs in

9 Vietnam needs to be considered in the specific socio-economic and historical context of the country. The adoption of the technology in a poverty reduction project, for example, has been slow and ICTs did not lend themselves to the specific purpose of information exchange amongst geographically dispersed researchers in Vietnam, because of a tradition of restricted information flows and caution in voicing personal opinions (Boyle, 2002).

There is a large body of research that suggests an inherently spatial structure of the internet, shaped by the physical infrastructure of fibre-optic cables, satellites and network switches as well as socio-economic restrictions as for example pricing structure. Given this spatiality that is contrary to the optimistic views that any digital work can be located anywhere on earth, an examination of uneven development and heterogeneous geographies in relation to the development of the internet is a critical task within the greater debate on globalisation.

Dependency and World Systems Theory

A radical school of thought in the field of development studies emerged in the late 1960s around a group of Latin American economists that viewed the perceived underdevelopment of Latin American countries as a result of colonial and post-colonial conditions. This dependency theory argues that through imperial relationships resources are transferred from colonised or previously colonised countries to industrialised countries creating a process that thus hinders the development of poor nations. This view rejects the notion that development occurs in a predetermined sequence of stages of development (cf. Rostow, 1960) and was therefore rejected by the liberal establishment in the United States and many Latin American communists alike. It is also a response to euro-centric theories of modernisation that assert that development can only take place through modernisation and will follow a pre-determined path resembling that of European countries. Andre Gunder Frank (1972) refers to a global metropolis-satellite structure, wherein the industrialised countries of Europe and North America make up the global metropolis at the centre of the world economic system with links to its satellites, namely

10 the former colonial empires. In a hierarchical order smaller places serve as satellites to larger satellites, which in turn are linked to national metropolises, which are again the satellites of the global metropolis, i.e. North America and Europe. In his thesis of the development of underdevelopment Frank describes the process of capital and resource transfer from the underdeveloped to the developed world as follows.

When we examine this metropolis-satellite structure, we find that each of the satellites [...] serves as an instrument to suck capital and economic surplus out of its own satellites and to channel part of this surplus to the world metropolis of which all are satellites. Moreover, each national and local metropolis serves to impose and maintain the monopolistic structure and exploitative relationship of this system [...] as long as it serves the interests of the metropoles which take advantage of this global, national, and local structure to promote their own development and the enrichment of their ruling classes (p. 6).

Although the internet with its network structure might be a suitable technology to overcome such a metropolis-satellite structure, in practice it depends on the availability of communication infrastructure, mainly fibre-optic cables, that are geographically selective and concentrated in North America, Europe and parts of the Asia Pacific region. Geographically the internet "resembled a star with the United States at its center" in the late 1990s (Cukier, 1999, p. 53 cited in Castells, 2001, p. 209). Internet traffic between or within two continents other than North America were routinely routed through a US node of the Internet, although increasing bandwidth in other regions may change this geography of flows (Castells, 2001, p. 209). Three important hypotheses are developed by Frank (1972) in 'The Development of Underdevelopment'. First, the world metropolis of Europe and North America will develop unrestrictedly, while the development of lower ranking metropolises and satellites is limited due to their status as subordinates; second, satellites developed most when the ties to their respective metropolis were weakest; and finally, the most underdeveloped regions today, both politically and economically, had the strongest ties to their respective metropolises in the past. The argument developed in 'the Development of Underdevelopment' was widely interpreted as asserting that without a socialist revolution underdeveloped countries would remain locked in their current position. Frank was criticised for this view by Marxists, because they saw considerably more potential for industrialisation in poor

11 countries and thus the creation of a bourgeois class, which would be the precondition for socialism. Bill Warren (1973) for example pointed to higher overall manufacturing growth in the 'third world' than in the industrialised countries in the 1950s and 1960s, . suggesting a narrowing gap and high potential for industrialisation, thus refuting the argument of dependency. Based on the early works of dependency theory Immanuel Wallerstein (1974, 2004) developed the world-system theory. Following the idea of a metropolis-satellite structure, he argues that with the beginning of European colonialism a number of core countries, i.e. the industrialised countries, emerged and a structure of core, semi- periphery and periphery was established. While primarily based on economic factors, this capitalist world-system is highly dependent on various actors including state governments, which pass legislation that allows the protection of capitalist interests nationally and internationally. Just as the dependistas argued that economic relations between core and periphery are an unequal exchange, Wallerstein refines this argument, by pointing to various protectionist mechanisms implemented by governments of the core countries. In spite of continuous rhetoric about free trade, no trade is ever truly free in the sense that there is no interference from governments or other actors. These protectionist mechanisms include tax policies and the provision of infrastructure, which is used by private businesses and provides an advantage for firms in the core countries due to greater resources in these countries. While in the post World War II era the unequal exchange was mainly based on the provision of raw materials from peripheral countries to core countries, and the sale of value added goods, mainly manufactured products, to the peripheral countries, many manufactured goods ceased to provide the same returns to core countries. Instead, other industries are now producing value added goods that continue the unequal exchange, as for example pharmaceutical or bio-medical research, software and high-tech developments and other high-end goods and services. These industries continue to be protected through patent laws and copyrights as well as direct state support and subsidies, at least for a period of time, which will allow the core countries to develop new products that will then become the higher value added goods. This evolution of economic sectors

12 in the world system is best illustrated by the textile industry, which was the primary core industry in the early 1800s, concentrated mainly in England, and is now one of the most competitive industries in the world with production taking place in almost every country around the world (Wallerstein, 2004, p. 29). Wallerstein thus responded to the argument of some mobility of countries within the world system, but maintained Frank's core argument of a hierarchical structure. The classification into core, semi peripheral and peripheral explains the status of countries that include both peripheral and core functions. Obvious contemporary examples are India and Brazil, which export core products such as pharmaceuticals or automobiles to peripheral regions, but also import more "advanced" products from core countries (Wallerstein, 2004, p. 30). It is important to note that countries or regions can "move" up or down within the hierarchy of core and periphery and that this mobility is not unidirectional.

World City Research

A prominent field of research that emerged out of the overall debate on globalisation as well as world-systems theory focuses around the emergence of a hierarchically organised network of world cities. Wallerstein's construction of the world- systems theory relies on national states as the major unit for territorial organisation. From its beginning, world city research has analysed the role of capital accumulation and corporate structure as a main characteristic for the formation of a global economic system that is centred around world cities, rather than the nation state (see e.g. Friedmann & Wolff, 1981; Friedmann, 1993). This field of study emerged as an influential lens of geographic research in the early 1980s as the power and influence of nation states seemingly eroded under the influence of Thatcherism and Reganomics and other neo- liberal policies. Although Hall (1966) first coined the term world city, Friedmann and Wolff (1981) started to analyse world cities as an interlocking network of leading urban centres. They investigate the technological bases for the expansion of capital accumulation and the critical role of research and development. They also explored the differential mobility of capital, labour and land as well as the role of transnational elites. Due to these factors,

13 transnational capital in its desire for expansion is dependent on large urban centres, the world cities, as places that facilitate the expansion and act as nodes in a larger system. Building on world-systems theory, which analyses economics on a global scale in order to go beyond the orthodox study of national economies, as well as Jane Jacobs's (1984) work on Cities and the Wealth of Nations, which employs sub-national territorial units for economic analysis, Peter Taylor (2004a) refines the global core-periphery model through the analysis of world cities, which in many respects have become the major building blocks in the global economy. Hence the network of world cities is a hierarchically organised system spanning the globe with the highest ranking cities at its centre. The early assumption of world city research that the power of the national state is eroding has been refined recently through concepts of glocalisation (e.g. Brenner 1998, Swyngedouw, 2004). Brenner (1998, p 3) argues that the state is "rearticulated and reterritorialized in relation to both sub- and supra-state scales", as global cities function as a major locus for capital accumulation for their respective states, which are closely integrated and intertwined in local city processes. Prior to the establishment of the Westphalian Interstate system, named after the treaty of Westphalia in 1648, cities were the dominant territories for economic development and control and sophisticated networks had arisen across Europe and Asia (Braudel, 1984; Abu-Lughod, 1989). Thus the national state as the primary territory for political, economic and cultural organisation has existed only for a fairly short period of less than 400 years and the current reconfiguration suggested by Brenner is likely part of temporal variations with respect to which level of geography is the centre of socio-economic and cultural dominance. Since the publication of Saskia Sassen's (1991) thesis of a triad of world cities The global city: New York, London, Tokyo world city research tended to focus on the analysis of producer services, as one of the defining factors for world city status, because of the capital commanding power of producer services, especially banking, accounting, legal services and advertising (see e.g. Beaverstock, Taylor & Smith, 1999). The size of a stock market or the number of headquarters of transnational corporations would be applied for city rankings (e.g. Sassen, 1991). In addition to producer services, various indicators for network formations have been used to create a ranking of interconnectedness of world cities. These indicators include analyses of cross references

14 of city names in newspapers of multiple cities, air traffic between cities, migration patterns of corporate elites and telecommunication connections (see e.g. Beaverstock, Smith, Taylor, Walker & Lorimer, 2000). The strength of connections between cities have also been analysed by mapping the location of large firms' headquarters as well as their subsidiary offices (see e.g. Beaverstock, Smith, Taylor, 2000).

World city research has been criticised for its lack of empirical data and the absence of data that can easily be compared amongst multiple cities (e.g. Short, Kim, Kuus, Wells, 1996, Taylor, 2004a). The Globalisation and World City (GaWC) Study Group and Network2 has established large data sets to rank world cities and conduct research (see Taylor, Catalano, Walker, 2002). Recent works on world city formation and networks include analyses that go beyond the study of producer services and include networks of global governance and global civil society (Taylor 2004b, 2005a, 2005b). The increasing importance of global cities as centres for commercial activity, especially producer services is important to consider in the context of a study of the internet in Vietnam. Vietnam's urban system is characterised by the dominance of the two major cities, Hanoi and Ho Chi Minh City, whereas Hanoi functions as the political centre and Ho Chi Minh City as the commercial centre, although the lines of this division are blurred. Since beginning of the reform process doi moi both cities have resumed important commercial functions and become increasingly integrated into the world market and the global spaces of flow. Stock exchanges have been established in both cities, international businesses have opened offices and international airline traffic is growing (see Drakakis-Smith & Dixon, 1997; Gainsborogh, 2003; Klump & Gottwald, 2002; Surborg, 2006). While Hanoi and Ho Chi Minh City are increasingly integrated into the world urban system, their relation to Vietnam's rural hinterland can be assumed to be changing as a result of this global integration.

2 The term Globalisation and World City Study Group and Network refers to a network of people connected to world city research through the Department of Geography at Loughborough University. More information is available at: http://www.lboro.ac.uk/gawc/index.html [25 April 2005].

15 Global Capitalism

Marxist geographers like David Harvey and Neil Smith have incorporated the concept of the Production of Space, originally developed by Henri Lefebvre (see e.g. Lefebvre, 1991), into the wider discussion of capitalist expansion. Harvey (1985) identifies three circuits of capital that include 1) a primary circuit connected to production of goods and services to be sold by capitalists, 2) a secondary circuit that channels surplus into the built environment like buildings, roads and other infrastructure, especially in urban areas and 3) a circuit that invests into research and development activities that work to make capitalism work more efficiently. The internet may function as part of any one of these circuits of capital, first as a good or service for sale for consumption, second as a piece of infrastructure, primarily urban as other sources have demonstrated, that serves as an investment and provides a return, and third as a result of research and development activities that make capitalism function more efficiently. The internet now needs to be considered part of the technological development that Friedmann and Wolff have explored, since it is a major factor in enabling world cities to act as nodes in a world urban system. Thus ICTs are yet another component in addition to existing transportation and communication infrastructure in a system of spatial organisation. While ICTs cannot change the absolute location of specific places of production, for example factories, or enhance the mobility of labour to places of production, they change the relative location insofar that the virtually instantaneous exchange of information makes a place more accessible for commodity exchange and therefore enhances the realisation of abstract labour (Smith, 1990, p. 82). Smith (1990, p. 87) recognises specifically spatial thinking in Marx's analysis of capitalism, but finds that it is rarely developed. He emphasises that the early capitalist expansion of European societies into colonial empires has been replaced after the "final partitioning of Africa in the 1880s" by the expansion into relative space through transportation, storage and communication improvements. Again, in this context ICTs are not a revolutionary process, but rather an extension of an existing process. Capitalism as a process of commodity exchange is dependent on spatially integrated systems of money exchange, credit facilities and labour mobility (Harvey,

16 1985), as facilitated in part by ICTs. At the same time capitalism is not taking place on a flat surface with ubiquitous raw materials, evenly distributed labour and equal transportation infrastructure in all directions, which will inevitably lead to "uneven development" (Harvey, 1982, p. 415-417; cf. also Harvey, 2005). The concept of uneven development provides a useful theoretical framework for understanding the formation of cities, as a process of accumulation of capital, because it creates greater efficiencies in the absence of a "flat" world. Although Harvey (e.g. 1982, 1985) bases his analysis on the situation in economies shaped by western style industrialisation, the basic ideas of uneven development are likely to apply to most places in the Global South, including Vietnam, because of the global spread of capitalism. There will of course be local and regional differences in the specific shapes and forms of uneven development if non- western countries following a euro-centric path of development and this path is getting adapted to local contexts, but capitalism remains the dominant form of production globally. This applies equally, if western style industrialisation spreads into the global south, for which many Marxist scholars see some potential, or if peripheral types of production remain dominant in the global south, as many neo-Marxists expect. The debate on specific manifestations of globalisation or various globalisations has been greatly enhanced by Leslie Sklair's (2001, 2005) concept of the transnational capitalist class. This concept provides a new lens for the analysis of class structure, because it does not limit the analysis of class struggle to the exploration of national capital owning classes. Instead it includes all elements that control the resources for the successful mobilisation of capital, rather than only those who own the means of production, and diverts from the traditional locus of class analysis, the nation state, by integrating trans-border processes. While the transnational capitalist class is internally not as tightly connected as traditional national classes, through for example intermarriage, the members are bound together by their common interests, such as the protection of private property and the right of accumulation thereof with as little interference as possible. For analytical purposes Sklair (2001, p. 17) identifies four main fractions of the transnational capitalist class: 1) executives of transnational corporations and their local affiliates (the corporate fraction); 2) globalising bureaucrats and politicians (the state fraction); 3) globalising professionals (the technical fraction); and 4) merchants and

17 media (the consumerist fraction). The notion of an international bourgeoisie was central to dependency theory, but is centred around the state as the primary unit of organisation. Sklair attempts to identify a class that transcends the national to replace it with the global. Ruling any jurisdiction or area is difficult and unlikely to last for long without control over the means of production or the support of those who own these means. Thus many dictatorships and governments have moved to being the owner of the means of production or more recently turning politics into a form of business. The dominance of the transnational capitalist class does not need to be universal in order to be the overall dominant global force. In some countries or parts of countries other groups, such as religious organisations or the military, may be the dominant force, but the transnational capitalist class has the means to dominate in strategic localities, as for example those with valuable natural resources. In such cases it can form alliances with local rulers, even in the absence of a local capitalist class and thus remain the most powerful class globally (Sklair, 2001, pp. 14-15). Although the concept of uneven development is helpful for understanding economic processes, it provides little or no insights into the socio-cultural dimensions of development processes. Similarly, while the concept of the transnational capitalist class is useful for the analysis of socio-cultural connections in the global economy, it leaves considerable ambiguity as to how the transnational capitalist class interacts with its local agents and how this process affects the development of capitalism in various locales. It is therefore important to explore the sub-national socio-cultural dimensions of society in a study of internet development in order to adequately address the interrelation between economic, social and cultural spheres of this development. The works of Michel Foucault and Jiirgen Habermas are amongst the most influential in this context.

Social Theory

The theoretical treatments of discourse analysis and power by both Michel Foucault and Jiirgen Habermas have been instrumental for many aspect of social science research and have both been employed in research on Information Systems, ICTs and Cyberspace (see e.g. Mingers and Willcocks, 2004; Dodge & Kitchin, 2005). There is,

18 however, a tension between the normative and the real, i.e. between what should be and what is, in the combined work of the two thinkers (Flyvbjerg, 1998). Habermas's work on The theory of communicative Action (1984, 1987) suggests that members in a society should engage in a radical discourse of all parts of society to arrive at the best possible understanding and find the best possible decisions in response to collective challenges. The rules for this discourse have to be provided by a higher authority for which Habennas suggests the writing of constitutions. With respect to process Habermas favours a top-down approach, i.e. a normative provision of the rules for this radical discourse in form of a constitution and laws. With respect to content, on the contrary, he supports bottom-up approaches, in which truth is not a given, but emerges out of contributions by the participants in specific situations (Flyvbjerg, 1998, p. 214). Constitutions, however, are without value for the formation of a radical discourse, if citizens have not accustomed themselves to the values in the constitution and comprehend the constitution as an attainment (Habermas, 1994a, p. 514). Habermas emphasises the importance of institution building and considers law the adequate instrument to authorise power, whereas this must occur together with the sanctioning of law by power, a point that contrast.Foucault's conceptualisation of power (Flyvbjerg, 1998, p. 214). Habermas's point follows the modern idea of the state's monopoly on violence. Foucault (1990) has traced the development of what he calls bio-politics throughout the period of industrialisation of Victorian England, where sexuality was suppressed and confined to the spaces of the home, i.e. the private realm, which highlights the modern tension between private and public that emerges at the same time. Moreover, sexuality was reduced to an act with the sole purpose of reproduction rather than a pleasurable experience. For Foucault power is inescapable and manifested through an omnipresent moral discourse and disciplinary mechanisms of society, such as institutionalised rules of behaviour. He refines the point of omnipresent disciplinary power in his book Discipline and Punish (Foucault, 1995). Using the example of the modern prison, he analyses the role of the panopticon in disciplining the inmates in their bodily actions. The architecture of prisons would allow the permanent and complete observation (i.e. panopticon) of inmates. But even if observation was not permanent, the

19 possibility thereof would be sufficient for self-discipline. Other examples of such architecture include boarding schools or manufacturing workshops. Although Habermas (1994b) agrees that Foucault's analysis of the panopticon is correct in individual instances, he rejects it in its generality. The panopticonism of modern punishment is not characteristic of modern society as a whole and the analysis is oblivious to the development of law. Habermas (1982) traces the development of modern social structures in western Europe in detail and observes a shift of power from the state to an emerging liberal civil society, dominated by bourgeois elements. His later works on communicative action suggest a radical discourse that includes all elements of society, which highlights an inherent tension with Foucault, who considers current conditions of power inescapable. Dodge and Kitchin (2001, pp. 18-20) highlight the tension between public and private domain in cyberspace. As highlighted in the works of Foucault and Habermas, the separation of the two is an important characteristic of modernisation and concepts of places for living, i.e. home, and places for other activities have been fundamental in the organisational structure of western society for a long time. Public spaces have been important in facilitating debate in civil society and have included actual public spaces as well as semi-public arenas, such as cafes and other businesses, e.g. stores. One of the earliest critical evaluations of the internet, or cyberspace of which the internet is an essential part, was provided by Julian Stellabrass (1995). He notes that uneven technological development, pricing structure and technical skill are restricting access to cyberspace for a wider public. An open anarchic culture was prevalent on the net in its early years of development, because participation was limited to certain individuals with technical skills and resources and thus forming a virtual community of equals. However, for society at large cyberspace would be of little advantage for creating Habermas's Utopian society in which agreement would be achieved through a reasoned and radical discourse. Bulletin Board Systems, for example, are often dominated by a few active suppliers of information that dominate themes and jargon, while the majority consists of quiet receivers of information of this quasi broadcasting technology. Interactive possibilities are largely underutilised due to social manifestations in cyber space (Stellabrass, 1995).

20 While on one level cyberspace has created new possibilities for tracing individual actions through trails left on digital records, such as institutional databases, financial transactions or images of surveillance cameras, cyberspace has - paradoxically - been considered as creating new public spaces for social interactions. Much content on the internet, especially through the world wide web, is still publicly accessible, but more critical reflections suggest that cyberspace and particularly the internet become increasingly regulated and controlled through private concerns. These mechanisms of control include password protections of specific sites, copyright laws that allow content for sale and even the initial points of entry to the internet, i.e. Internet Service Providers (ISPs) (Dodge & Kitchin, 2001, p. 19, Stellabrass, 1995). Most recently the search engine Google has agreed to comply with censorship requests from the Chinese government and • blocks most links from results pages, when searching for certain words from within China (Thompson, 2006). In spite of these restrictions, the internet provides potentially new forms of communication. Through the potential of downloading (receiving) information from the internet and uploading (providing) information modernist structures of communication are blurred. The roles of broadcaster and listener, producer and consumer of information can potentially be combined and therefore change the structure of modern communication. Such interactive practices can be facilitated for instance through chat rooms, Bulletin Boards or web-sites (Dodge & Kitchin, 2001, p. 20). More recently blogs should be included in this list. However, these potential uses of cyberspace must always be viewed in the context of access to infrastructure, cultural and language barriers and power relations within cyberspace. One of the conditions for successful communicative action and achieving mutual agreement based on radical discourse is that all participants are expressing their intentions openly and clearly in order to not mislead the other parties (Habermas, 1984, p. 99). However, this pre-condition limits the practical application of the theory, because rarely will a discourse be completely open and without hidden intentions. What appears to be communicative action with the noble goal of achieving consensus, may in fact be covert strategic action, if one party has already decided that it will not negotiate (Klein & Huynh, 2004, p. 187). Cyberspace is no better locus for overcoming this challenge to the

21 theory than any other space. Due to its impersonalised forms of interaction, it may in fact be a most problematic space for radical discourse. The above discussion highlights the same tensions between possibilities (the normative approach) and reality that is characteristic in the works of Foucault and Habermas. On one hand there is potential for change towards a more democratic and open society through the internet, because of its ability to change the forms of communication; any analysis, on the other hand, cannot be conducted without consideration of the current power relations, which include direct political control of the net, but possibly more importantly restrictions imposed through uneven access to resources by both individuals as well as whole cities, regions or countries.

An Analysis of Internet Development through Multiple Perspectives

The relevant literature of several themes has been highlighted in this chapter. First, an overview of the topic of internet geography highlighted the spatial dimensions of cyberspace and outlined how the notion that the internet has rendered geographic space obsolete was refuted in the literature. Second, the section on World System and Dependency Theory shows how these theories have influenced historic and contemporary debates on development as well as class and neo-colonial global structures. Third, a brief discussion on world city research highlighted the emergence of large urban centres as the command and control nodes in a global urban network, followed by a brief discussion on the globalisation of capitalism. The final section examined the work of several authors on social theory as it relates to issues of civil society, with a particular focus on communications and information technology research. Foucault's analysis of power and Habermas's work on communicative action and discourse ethics were a major focus of this section. The internet is one means to integrate Vietnam into global networks of capital, many of which are constructed around urban centres, class based and neo-colonial in character. New technologies have altered and reconfigured existing socio-spatial relations, but these changes follow pre-existing structures of government and economic relations. It is therefore the intersections between the above themes that are most relevant

22 for this thesis. While geographic bridging that the internet can achieve is important for Vietnam's integration into the global economy, the social relations of myriad of actors in these networks are central to shaping the specific dynamics. Thus it is crucial to consider the topic of the development of the internet in Vietnam from various perspectives and theoretical lenses.

23 Chapter 3: Towards Full Scale Liberalisation: An Overview of Vietnam

Although outside influences on Vietnam have been strong for centuries, the country has maintained a strong national identity. Major forces in Vietnam were China, France, Japan, the United States of America and the Soviet Union. This chapter provides a brief historical overview of the country and outlines the main socio-economic and political issues in contemporary Vietnam, with a strong focus on the doi moi reforms, which were initiated in 1986. In addition, the changes in Vietnam's civil society as well as the public administration are examined. The chapter finishes with a brief summary of regional structures and disparities.

Pre-colonial Era and French Colonialism

Although the French had been backing the spread of Catholicism in Vietnam and attempted to gain influence in the kingdom since the 18th century, it was not until 1858 that the European power attacked the territory that was under the Nguyen dynasty at the time. Vietnam's history throughout the millennium is rich and Vietnamese independence was recognised by China as early as 972 AD (in the Christian calendar) (Boudarel & Nguyen Van Ky, 2002, p. vii; Kolko, 1986, p. 13). A small agricultural and fishing village was located at the site of today's capital Hanoi as early as about 4000 years ago and archaeological investigations show evidence of a fairly diversified culture including agricultural cultivation, livestock breeding as well as pottery and metal production, including bronze engraving (Sidel, 1998a, p. 1). By 1884 the French had conquered Vietnam and ended the Nguyen dynasty. They divided the country into three administrative regions: Cochin China in the south, Annam in the centre and Tonkin in the north (Kolko, 1986, p. 13). The Vietnamese economy was highly regionalised and there was little trade between the north and the south. Under French rule the colony developed several major export commodities, mainly based on mining in the north and plantation agriculture in the south. Until 1936 the Vietnamese

24 railways consisted of two separate networks in the north and the south and the last connection between the two was only finished that year. Railway construction was extended in the south during the 1930s to provide access to the rubber growing areas and roads were constructed into the highlands of Annam (today's Central Highlands region). There was some regional trade of manufactured goods from the urban areas in the south to the rural Mekong Delta (also in the south) and raw materials in the other direction. In addition, there was a small domestic textile industry in the north (Beresford, 1989, pp. 19-20).

One of the major impacts colonisation had on Vietnam were profound changes in the land system. These changes resulted in high concentration of land ownership. First the French gave large land grants to French settlers and Vietnamese collaborators in the agriculturally well developed Tonkin region, especially the Red River Delta. After 1900 this practice was extended into the Mekong Delta in the Cochin China region and on a smaller scale to Annam. By the 1930s land was extremely unevenly distributed, especially in the Mekong Delta, where almost three fifth of the rural population was landless (Kolko, 1986, pp. 14-15). Land concessions in the 1930s amounted to two thirds of all agricultural land, of which 872 000 hectares were held by French landowners and 1.95 million hectares by Vietnamese. In the early 1930s communal land was reduced to 20 percent in Tonkin, 26 percent in Annam and only 2.5 percent in Cochinchina, while the majority of small land holders had extremely small holdings (Ngo Vinh Long, 1973, pp. 15-19). Land distribution remained a crucial issue in Vietnam throughout the 20th century and continues to be a point of contestation in contemporary Vietnam.

Post World War II until Unification

After the surrender of Japanese forces in August 1945, which had occupied Vietnam since 1940 during World War II, the Indo-Chinese Communist Party under the leadership of Ho Chi Minh declared independence of Vietnam on September 2nd, 1945. However, the French wanted to reinstate colonial rule and British and French troops arrived in the south, while Chinese troops entered the north. In spite of considerable support from the United States to the French, the Vietnamese won an eight-year war

25 against the French and following the Geneva conference in 1954 the country was temporarily partitioned along the 17th parallel with Ho Chi Minh becoming the leader of the north under communist rule and Ngo Dinh Diem becoming president of the US supported south. Although the Communists were widely expected to win reunification elections scheduled for 1956 under the Geneva Accord, no elections were held and the country remained divided until official unification in 1976, following the military victory of the north over the south a year earlier at the end of the American war, which had escalated in the mid 1960s (Forbes & Thrift, 1987; Beresford, 1989; Boudarel & Nguyen Van Ky, 2002). The economies of the two parts of Vietnam developed substantially differently between 1954 and 1975 given the ideological differences of the governments. The north adopted a centrally planned system following the Soviet model and some Chinese influences and proceeded with large scale collectivisation of agricultural production, while the south retained a capitalist economy with a government that relied on the support of a land owning class and thus made very little progress with any reform of the land system (Beresford, 1989, p. 49; Forbes and Thrift, 1987). Questions regarding land remained central to both governments. In the north collectivisation was intended to increase participation of the rural populations in decisions regarding agricultural production under government guidelines and increase agricultural output (Forbes and Thrift, 1987, p. 105). However, collectives also allow for easier control of the rural population by the central government through hierarchical structures of organisation. The population density in the two main deltas, the Mekong and the Red River deltas, had long been a concern to administrations and this continued to be the case for the north Vietnamese. For the years between 1961 and 1966 mass population movements were therefore planned from the Red River Delta to New Economic Zones in the northern highlands (Forbes and Thrift, 1987, p. 106). In the south the government attempted various reforms of rural administration and settlements, which mainly included regrouping of populations and attempts to increase local economic decision making. However, the plans proved to be unsuccessful primarily because populations would have to move farther away from their fields to rural towns and because communist

26 organisations in the country side could successfully mobilise against the plans (Forbes and Thrift, 1987, pp. 101-104).

Building a Socialist Vietnam

The task of re-unifying Vietnam after almost 20 years of effective separation and a devastating war was overwhelming and came sooner than expected since the South Vietnamese Army barely survived the withdraw of American troops in 1973. After unification the Communist government of Vietnam extended its policy of collectivisation of agriculture to the south and employed a rather orthodox strategy to achieve socialism during the first few years. However, only three years after unification it introduced 'New Economic Policies', which allowed for new production incentives and decentralisation of parts of the economy. Further reforms were discussed and officially agreed to at the fifth Congress of the VCP held in March 1982. The reforms were incorporated into the third five-year plan (1981 - 1985) and recognised the legitimacy of individual private enterprise and the term 'market socialism' emerged. In 1980 there had been food riots in the north, namely in the port city of Haiphong and the province of Nghe Tinh, the birth place of Ho Chi Minh. Such riots were not expected in the north- and the refonns are likely a partial response to them. One of the key figures in introducing these reforms was the chairman of the State Planning Commission Vo Van Kiet, who became Prime Minister in 1991. He was backed by party Secretary General Le Duan (Forbes and Thrift, 1987, pp. 108-113). Even before the more profound reform process of doi moi started in 1986 Vietnam was not a static monolithic state, which was inflexible and orthodox in all policies and economic action . Rather, the state adapted to changing pressures and demands within the framework of being a communist country closely aligned with the Soviet Union, which followed a rather orthodox and statist path under the rule of Leonid Brezhnev throughout the 1960s, 1970s and early 1980s (cf. Castells and Kiselyova, 1995).

Another major challenge that Vietnam faced after 1975 were crowded conditions in its cities, which had suffered during the war, and a very high population density in the northern Red River Delta. The country embarked on a de-urbanisation strategy. The >

27 strategy had several goals. First, the pressure from stretched services in urban areas should be reduced. Second, underutilised agricultural land was to be made productive. And third, there were security reasons, especially along the Cambodian border, where soldier-civilian settlements were designed to serve as a buffer, but also in the Central highlands, where a large proportion of ethnic minorities have long been a force of resistance to centralised rule (Forbes and Thrift, 1987, pp. 114-119). The receiving areas of the resettlement programmes were mainly New Economic Zones, which usually specialised in the production of a particular product, including rice, cotton, rubber, sugar and tea. The communist leadership thus utilised the colonial economic structure left to them by the French to produce raw materials for industry and generate export income, but still faced challenges of labour shortages already encountered during colonialism. However, the plantations were now managed by state farms (Beresford, 1989, p. 105). Although the programme never reached its intended targets, the share of the urban population was reduced from 21.5 percent in 1975 to 19.1 percent in 1980, but climbed again to 21.4 percent in 1984 after the reforms of the early 1980s (Forbes and Thrift, 1987, p. 117).

The Doi Moi Reforms

Although the Vietnamese leadership had been experimenting with smaller reforms since the late 1970s, the most profound changes came with the sixth Party Congress in 1986, at which the reform process doi moi (engl: renovation) was officially introduced. After a zigzag course of reforms and counter reforms throughout the first half of the 1980s and critical levels of inflation and other economic problems, the party congress steered towards a full liberalisation and market economy. This shift in direction was further influenced by the political changes in the Soviet Union, where Mikhail Gorbachev ascended to be Party Secretary General in 1985 (Fforde & de Vylder, 1996, pp. 142-148).

The ongoing reform process has many components, most of which are economic, and political reform lags behind with many changes occurring only due to necessities created by the new economic situation. Some of the cornerstones of doi moi are the

28 opening of the country to western business and investors, the privatisation of state owned enterprises and the establishment of new private businesses and another land reform, which is for many people in Vietnam the most important issue. Although doi moi was the political framework for reforms, Jonathan Rigg (2003, p. 24) argues that the party did not actually introduce the reforms at the sixth Party Congress, but officially "accepted" or "endorsed" a market economy that was not previously sanctioned by the state, but practised by the peasantry. Under the current constitution land can still not be privately owned, but the authorities are issuing tradable land use certificates, which creates a land market that is in all its practicality no different from land ownership and has changed the social dynamics in both the urban centres and the countryside. Kolko (1997, pp. 92-95) goes so far to argue that "the party inadvertently reintroduced class struggle into the countryside", because corruption was rampant and "cadres in many villages immediately began to distribute the best land to their families and relatives, and abuse was rife". In any event, agricultural production has largely shifted to a family farm based system from a system of collective production, although in many places farm co-operatives are still playing a supportive role to individual member households (Van Arkadie & Mallon, 2003, pp. 79- 81). Similarly, in order to attract FDI to Vietnam minimum wages at foreign invested companies were set between 30 and 35 US Dollars a month in 1992, which was so low it caused labour unrest during the following years, but the government considered itself unable to act, because foreign investment would move out of Vietnam were wages to rise (Rigg, 2003, p. 35). Changes in macroeconomic policy introduced through doi moi were profound. Although Vietnam did not officially re-activate its membership in the International Monetary Fund and the World Bank until 1993, the policies introduced and implemented by the Communist government were virtually identical with the recommendations given by the two Washington institutions to all "developing countries" (Wolff, 1999, p. 26; Kolko, 1997). Again, the main components of these policies are privatisation, reduction or elimination of subsidies for production and a decrease in state spending, leading to the reintroduction of hospital and school fees (Kolko, 1997). Vietnam had re-established trade relations with many western and capitalist Asian countries in the late 1980s and

29 early 1990s, but the symbolic final opening of the country came in 1994, when the United States lifted its trade embargo against Vietnam. Many of the expectations for economic growth were based on substantial FDI to facilitate technology transfer, but after a brief influx of large sums of FDI in the early 1990s, it had slowed down by 1996 and this slow down was accelerated by the 1997 Asian financial crisis (Beresford, 2001).

Although the reforms are neo-liberal textbook policies in their official form, in practice the past 20 years were characterised by the complex set of relationships between conservative forces in the communist party, reformers, the international financial institutions (amongst them IMF and World Bank) and the Vietnamese people, who often adapted any shifts in direction for their own needs. Liberalisation has acquired a distinct local meaning in Vietnam and results are inconsistent (Kolko, 1997; Painter, 2005).

Social and political changes

The contemporary perception of Vietnam, including that of the United States State Department, is still one of a communist one-party state with all political power in the hands of the party (Koh, 2001b, p. 533). However, as outlined above, decision making in Vietnam is a highly complex process of negotiation and power struggle between various factions of the state and the party. Official reforms are often introduced after local actors have broken existing rules that are retroactively legitimised by the reforms and then labelled pilot projects (see e.g. Kolko, 1997, 2001; Koh, 2001a, 2001b; Heng, 2001; Gainsborough, 2003; Rigg, 2003; Painter, 2005). Although doi moi remains an ongoing project and an overall liberalisation of the economy and some political reforms have occurred over the past 20 years, this process followed by no means a linear pattern and political and economic changes continue to take a zigzag course. Many observers consider the first few years of doi moi the by far most liberal period. The events of collapsing communist regimes in Eastern Europe in 1989, however, made many leading officials in the party critical of the reforms, fearing that the VCP would suffer the same fate as the regimes in Eastern Europe. Since 1986 the Vietnamese press had been given relatively far reaching freedoms and was to some extent allowed to conduct investigative journalism even into the affairs of the state and the

30 party. At the seventh party congress in 1991 the monopoly on political power of the party was reaffirmed and political liberalisation halted. Since 1992 the Vietnam's people's army is constitutionally responsible, aside from the defence of the country, for the protection of the party's monopoly on political power (Abuza, 2001, pp. 18-19; Heng, 2001). Some of the most contentious issues in Vietnam are related to the press law and freedom of expression. Between 1986 and 1989 a number of unlicensed newspaper and magazines appeared and unlicensed books were published. About two-fifth of all books published in 1987 were unlicensed (Kolko, 1997, p. 128). There is a culture of debate within the party and the mass organisations, which is subject to power relations and debates often proceed cautiously, but political decisions are not made by a single individual (cf. Kerkvliet, 2001). Consensus within the party is usually reached through a compromise by several factions within the party and may be a long and drawn out process during which power relations are explored and established. The Vietnamese case is thus not unlike decision making processes in western pluralist democracy, where often two or a small number of parties, agree on an overall set of principles (i.e. free market, elections, parliamentary democracy, pluralist society etc.) and political decisions are based on minor variations in opinion that can be made depending on who has the greater access to the press, lobby groups and election finances. Nonetheless, in spite of these debates substantial political power in Vietnam remains in the central committee and particularly the politburo, which became evident after 1989, when the country had seen its greatest amount of freedom of expression. During this time high ranking officials, including the number 13 in the politburo, were expelled from the party for making critical remarks (Kolko, 1997, p. 126-127). Although the press was allowed greater freedom throughout the 1990s than during the pre-doi moi period, it did not return to the levels of the late 1980s. At the same time, the party explicitly allowed the reporting of corruption scandals amongst lower ranking officials. Especially in some areas, as for example police corruption, newspapers ran extensive coverage of specific events and forced authorities to reconsider their actions. One form of public debate is the publication of myriad and diverse letters to the editor on particular issues from diverse groups of people as well as radio phone-in shows. Vietnam has a very

31 large number of daily newspapers, magazines and specialised publications, which are all owned and controlled by an administrative unit of the state, the party or one of the mass organisations within arm's length of the party. Nonetheless, these publications also represent a wide range of civil society and often take up issues of minorities, workers or women (Thomas & Drummond, 2003; Kerkvliet, 2001; Heng, 1998, 2001; Sidel 1998b). As noted earlier political protest, especially over land distribution and associated corruption, erupted sporadically, but seriously across the country. Due to insubordination within the public administration and a lack of control over local officials (cf. Koh, 2001a, 2001b), the central authorities were unable to control corruption at the local level and the reporting of such corruption may well have been viewed as a means to diffuse local conflict, since this offered a forum for open debate and through punishing some local officials that were publicly identified as engaging in corrupt activity, the party could be viewed as taking action. At the same time, however, too far reaching critical remarks regarding the party were restricted through a legal framework that allowed party officials to repress journalists, if they felt they were misrepresented. Editors of press outlets continue to attend weekly meetings with the Ideology Department of the VCP, where they are briefed on what is expected from the press. It is clear that this is not an open debate, but an exchange between two unequal parties (Heng, 2001). This practice, too, is not unlike some power relationships in western liberal democracies, as an incident in the White House illustrates, when journalist Ron Suskind was told by a senior advisor to President George W. Bush that he is part of the "reality-based community", which is no longer relevant, because the United States is now an empire and the members of the Bush administration are the "actors of history". People like Suskind would be left to studying history without influencing it (Suskind, 2004). Generally, the state has given up some of its stringent control over the population and authorised increased individual initiatives and some autonomy to institutions and government agencies. However, there is a tendency in many southeast Asian countries that increasing economic transparency is not accompanied by political transparency. Especially after the Asian financial crisis of 1997 there were calls for more open flows of information, but these have been applied primarily to corporate reporting rather than civil

32 society and freedom of speech. Authoritarian regimes have been able to hold on to political power, while increasing economic openness (Rodan, 2004) On another level liberalisation, especially of the media, was almost inevitable, if the economic reforms, of which one aspect is the creation of a consumer society, were to be successful. As part of a consumer culture Vietnam is becoming a media culture as well (Thomas & Drummond, 2003, p.l). This shift towards a consumer society will thus indirectly but strongly influence the political climate of the country and the freedoms that have been granted to businesses and enterprises could potentially be claimed by citizens for political purposes as well. However, the consumer society is highly reliant on urban leisure and consumption spaces and newly acquired freedoms appear not to be utilised for explicit political acts, but mainly for access to popular culture, which is politically symbolic, but not explicit (cf. Thomas, 2001). There is also little evidence of a public sphere in Vietnam or public spaces for such a sphere to develop (Drummond, 2000, p. 2380). Moreover, the new consumer society is still predominantly urban and thus excludes roughly three quarters of the population outright, while many urbanites have no access to this newly emerging popular culture due to financial constraints (see Drummond & Thomas, 2003).

Regional Disparities and Inequality

Regardless of numerous efforts by various administrations, population density in Vietnam remains highest in the Red River and Mekong Deltas. In addition to this pattern, Figure 3.1 shows high population density north of the Mekong Delta around Ho Chi Minh City, a coastal pattern of settlement and some smaller concentrations around a few urban centres. Currently there are eight regions defined by the government, which act mainly as units for statistical data aggregation rather than units for developing specific regional strategies (see Figure 3.2). Administratively the country is divided into 64 provinces (including five cities administratively at the provincial level). All provinces are divided into districts and communes, following a hierarchically organised model. Generally, each unit should be of a particular size and provinces, districts and communes provincial people's committee and the respective line ministry. Each national level

33 34 Figure 3.2: Regions of Vietnam

Map: Bjflrn Surborg

35 are routinely merged or split to achieve this goal. A major challenge remains the reporting structure of provinces, where specialised departments report to both the ministry has a respective department in each province. Similar issues of a dual reporting structure exist at lower level at lower level administrative units.

A major focus of the government is currently the Comprehensive Poverty Reduction and Growth Strategy (see Socialist Republic of Vietnam, 2002). The poverty rate3 was reduced considerably from 58.1 percent in 1993 to 37.4 percent in 1998 and 28.9 percent in 2002, however the rate of poverty reduction has certainly slowed down and the regional distribution of the poor population remains highly uneven, ranging from only 10.6 percent in the Southeast Region to 68.0 percent in the North West (see Table 3.1). In addition, in 2002 only 6.6 percent of the urban population were counted as poor, but 35.6 percent of the rural population (Asian Development Bank et al., 2003, p. 9).

Table 3.1: Poverty Rates by Region in Percent 1993 1998 2002 North East 86.1 62.0 38.4 •North West 81.0 73.4 68.0 Red River Delta 62.7 29.3 22.4 North Central Coast 74.5 48.1 43.9 South Central Coast 47.2 34.5 25.2 Central Highlands 70.0 52.4 51.8 South East 37.0 12.2 10.6 Mekong Delta . 47.1 36.9 23.4 Vietnam 58.1 37.4 28.9 Source: Asian Development Bank et al., 2003.

With the exception of the off-shore oil producing province Ba Ria-Vung Tau, Vietnam's two major cities had the highest per capita income in 1999. Although Ba Ria- Vung Tau has a per capita income of more than 40 million VND per year, most of this income goes directly to the central government and reflects the wealth in the province

3 The poverty rate indicates the percentage of the population that is unable to secure a diet of 2100 calories per day plus minor necessities, as for example for personal hygiene. The average cost for the food and these necessities are derived from a so-called consumption basket that is intended to be representative of local items needed to secure the 2100 calories and basic consumption items. The value of the poverty line was set at 1.92million VND for 2002. The calculation of the poverty rate for Vietnam was based on the 1993 and 1998 Vietnam Living Standard Surveys and the 2002 Vietnam Household Living Standard Survey. (Asian Development Bank et al., 2003, pp. 1-20). The calculation of the poverty rate is a challenging exercise, because of the reliance on surveys, the calculation of the cost of the consumption basket based on averages, regional variations and calculation of equivalent values for subsistence production. Therefore, caution needs to be exercised when interpreting these poverty rates and changes thereof.

36 only poorly. Ho Chi Minh City has, with almost 15 million VND, the next highest per capita income, followed by Hanoi with just over ten million. Only eight of 61 provinces had per capita incomes of more than five million VND. The lowest is just over 1.5 million. (National Centre for Social Science and Humanities, 2001, pp. 88-89). Aside from regional disparities, especially between the mountainous and coastal regions, growing inequality is a significant concern in Vietnam. The ratio between the poorest and richest population quintile has increased from 4.97 in 1993 to 6.03 in 2002 (Asian Development Bank et al., 2003, p. 13). Another major concern is the increase in rural landlessness. The share of rural households that is landless has increased from 8.2 percent in 1993 to 9.2 percent in 1998, but more than doubled to 18.9 percent in 2002. The northern mountains, the Central Highlands and the South Central Coast regions have experienced drops in landlessness between 1993 and 1998, but that trend reversed and by 2002 the share in landlessness had exceeded 1993 levels in these regions. In all other regions rural landlessness increased between 1993 and 2002 (Scott & Truong Thi Kim Chuyen, 2004, p. 108). Poverty among the ethnic minority population in Vietnam is particularly high. About 87 percent of the population are ethnic Vietnamese (kinh) or Chinese (hoa), while the remaining 13 percent account for 52 minority groups (General Statistics Office Vietnam, 1999), most of which live primarily in the central and northern highlands. The share of the minority population living in poverty remained high with 75 percent in 1998, although it had decreased from 86 percent in 1993. In the Central Highlands 91 percent of the ethnic minority population lived in poverty in 1998 (Scott & Truong Thi Kim Chuyen, 2004, p. 110). Regardless of the high poverty rates amongst ethnic minorities, the Central Highlands remained a fairly large net receiver of migrants in the five year period preceding the 1999 census. This was a period of economic growth in the region, fuelled by high coffee prices and incomes increased nine percent annually between 1996 and 1999, but fell again thereafter (Scott & Truong Thi Kim Chuyen, 2004, p. 95). The Vietnamese government attempts to counteract some of these inequalities by subsidising basic goods for the mountainous regions to ensure price equality of food across regions and by establishing quotas for ethnic minority populations in university. However, Scott and Truong Thi Kim Chuyen (2004, p. Ill) note that such policies in remote regions

37 differ from the policies of enabling a climate for investment and development in the core regions and that many areas with high ethnic minority populations fall into the former category with few possibilities to move into the latter category. Thus, minority populations seem to be bound to passive economic behaviour and the paternalistic goodwill of the state.

No Monolithic Statism

Regardless if doi moi was an introduction of reforms by the party or merely the official acceptance of practices by peasants in the country, political changes have caused considerable changes in the lives of the Vietnamese people. The level of control the VCP currently has and had in the past is a debatable issue, but state-society relations are changing with economic reforms. Kerkvliet (2001) examines three interpretations of the political system in Vietnam. First, the "dominating state" interpretation suggests that the Communist Party is in overall control of the state and remains the dominating force in all aspects of society. Second, "mobilisational corporatism" is an interpretation that considers the Communist Party at the centre of political, economic and cultural affairs, but sees considerable leverage for a wide range of factions in the party state apparatus, such as mass organisations and specialised government agencies, to influence the public policy agenda. A third interpretation suggests that the VCP has relatively little real power and that state-society relations are primarily shaped by actions of individuals, many at the local level and with vastly different results of policy implementation locally. These three interpretations of contemporary state-society relations are also a reflection of historical interpretations of the VCP that influence current developments. Fforde and de Vylder (1996, pp. 55-69) attest that the VCP has a rather rigid past of "neo-Stalinist" policies that failed economically and require correction through liberalisation. Kolko (1986, 1997) on the other hand suggests that the VCP was a genuinely revolutionary and socialist force, which was undermined after the end of the American war by reformers that led the country on a problematic path to capitalism. Thridly, Jonathan Neale (2003) finds that the VCP gained power through its leadership in the anti-colonial movement and was, in spite of being a revolutionary socialist party,

38 heavily influenced by members of an upper class, many of who were landlords and whose families had if not given support to at least benefited from French land concessions. The history of colonialism and foreign invasion and the emergence of Vietnam as a divided country left it with many economic, social and political challenges. Uneven land distribution in both the north and the south have long been a source for social unrest. After the end of the American war in 1975 Vietnam experienced a short period of relative orthodox policies based on a soviet model, before the government embarked on a process of careful small step reforms and embracing full scale liberalisation and free market policies in 1986. These reforms of doi moi remain economic in focus and while there is little official political reform, the economic changes have led to substantial pressures on the political system. In a process of permanent negotiation and re-negotiation state and society in Vietnam are transforming from a fairly statist and centrally controlled society into a more pluralist one with considerable power shifting to individuals and the private sector, while the Communist Party remains the only major political force. In addition, inequalities in economic fortunes have increased both on an individual as well as on a regional level. Although, reforms and changes have been most rapid over the past 20 years, the country has never been a stagnant society, but has permanently acted in anticipation of and reaction to changing political events nationally and internationally.

39 Chapter 4: On-line with the People in Line: Cautious First Steps and Flexible Control

One year after the sixth Party Congress of the VCP, which gave birth the reform process doi moi, Vietnam engaged in its first cooperation with a western telecommunications firm. When Telstra of Australia began this cooperation with the Vietnam Post and Telecommunication Corporation (VNPT), the business arm of the then Department General of Post and Telecommunication (DGPT), in 1987 there were eight international telephone lines going in and out of Vietnam. Four in Ho Chi Minh City and four in Hanoi. If someone wanted to make a call, he or she had to apply several days in advance and the call had to be made from the post office and was limited to three minutes.4 Just a few years before the internet was released from its military and research environment in the United States and increasingly used for non-military and commercial purposes world wide (Castells, 2001, p. 12), Vietnam had virtually no network capabilities. However, within the overall reform process the government created policies that would allow for the development of the sector. At the same time the development of the sector was influenced by various factors that led to a rather inconsistent path. Mai Liem True, a former general director of the Department General of Posts and Telecommunications and later deputy minister of post and telecommunications, points out in an interview with the Vietnam Investment Review that the country was embargoed in the 1980s and early 1990s and international development was thus difficult to achieve. In addition, there was internal opposition to these kinds of reform within the party. Once the cooperation with Telstra proved successful, international cooperation increased (Thu Hang, 2005). Domestically the development of intranets and later the internet in Vietnam was not unlike the development that took place previously in the US. The first international connections were established by the Institute of Information Technology (IOIT) in Hanoi in 1992 through a dial-up connection to the Coombs Computing Unit at the Australian National University (ANU) in Canberra . The institute, which belonged to the National

4 Based on field notes; casual conversation with the resident representative of Telstra in Vietnam in 2003.

40 Centre of Natural Science, was interested in setting up local and wide area networks and followed the development of ARPANet (Advanced Research Projects Agency Network) (Dang Hoang-Giang, 2002, p. 234). ARPANet was created by a relatively small number of researchers mainly in the US and its successful implementation and development is largely attributed to a high level of open cooperation amongst the researchers, extensive freedoms provided to the researchers and public funding (cf. Abbate, 1999; Castells, 2001). In 1993 two country internal networks were set up in Vietnam. The IOIT established VARENet (Vietnam Academic Research and Educational Network), a network intended for use by the country's research community, which was originally connected five times a day to a computer at ANU in Canberra. Through the Canadian organisation Cooperation et la Solidarite (CIDS) a second network, Netnam, was established that served primarily the international community in Vietnam especially foreign Non-Governmental Organisations. In April 1994 Prime Minister, Vo Van Kiet, sent an e-mail to Swedish Prime Minister Carl Bildt (Dang Hoang-Giang, 2002, p. 236; see also Fortier, 1996). Through this act by the Prime Minister e-mailing through networks had become an officially recognised practise, but Vietnam was still far from full connectivity to the internet. The development of these networks were established relatively independent of the direction of the state and its main actor the VCP. Dang Hoang-Giang (2002, p. 243) considers the development of intranets as "some kind of a grass-roots project", while Fortier (1996, p. 30) claims the National Centre for Natural Science had a relatively independent position in the Vietnamese state apparatus. Nonetheless, the very first experiences with electronic networking in Vietnam were limited to two groups of somewhat privileged status, researchers and the foreign community. In spite of the symbolic act by the Prime Minister even government offices were largely off-line. VARENet expanded and included about 1500 collective and 4000 individual users by mid-1998, when Vietnam was in its first year of full (i.e. international) internet connectivity. While 4000 individuals is a small number out of a population of 80 million, the inclusion of individuals signalled a willingness to provide at least some network access outside the institutional realm. At the same time VARENet was limited to the use

41 of e-mailing based on its technology (Unix to Unix CoPy protocols, UUCP). Netnam provided more services, but was limited largely to foreign development organisations, foreign corporate representatives and expatriates living in Hanoi. By 1997 subsribers included a few hundred Vietnamese professionals (Dang Hoang-Giang, 2002, p. 236). After 1994 a few other intranets were set up. Amongst them was a network by the Khanh Hoa Post office of the southern province of Khanh Hoa with its principal city Nha Trang, Vietnam Wisdom by the Financing and Promotion of Technology Corporation (FPT) under the former Ministry of Science, Technology and Environment, VN-Mail by the VNPT subsidiary Vietnam Data Communication Company (VDC), ViNet by the joint venture Batin and VitraNet by the Ministry of Trade (Vietnam Economic Times, 1997a). With the exception of the provincial post office, which may be considered a more local entity but is administratively under the control of the national DGPT, all actors represent a specific community that had an early interest in the development of the internet in Vietnam. It is the mandate of the DGPT and VNPT to develop the sector. In addition, there is the research and technology sector represented by the Ministry of Science, Technology and Environment, there are commercial interests represented by the Ministry of Trade and international business in the form of a joint venture. In spite of the existence of networks in the country and the world wide expansion of the internet, full access to the internet took several more years. The largest of the nets, VN-Mail had established link-up points with other networks and through them the internet in Australia, France, the US and Singapore, but these were limited access services mainly e-mail as well as some file transfers. In 1997 there were about 200 internet connections from the various networks, but no single Internet Exchange Provider (IXP) that would facilitate large data exchanges with the rest of the internet (Vietnam Courier, 1997). It was not until March 20th, 1997 that government Decree 21/CP on new regulations relating to the management, installation and use of the Internet in Vietnam took effect. Only in November of 1997 was the internet fully operational in Vietnam. Given the growth of 'independent' networks and the connections to nodes on foreign territory, the government was given little choice, but to facilitate full internet access to Vietnam. At the same time it seized the opportunity to implement rather stringent regulation of the internet. Especially in the beginning the Vietnamese

42 government has taken very small steps with very limited risks to its own position involved. The steps have become much bigger, but the risk has increased only marginally, if at all.

Full Access

By mid-1995 VNPT recognised the commercial potential of the internet and became highly protective of its monopoly as a data carrier. However, neither VNPT nor the IOIT were allowed to provide general internet access until a decision was reached by the Politburo and the Prime Minister's Office (Dang Hoang-Giang, 2002, p. 238). This decision was Decree 21/CP, which served two purposes for the government. On one level it provided a regulatory environment that allowed full access to the internet and thus boosts investor confidence and facilitates commercial flows for much needed and even moreso desired FDI. On another level the decree was the framework for setting up infrastructure that would allow virtually full control over electronic information flows through various state actors controlled by the VCP. The 1997 piece of legislation required all international connections to go through one of two gateways in Hanoi and Ho Chi Minh City, which were operated by VDC. VDC as a subsidiary of VNPT was under the control of the DGPT, a major actor in the setting up the internet regulation. Control over international data traffic was thus given to the government agency responsible for communications infrastructure and interested in its economic proceeds. Although a pioneer in networking technology in Vietnam neither FPT under the Ministry of Science, Technology and Environment nor IOIC were licensed to provide international connectivity, whereas especially the latter probably did not have the technical resources to do so.

The state did not hide its intention to control internet content and Mai Liem True, general director of the DGPT and deputy chief of the National Internet Board in 1997 confirms this in an interview with the Vietnam Economic Times: "In principle, the government will control the information transmitted" (Vietnam Economic Times, 1997b). In choosing VDC, which was ultimately under the direction, if not control of Mai Liem True, over the somewhat more independently operating organisation from the research

43 sector, the state had a trusted agent in place through which it could monitor its international data traffic and by routing all traffic through two gateways the technological ability to do so. In addition to controlling the gateways, the regulation provided relatively effective control over the internet by holding ISPs, the organisations dealing directly with the end-user, responsible for the content accessed by its users and requiring the ISPs, which had to be licensed by the state, to eliminate inappropriate uses, which include pornography and anti-state material. When decree 21/CP came into effect only three ISPs fulfilled, according to Mai Liem True, the "technical" requirements to provide internet service. These were VNPT, the Saigon Post and Telecom Services joint stock company and Viettel, the Army telecommunications electronics company. FPT was not on Mai Liem Truc's list, but became one of four ISPs early on (Tu Giang, 2001b; Vietnam Courier, 1997; Vietnam Economic Times, 1997b, 1997c, 1997d, 1997e). The Vietnam Economic Times refers to a power struggle between DGPT and the National Centre of Natural Sciences and Technology, which includes pioneer IOIT, over the control over the internet in April 1997 (Vietnam Economic Times, 1997c), which appears to have been won by the technocratic providers of infrastructure rather than the creative minds that pioneered network technology in Vietnam. The control over internet content was further enhanced by requiring Internet Content Providers (ICPs), i.e. organisations hosting web• sites or other content as e.g. file transfer protocol sites, to keep their servers in Vietnam and receive a licence for hosting such services. In addition to the DGPT and the Ministry of Science, Technology and Environment decree 21/CP brings two other major actors into the internet regime. The Ministry of Information and Culture is responsible for establishing guidelines regarding appropriate content on the internet and licensing ICPs and the Ministry of the Interior is effectively responsible for policing the net and implementing adequate technology to do so. The DGPT's task is to provide adequate infrastructure, while the Ministry of Science, Technology and Environment is responsible for research and development. The timeframe of establishing the internet in Vietnam and the resulting power sharing arrangement between four major ministries or departments reflects the considerable internal division of the party and the insecurity of the state. For three years

44 after the Prime Minister sent his first e-mail neither VNPT nor IOIT, both organisations within the state apparatus, were allowed to provide full internet connectivity. Development was practically put on hold, while the Politburo and the Prime Minister's Office engaged in consultations. Gabriel Kolko (1997, pp. 80-81) describes growing opposition in the period between the sixth and the eighth Party Congress by Party members who remain deeply committed to revolutionary and socialist ideals and view the reform process as a wholesale rejection of these ideals. The development of the internet may have been viewed by these factions, which included many members of the army and veterans fighting in several wars for the revolutionary cause, as part of a further integration in the capitalist west. Such struggles may have greatly influenced the discourse around national security and social evils, which I will discuss in greater detail later, and may be part of the reasons why the Ministry of the Interior, essentially responsible for policing the internet, and the Ministry of Information and Culture, responsible for content, received a relatively strong role. While the regulation strengthens the role of the state politically, it is also a considerable success for the reformers, because commercial use of the internet is virtually not restricted. At the same time the Politburo and the Prime Minister's Office distributed the control over the internet over enough trusted agencies to avoid potentially destructive power accumulation in a single agency and thus secured political control over the net by the party, especially the Politburo and the Prime Minister's Office, while maintaining commercial openness.

Consolidation of Legislation and Infrastructure

A major step in the development of the internet in Vietnam was Decree 55/2001/ND-CP (see Socialist Republic of Vietnam, 2001) on The Management, Provision and Use of Internet Services in August 2001, which replaced the 1997 provisional Decree 21/CP that had been the legal framework for the internet for four years. The new regulation was an important step in the development of the internet, because of its partial liberalisation of the internet market on one side and its more stringent emphasis on government management and licensing requirements on the other.

45 Since 1997 the state has been under pressure by the business community and consumers to provide cheaper and better internet access (Tu Giang, 2001b), and the legal changes would allow the DGPT to licence more ISPs and IXPs, a term used in the new decree for internet gateways, which were formerly the monopoly of VDC. VDC also owned all transmission lines, which other ISPs had to lease from it. In May 2002 FPT and the army owned company Viettel were licensed as additional IXPs (Hong Ha, 2002). In February 2002 licenses for five new ISPs were granted, of which one licencee is a private ISP and can thus provide services only to a limited constituency, such as member organisations of the organisation or for example a business park (Vietnam Investment Review, 2002).

In spite of the increased competition, which was intended to introduce greater (although limited) market principles and lower prices for internet use, the state had to give up little of its control over the net. Ownership of network infrastructure is hierarchically organised. IXPs must be state owned or joint stock companies that are dominated by the state. ISPs can be enterprises of all economic sectors and provide internet access to organisations and individuals, while private ISPs can only provide internet access to member organisations and are not allowed to make a profit. As shown in Figure 4.1 IXPs are the only ones that are allowed to provide connections to internet nodes outside Vietnam, i.e. the international internet. ISPs are allowed to connect to other ISPs and to IXPs, but private ISPs are only allowed to connect to ISPs and IXPs. Private ISPs are not allowed to directly interconnect. Consumers can receive internet services from Vietnamese ISPs, but not private ISPs. It is also not allowed to connect to an international ISP by direct international dialling (Socialist Republic of Vietnam, 2001).

46 Figure 4.1: Legal and Illegal Connections in the Vietnamese Internet Structure

International Internet (World)

Vietnam

IXP

ISP

Private ISP _ _ J

Limited User Limited User Community Community

Consumers / End Users

Illegal Connection

Legal Connection

Source: Own graphic.

47 By 2002 there were only three IXPs, nine ISPs and one private ISP. Since all three IXPs also act as ISPs, there are only nine organisations in the country that provide nodes through which internet traffic can be routed. There are only three that route international traffic. Although highly regulated and somewhat oligopolistic these numbers are probably large enough to operate the internet economically by market principles, but leave the authorities with not too many organisations to control data flows, if necessary. Aside from maintaining political control with limited market principles, the high level of state ownership also bears the characteristics of what Chalmers Johnson described as the "developmental state" (e.g. 1995), a state that achieves high economic growth through strong planning by state institutions especially in industries that are in early development stages rather than through open market principles and high competition. The Vietnam Internet Network Information Center (2003) reports that there were five IXPs in Vietnam in 2003, all of which provide international connections. However, as Table 4.1 shows, VNPT controlled by the Ministry of Post and Telecommunications (MPT), the successor of the previous DGPT, has with approximately 87 percent or 905 Mbps (Megabytes per second) the by far largest share in international bandwidth and connections to the largest number of nodes. The army company Viettel has connections to four nodes of international networks, but only 38 Mbps bandwidth. FPT has a higher bandwidth, but only a single connection to one international network. The remaining two companies have a combined bandwidth of 6 Mbps or 0.6 percent of the total bandwidth and two connections. The increase of licences for IXPs is another small step in liberalising the internet market, but the control of the network and its flows remain with the organisation that had a monopoly position since the government began to legislate the internet in 1997. The pioneers of the internet in Vietnam, the relatively independent IOIT and Netnam, are not providing services anymore.

48 Table 4.1: International Bandwidth by IXP IXP - ISP Connection Bandwidth Total KORNET (KOREA) 2 Mbps SINGTEL (SINGAPORE) 310 Mbps REACH (HONGKONG) 290 Mbps VNPT KDD (JAPAN) 2 Mbps 905 Mbps CHINA TELECOM (CHINA) 155 Mbps FUSION (USA) 145 Mbps TRUNGHOATELECOM (TAIWAN) 1 Mbps DACOM (HONGKONG) 2 Mbps SINGTEL (SINGAPORE) 4 Mbps VIETEL 38 Mbps REACH (HONGKONG) 2 Mbps INTELSAT (USA) 30 Mbps FPT REACH (HONGKONG) 89 Mbps 89 Mbps ETC KORNET (KOREA) 2 Mbps 2 Mbps SPT REACH (HONGKONG) 4 Mbps 4 Mbps Total 1038 Mbps Source: Vietnam Internet Network Information Center, 2003.

Four government ministries remain primarily responsible for the control and management of the internet, although decree 55/2001/ND-CP also mentions explicitly a fifth ministry, the Ministry of Finance as the responsible body for decisions on fiscal assistance, which gives priority to Party and state agencies in terms of the allocation of investment capital and application of financial assistance. The Ministry of Post and Telecommunications (former DGPT) is mainly responsible for infrastructure. The Ministry of Science, Technology and Environment is responsible for research and technology development related to the internet. The Ministry of Culture and Information manages the content of the internet in Vietnam and the Ministry of Public Security is responsible for the "safety" of internet activities, including "national safety".

Internet Content

Although the internet is global in reach and Vietnam is fully connected to the internet, all information has to be routed through at least one IXP of only five organisations, as described above. It is thus relatively easy to block content that originates from a server outside Vietnam. The British Broadcasting Corporation (BBC) reported in November 2002 that ISPs confirmed that authorities have blocked access to the Vietnamese language pages of its web-site. The BBC reported the news in connection

49 with a report on the detention of dissidents in Vietnam (BBC News, 2002). The organisation Reporters Without Borders reports that the "government blocks access to websites it considers politically and morally 'dangerous,' including foreign news sites and those of human rights organisations set up by Vietnamese abroad" (Reporters Without Border, 2003, p. 133). Many of the "human rights organisations" the report refers to are organisations set up by groups of overseas Vietnamese that left Vietnam, especially South Vietnam, after the end of the American war and were often-affiliated with the Saigon administration, which can hardly be considered a defender of human rights. Many of these sites are based in the United States, which has fought a destructive war against Vietnam and its current regime, which led the North Vietnamese army in the American war. Between 2002 and 2004 and presumably at other times as well, it was possible to access the site of Amnesty International and western media from Vietnam.5 Content that is originating from servers outside Vietnam can be and is blocked by Vietnamese authorities, but the content of foreign sites as such cannot be controlled by the authorities. There is, however, an attempt to control content that originates from servers within Vietnam. In addition, Vietnamese content can be blocked, although not at the IXP level, over which the state has greatest control and of which there are fewest, but at the ISP level, which can be interconnected within Vietnam. According to Decree 55/2001/ND-CP organisations that provide internet content, most likely in the form of web-site hosting, require a licence from the Ministry of Culture and Information. The licensing process is in place and there are fines for providing content without a licence or breaking the conditions stipulated in the license. This provides the state with a dual strategy for controlling domestically created internet content. Specific internet addresses can be blocked at the ISP level under the overall supervision of the MPT and content should be approved by the Ministry of Information and Culture prior to being uploaded. On a generic level information circulated on the internet must comply with the Press Law, Publication Law, Ordinance on the Protection of State Secrets and other regulations. While the government promotes the use of the internet for news publishing,

51 have lived in Vietnam during this period, using dial-up internet service through pre-paid cards from VDC or FPT and was able to access such sites.

50 it attempts to maintain strict control over the 73 e-newspapers that it has licensed between 1997 and 2005. In consultation with the Central Ideology and Cultural Committee the Ministry of Information and Culture will set standards on content for editors-in-chief of e-newspapers (Vietnam News Brief Service, 2004e), thus employing the same mechanisms as for printed newspapers. It is expected from electronic news outlets that these will support a government set agenda, as the following announcement at a conference on e-newspapers in central Hue City in October 2005 by Hong Vinh, member of the Party Central Committee and deputy head of the committee's Ideological and Cultural Commission illustrates: "These newspapers have to stick to the Party and country's political tasks, promote the patriotic emulation movement and help the country fulfill socio-economic development tasks" (Vietnam News Brief Service, 2005e). A major concern for the government of Vietnam is the existence of "social evils" in the country. The term is used generically for drug abuse, gambling, prostitution and pornography. While social evils are condemned regularly by high ranking officials and police actions against establishments hosting any activities related to social evils are well publicised, there is little indication in the Vietnamese Press that such social evils are declining. A major challenge is the inability of the state to control local authorities and complex networks of business-authority relations facilitate the distribution of pornography, prostitution, gambling and drug abuse through corruption and cover-ups (see e.g. Koh, 2001a). The rise of social evils is often associated with the open door policy since doi moi and attributed to negative western influences (see Gainsborough, 2003, p. 151). Interwoven into the theme of social evils is a greater discourse on morals in general and traditional Vietnamese values. The internet is often identified as a major threat to these values and Decree 55/2001/ND-CP (Article 3.1) states that the management of the internet must be implemented in a way that prevents abuses that have a negative impact on national security, national morality and traditional fine customs. While these terms leave a great deal of room for interpretation, there is generally a shift in government policy towards bourgeois values of nuclear families and individual responsibilities. Nuclear families are now re-constructed as units of traditional Vietnamese values, marking a shift from the official promotion of a more gender

51 egalitarian, modern and non-traditional society under ideological influence during the period of creating a socialist Vietnam (Drummond, 2000, p. 2385). In 2004 the Ministry of Culture and Information decided to coordinate with the MoPT and the Ministry of the Police (MoP) to regularly conduct surveillance of internet content. In September 2005 the Vietnam News Agency reported that ISPs in Vietnam "are likely to have network security software installed free-of-charge to prevent users from accessing harmful websites", relying on a statement by Nguyen Tu Quang, director of the Internetwork Security Centre at the Ha Noi University of Technology. The software will provide ISPs with the possibility to circulate "domain names of unhealthy websites" to the centre. Once a site is approved harmful it will be made inaccessible (Vietnam News Agency, 2005a).

The Internet Panopticon

Although the state maintains considerable direct control over the network infrastructure, it also downloads the responsibility for monitoring and policing the data flow on the internet in Vietnam to other organisations and individuals. Article 6.2 of Decree 55/2001/ND-CP states that "[organizations, individuals providing and using Internet services are responsible for information accessed, transmitted on the Internet". On one level this clause puts the burden of "responsible use" of the internet on the individual user, but it also puts responsibility on ISPs, which are the providers of any service. Fines of various ranges can be levied against individuals and organisations that break administrative rules related to internet provision and use that do not constitute a criminal responsibility. The highest fines are for providing internet service without a licence or providing internet service contrary to the terms stipulated in a licence. The enforcement of penalties will be carried out by "[specialized Inspectors and Peoples' Committee [sic] at all levels". This suggests that the state is not intending to - and most likely would not be able to - control all data flows on the internet. However, various state agencies and inspectors can selectively exercise control over data flows on the basis of a

52 decree issued by the highest decision making organs in the state structure, the Prime Minister's Office and the Politburo. Given the possibility for fines and more importantly losing the licence to a lucrative business, ISPs have a vested self-interest to act within the regulations set out by the state and thus monitor internet traffic. More importantly "Internet abuse to oppose the Socialist Republic of Vietnam and perturb safety and security and other serious violations" (Article 45) are criminal responsibility. While most internet traffic does not appear to be permanently monitored, the state exercises considerable power. An inspection of internet cafes in 2002 showed that most of the computers stored the addresses of web-sites on a "black list". (Vietnam News Brief Service, 2002b)

Following Foucault's (1995) notion of the panopticon, users and providers may well be engaging in acts of self-censorship. Just as the architecture of the modern prison described by Foucault gives the prison warden the potential to observe the inmates at any time without them knowing, if they are actually being watched or not, the architecture of the internet in Vietnam gives the Vietnamese state the potential to monitor internet traffic at any time, without internet users or providers knowing when this is occurring.

The Micro Spaces of Internet Diffusion and Control

The setting up of internet cafes during the first year of Internet connectivity to Vietnam was ambiguous, not only because it was a new field of business and prices were high, but also because the legal basis for cyber cafes was uncertain. The first internet cafe in Ho Chi Minh City was closed by authorities based on allegations that "contaminated" e-mails were sent from there, but in early 1998 other cafes opened in the southern city and there were at least two in Hanoi (Do Anh Ha, 1998). By 2004 there were about 4000 Internet cafe owners in Vietnam and the free access to information and the lack of control over these spaces became a major concern for the government, which pushed for increasing control. The discourse surrounding the debate on greater control of the internet was dominated by government statements on social evils. In a 2004 interview the deputy head of the investigation department of the Ministry of Information and Culture Vu Xuan Thanh, for example, explained: "It goes

53 against the good morals of Vietnamese if we allow our young people to view sexual web sites." Controlling the internet is difficult, because of unclear regulations and a lack of staff and equipment. Vu Xuan Thanh noted, however, that in China, for instance, internet cafes are linked to a central agency, where the government monitors content and access and can "manage each subscriber" (Vietnam Investment Review, 2004). Since these concerns became more serious, a first step towards greater control was a legally binding instruction in August 2004 by the Ministry of Information and Culture that internet cafe owners must provide a list of all web-sites visited in their cafes over the previous 30 days, if the Ministry requests such a list. Moreover, the cafe owners must also provide credit card or ID card numbers of the customers that accessed such sites. In addition, fines for internet cafe owners for hosting inappropriate web-sites was increased from 20 to 30 million VND (approximately 1,900 USD at the time) (Vietnam Investment Review, 2004). These regulations were included in an inter-ministerial circular by the Ministry of Public Security, Ministry of Post and Telematics and the Ministry of Information and Culture in October 2004, and additional detail was added. The circular took effect in July 2005, when the group of ministries involved had been extended to include the powerful Ministry for Planning and Investment, which is responsible for attracting FDI, but had not previously been given any jurisdiction over the internet. The circular was designed to aid the implementation of government Decree 55/2001/ND-CP. The circular attempts to prevent the access to "inappropriate" sites in internet cafes in two major ways. First, there are minimum space requirements set for each computer and each terminal must be in the internet cafe owner's view, thus the shop owners act as a control person in the micro geographic space of the cafe. In addition, opening hours are set for the time between 6:00 AM and midnight and children under the age of 14 must be accompanied by an adult (Hai Van, 2004; Vietnam News Brief Service, 20051; Vietnam News, 2005; Vietnam Investment Review, 2005b). The resemblance between Foucault's (1995) description of the modern prison, where each inmate is within the warden's view at any time, and the regulation of the internet cafes, where each terminal must be within the owner's view at any time, is obvious and the internet panopticon is aided by the more traditional panopticon of physical space. However, the second form of control is a technical one.

54 Internet agencies and cafes are required to install software that tracks customers' names and ID numbers. The software is to be provided by the ISPs (Hai Van, 2004). Through these measures the state has downloaded the responsibility for monitoring the internet to another level below the ISP in an attempt to effectively control all information. A critical point for the central government in the implementation of the inter- ministerial circular could be the reliance on provincial authorities for enforcement. Insubordination of local authorities weakens the effectiveness of Vietnam's state management (Koh, 2001a, 2001b) and thus provides room for unauthorised use of the internet. The deputy head of the investigation department of the Ministry of Information and Culture Vu Xuan Thanh identified this phenomenon as a challenge in the control of access to "inappropriate" web-sites less than a year before the circular took effect: "[Local authorities] are the most important sector to the success of this campaign. But, they don't care much about the problem at the moment" (Vietnam Investment Review, 2004). While the internet can be policed effectively by the state, the implementation thereof depends on human actors, which are all integrated into the wider network of the state apparatus in various ways and have diverse individual interests and motivations. State influence over the internet can thus never result in total control. Local insubordination and corruption is illustrated by the detection of an internet cafe that provided virtually permanent access to porn movies for clients including many children as young as ten. The cafe was found in the southern city of Bien Hoa in Dong Nai province adjacent to Ho Chi Minh City, but the operation was led by the General Police Department in Hanoi, which acted after local residents had lost confidence in local authorities and petitioned higher levels of government. The owner of the cafe was the wife of the head of the provincial police unit specialising in the fight against "social evils" (Vietnam News Brief Service, 2005i, 2005j). According to police records between 1995 and 1998 two thirds of known customers in the sex industry were government officials (McNally, 2003, p. 116). In another move in June 2005 the People's Committee in Hanoi has explicitly given permission to mass media in the city to publish names and position of people found guilty of drug use or prostitution. According to Hanoi's Mayor Nguyen Quoc Trieun the move is intended to scare people (Ngoc Anh, 2005). In this case the media are

55 encouraged to support the state's agenda and are likely to fulfil this role, because of the sensational connotation of drugs and prostitution, while on other topics reporting is restricted or discouraged as discussed in chapter 3.

Social Evils or Political Control?

While prostitution, drug abuse and gambling, i.e. social evils, are certainly existing problems with high social costs, the government's response appears ineffective. Kolko claims that high levels of prostitution are the result of economic liberalisation and the erosion of any effective government social networks. "In 1996 there were more prostitutes in Ho Chi Minh City than at the peak of the [American] war" (1997, p. 108). The level of prostitution remains high and is a visible feature of cities and towns (cf. McNally, 2003). There is legitimate concern that the internet provides a means to distribute and promote pornographic materials and prostitution. Internet chat rooms, for example, are used by prostitutes to make initial contact with potential clients and private "VIP" rooms with web-cameras and head-sets in internet cafes are popular with some females who seek an income in the sex trade (Vietnam News Brief Service, 2004c, 2004d). However, cyber space is likely only a small part of the sex trade and prostitution is taking place in more traditional spaces such as Karaoke shops, hotels, bars, night clubs, massage parlours, hair salons, public parks, streets and back alleys (cf. Koh, 2001a; McNally, 2003). Another major concern, and one that warrants the attention of the authorities, is political material circulated on the internet. Decree 55/2001/ND-CP states in Article 11 (3) that it "shall be strictly prohibited [... to ...] Take advantages of the Internet to do hostile actions against the Socialist Republic of Vietnam or cause security unrest, violate morality and good customs and other laws and regulations." The state has created a legal basis to take action against political activity on the internet, if it is deemed to be violating this clause. However, the wording is vague and open to interpretation, while there appears to be no additional clarifying instruction or regulation by a specific ministry or the Prime Minister's Office.

56 In December 2002 the Minister of Information and Culture and member of the VCP's Central Committee, Pham Quang Nghi, defended in a newspaper article the monopoly on political power by the VCP arguing for the "implementation of real democracy in Vietnam under the leadership of the VCP" (Vietnam News Brief Service, 2002a). The article reaffirms a policy of allowing open debates on particular issues without undermining the dominant position of the party (see chapter 3). The Vietnamese state still reacts with its full force, if it considers the dominance of the party threatened, especially if foreign organisations and overseas Vietnamese groups are involved in any actions. Nghi's article came less than a month after a Hanoi court sentenced dissident Le Chi Quang to four years in prison for distributing anti-state documents on the internet, without revealing the content of the documents (Vietnam News Brief Service, 2002a, 2003c). Another month later Nguyen Khac Toan, a former military officer, was sentenced to twelve years in prison and subsequent three years probation by a Hanoi court for espionage. Toan had sent 24 e-mails and two floppy disks to an overseas group. He also used his cell phone to transmit information (Vietnam News Brief Service, 2003b, 2003c). In March 2003 Ho Chi Minh City physician, Nguyen Dan Que, was arrested for sending documents with content that "runs against the state" to the US-based "High Tide Humanist Movement" from an Internet Cafe. The original charges against him under the criminal code could have carried between twelve years imprisonment and the death penalty (Vietnam News Brief Service, 2003c). He was convicted of undermining the state and sentenced to two and a half years in prison by the Ho Chi Minh City people's court more than a year later (Vietnam News Brief Service, 2004a). In yet another case a Hanoi court sentenced Pham Hong Son to 13 years in prison for distribution of "false" information about the Vietnamese government on the internet. Again the case was linked to organisations of exiled Vietnamese activists (Vietnam News Brief Service, 2003b). Son's term was later reduced to five years (Vietnam News Brief Service, 2003a). Vietnam regularly grants mass amnesties to prisoners and dissidents have been amongst those released in the past. The arrests and convictions of dissidents that used the internet for their activities happened only about a year before the Ministry of Information and Culture in cooperation with other ministries tightened the controls over the internet through

57 additional instructions, regulations and circulars. While these regulations were generally framed as pieces of legislation to prevent "social evils", they will certainly be useful for tracking dissidents that are using the internet for their purposes. The state reacts with its greatest force in form of persistent prosecution and long prison terms, especially if foreign organisations are involved. It also reacts to the emergence of domestic debates and criticism, if these are not authorised. In 2002 for example the Ministry of Information and Culture closed down a popular web-site that served as an on-line discussion forum for young people. The site had almost 60 000 registered members. The site was closed down, because, according to the ministry, it had not obtained a license and some of the published information was inaccurate. The large membership of the site and its existence as such suggests that independence in cyberspace is either consciously but quietly granted or simply not recognised by the authorities and suggests that there are opportunities for subverting panoptical strategies by the state. However, the state authorities react, if the matter becomes serious to them. The decree of freedom for explicit or implicit political acts in cyberspace is similar to that in physical space. While there is more activity in public space today than in the early 1980s (Drummond, 2001, p. 2382) and the authorities tolerate some degree of crowd formations in public space, large crowds, as for example around football (soccer) matches or other events of popular culture, have become a major concern for the state, which will act to disperse these crowds, if it considers it necessary. There have even been reports of massing of army personal in city barracks before the 1998 football world cup final (Thomas, 2001, pp. 310-311). Just as in physical space, state authorities have a degree of tolerance in cyberspace, but act if considered necessary. While the Vietnamese state reacts with its state power when it is under threat, especially from outside sources, it carefully intertwines such actions with a discourse on social evils to justify control mechanisms and force. The Vietnamese state thus follows a long standing practice in western liberal democracies, where the state restricts basic rights and freedoms and imposes controls on its population to maintain its internal and external stability. The practice of McCarthyism in the United States of the 1950s, the imposition of Berufsverbote (prohibition to exercise one's occupation) for West German civil servants, especially teachers in the 1970s or the indefinite detention without charges

58 of individuals under so called security certificates in Canada and the detention of individuals without charges in Guantanamo Bay by the United States in the first decade of the 21st century are examples of western countries undermining the constitutional state under the discourse of the threat of communism and terrorism. Relying on its power position and quasi monopoly on political power the state has undermined the basis in the modern state for Habennas's establishment of a radical discourse. This applies to the Vietnamese state as well as the western states.

State Sanctioned and Sponsored Information and Internet Uses

While the promotion of social evils and unauthorised political information are normatively restricted on the internet in Vietnam, political information by the Party and the state are specifically encouraged internet uses. Decree 55/2001/ND-CP explicitly states in Article 4 that:

Scientific research, education, training, health care, software development institutions and organizations, Party and State agencies shall be prioritized in terms of the allocation of investment capital and application of financial assistance regarding the provision and use of Internet services.

Article 5 states the following:

Encourage to publish information in Vietnamese, especially information related to Party's directions and policies, State's law on the Internet and create favorable conditions for organizations and individuals, through Internet, to introduce their products and/or services [sic].

Party and state are on the list of institutions that should be prioritised for investment, a decision that confirms the policy of maintaining the monopoly on political power by the party. In addition, publication of state and party information is explicitly encouraged by the decree. While such a regulatory framework in a state, where the Communist Party is constitutionally the leading political power, should be expected, the decree also suggests that the internet is an integral part in the transformation to a market economy and the protection of private property. The promotion of products and services by individuals and

59 organisation on the internet as supported by Article 5 illustrates how the internet is part of the shift from a centrally planned economy to a market system. Moreover, Article 3(2) states that the internet should be developed to "meet the needs of national modernization and industrialization". Article 24 explicitly declares the internet a tool for international economic integration:

The State make appropriate policies to facilitate IXPs, ISPs to step by step reduce charge of [sic] Internet access and exchange service to the level equal to or lower than the average in the region to universalize Internet in Vietnam and improve competitiveness of Vietnamese enterprises in international economic integration. ,

The use of the internet for commercial purposes and regional economic integration began in earnest around 2001, when several ministries and government agencies, amongst them the Ministries of Trade, Justice, Science, Technology and Environment and the DGPT, prepared a decree on facilitating e-commerce. This was an addition to Decree 55/2001/ND-CP and was a requirement under an e-ASEAN Framework Agreement. The vice director of the Department of Trade Promotion under the Ministry of Trade, Nguyen Huu Anh, admitted at the time that the government faced difficulties in drafting the decree, because e-commerce was a new concept in Vietnam (Tu Giang, 2001a). Two years later, the government was still working on a draft decree to promote e-commerce (Van Anh, 2003). E-commerce was rising by 2005, but the country still did not have any laws regulating electronic transactions. A situation on which Deputy Minister of Trade Le Danh Vinh commented as follows: "E-commerce is a relatively new concept for the government, business people and citizens in Vietnam. As the country's economy is in the midst of global integration, a development strategy and laws to govern e-commerce activities are now more necessary than ever." He rephrased the statement, suggesting that global integration is inevitable: "So, creating a stable legal environment and promoting the development of e-commerce in Vietnam is one of the most important tasks to ensure the country's smooth integration into the global trade community" (Duong Nguyen, 2005). Although the establishment of regulations for e-commerce was a slow process, and possibly a result of an inefficient administration or internal disputes, the entering into

60 the e-Asean Framework Agreement and the emphasis on global integration by the Deputy Minister of Trade suggest a relatively high importance of electronic commerce and the use of the internet for these purposes for the Vietnamese government. The Ministry of Trade states that by 2005 the country had 17 500 corporate web-sites and there were already a number of initiatives, where the internet facilitated commerce, even if these were not fully integrated systems with services such as on-line payments and order forms (Vietnam News Brief Service, 2005h). During the first auction of state-owned enterprises in Ho Chi Minh City in 2003 the internet was hailed as an important part in the trading process. "Our centre has the necessary computer equipment and Internet connection to brokering houses, so people would be able to bid for shares even if they were sitting in a stock broker's office. With the support of authorised payment banks, handling the sums of money would be smooth, simple and safe," said Tran Dac Sinh, director of the Ho Chi Minh City Securities Trading Centre, where the shares are being offered (Hong Duong, 2003). The Ho Chi Minh City Securities Trading Centre was established in July 2000 to function as a quasi stock exchange in Vietnam, prior to establishing a full exchange (cf. Klump & Gottwald, 2002). The internet is also starting to play a greater role in real estate trading as the DMC Group Hanoi, for instance, started a virtual on-line trading floor in March 2005, providing consultancy on real estate investment, business, transfer and lease as well as banking-related services with price updates and property information aided by a Geographic Information System (GIS) (Vietnam News Agency, 2005f). Similarly, the Asia Commercial Bank operates real estate trading floors in Ho Chi Minh City and Hanoi, which provide services, such as home banking, Internet and phone banking, card services, international payment transactions and express money delivery, which are highly dependent on modern ICTs and networks (Vietnam News Agency, 2005c). The banking sector has equally developed its range of services offered on-line. Since August 2005 the Vietnamese East Asian Bank, for instance offered internet banking services and many other banks are starting to offer ICT based services (Vietnam News Brief Service, 2005g). Automated Teller Machines (ATMs) are widely available in many parts of the country since 2003 and by 2005 there were 1100 ATMs nation wide (Vietnam News Brief Service, 2005d). Some services, such as paying telephone bills, are

61 offered through the bank machines. The banks have fonned international partnerships, for instance with the China Union Pay, so that clients of both banks can access ATMs with their bank cards in both countries. Vietnam's political mass organisations are also integrated into the ATM business, as students can register for East Asian Bank cards through the communist youth leagues at their schools (Nguyen Hong, 2005).

In addition to using the. internet for commercial purposes, the state itself is eager to utilise the network for administrative purposes. The port cities of Hai Phong and Ho Chi Minh City, for example, offer electronic custom paper fding over the internet and the Ministry of Construction is planning to give out permits on-line, while many other authorities are planning e-government initiatives (Vietnam News Brief Service, 2005f; Vietnam News Agency, 2005e). Although government services on the internet are in their infancy, the government is planning to have a fully integrated country wide network by 2010, with initial deployment at the central level of government. On the other hand, it appears that e-mail is not even widely used in government offices, as an official at the Ministry of Industry reported that they should start training civil servants in the use of e- mail (Trang Anh, 2005). Nonetheless, even if development is slow, the state is highly supportive of e-government and e-commerce initiatives.

Power and Manipulation

Considering the low network capabilities in 1987 the development of the internet in Vietnam was rapid. However, this development was also a process of carefully authorised steps that ensured political control over it by the party and the state. Initially the central organs of both state and party were slow to react to initiatives taken by the research community and international non-governmental organisations. When full access to the internet was finally facilitated per decree in 1997, the state had established a regulatory environment through which it would gain full control over the network and the information transmitted, after quasi independent networks with international connections had emerged earlier. The 1997 decree enabled the state to firewall the entire country to specific information, if deemed necessary. The authority over the internet was dispersed over four ministries within the public administration, thus spreading the control over this

62 powerful infrastructure over trusted, but organisationally different, government bodies. Moreover, control was transferred from relatively independent researchers to line ministries. With the growth of the internet, the state implemented legislation that would download responsibility for controlling the internet to Internet Service Providers and internet cafe owners. It justified measures for controlling internet content with a discourse on the prevention of social evils and the protection of traditional Vietnamese customs. At the same time the state took decisive action against dissidents distributing political information over the internet, while supporting commercial and administrative uses. There is nominally free access to information on the internet, but there are also several mechanisms that enable the state to implement controls and censor information. These include firewalls and licences for hosting content on the web. While such measures are obstacles to creating Habermas's radical discourse, the party has allowed considerable debate and openness on certain issues, including some issues involving state policy, so that the definition of Vietnam as a fully state controlled society, as for example given by the United States State Department, is inaccurate (cf. chapter 3). The Vietnamese state is comprised of many actors and organisations and some are acting rather independently. However, while some independence is granted and probably appreciated, because it frees creative potential for socio-economic development, the state retains a number of control mechanisms through its regulations, which take the form of Foucault's panopticon with respect to the internet. The state can monitor activities on the internet and act, if it considers action necessary. State authorities have acted most decisively, when the state was considered under threat, as for example through the political actions of dissidents, especially those with extra-territorial connections outside the sovereignty of the Vietnamese state. However, the need for internet control is primarily framed in a discourse of social evils, which so far seem to have been only poorly contained. Considering the decisive action against dissidents and the lax fight against prostitution, drug abuse and gambling, the creation of a discourse on social evils by the state, should be considered covert strategic action rather than an ethical discourse (Klein & Huynh, 2004, p. 187). According to Habermas this would be a case of "systematically distorted communication" (Habermas,

63 1982, p. 264 cited in Klein & Huynh, 2004, p. 187). State authorities are in a position to engage in this covert strategic action, because of their power position and more directly, because of the regulatory environment and laws created around the internet in Vietnam. Ironically Habermas uses the law as an example of how modern society can overcome the power relations described by Foucault, while the law in this case is the mechanism that allows the state to engage in its strategic actions. At the same time this power is not absolute, since the state will have to react to gross misconduct of its own authorities, as in the case of the protection of an internet porn cafe by local police has shown in a more specific instance or the establishment of independent networks in more general terms. Thus the permanent pressures applied by various actors in the state on other actors in the state ensures some limited pluralism and a more radical discourse than in a society of monolithic statism. Moreover, a free market economy and international economic integration are specifically encouraged and supported by the state, in part through the use of the internet. Most importantly the state is supportive of e-commerce and e-government initiatives, including for the efficient facilitation of trade (e-customs) and property development (Ministry of Construction permits). The internet is used for real estate trading and the equitisation of state owned enterprises. Such policies reduce the power and influence of the state without democratisation through the transfer of control over capital and natural resources, including land and state owned enterprises, to private property owners and thus creating a new bourgeoisie. In its evolution from feudal society the bourgeois free market presents itself as a sphere free from outside power (herrschaftsfrei) and controlled only by its self-regulating mechanisms (Habermas, 1982, p. 101). However, as Kolko (1997, pp. 92-95; cf. chapter 3) suggests public property in Vietnam was redistributed by those individuals in the state that were in the power position to do so, i.e. the Communist cadres, who gave preference to their families and accomplices. Thus the liberalisation process in Vietnam has created a society that is not free from outside power. Power was instead maintained by those elements in the state that already had power and influence, but was moved outside the realm of the state. The gap between rich and poor is widening (Asian Development Bank et al., 2003, p. 13; cf. chapter 3), likely a result of these policies. This process is supported by the internet, because commerce and gaining access

64 to capital are explicitly encouraged, while open debate is limited. Thus the internet project in Vietnam is part and parcel of establishing a bourgeois society, in which the communist cadres and new entrepreneurial elites control a public discourse that protects private property and facilitates commerce above all else.

65 Chapter 5: Uneven Geographies

The system of flexible control explored in the previous chapter is an important mechanism for the Vietnamese government to maintain its monopoly on political power. In addition, economic conditions regulate access to the internet through pricing and conditions in the countryside are very different from those in the cities. This chapter explores the pricing structure of the internet, wealth distribution and regional socio• economic variations. It also examines the policy preferences and level of influence of actors in the public and in the private sectors, while placing Vietnam in the global internet geography and world system, by exploring examples of internet applications and the country's ambitions as an investor in neighbouring countries.

An Urban Technology

The diffusion of the internet in Vietnam was a relatively slow process, especially during the first few years after its official endorsement by the government in 1997. By 2002 less than a quarter of a percent of the population were subscribing to the internet (Lam, Boymal & Martin, 2004, p. 47) although the number of overall users through internet cafes and other points of access, such as friends, relatives or offices was likely higher. Table 5.1 shows a very low starting point of 3092 subscribers in February 1998 shortly after the official inception of the internet. Within the first year the number increased more than five times to 17 000 in January 1999 and the numbers approximately doubled on an annual basis until 2006, when there were about 3.6 million subscribers. Although the number of subscribers is an important indicator on the technological diffusion, the number of internet users provides a better indication of the use of the internet in society. By June 2006 close to 16 percent of the population used the internet, which is up from 2.25 percent three years earlier. Overall the growth of the internet has been quite substantial in Vietnam, but given a late start the internet is not widely used yet in a country with a very young population.

66 Table 5.1: Internet Use in Vietnam 1997 - 2006 Internet Subscribers Internet Users Date Total %* Total % June 2006 3 612 178 4.35 13 157 052 15.83 December 2005 2 906 422 3.50 10 710 980 12.9 June 2005 1 987 964 2.41 7 496 378 9.09 December 2004 1 659 013 2.01 6 345 049 7.69 June 2004 1 228 450 1.51 4 708 909 5.78 December 2003 822 908 1.01 3 332 432 4.09 May 2003 449 959 0.56 1 799 836 2.25 Early 2002 200 000 0.25 September 2001 180 000 0.23 September 1999 35 148 0.05 January 1999 17 000 0.02 December 1998 10 000 0.01 February 1998 3092 0.00 Source: June 2004 - June 2006: Trung Tarn Internet Viet Nam, 2006; May 2003 - December 2003: Vietnam Internet Network Information Center, 2003; Early 2002: Vietnam News Brief Service, 2002b; September 2001: Vietnam News Brief Service, 2001; September 1999 & February 1998: Lam, Boymal & Martin, 2004; December 1998: Vietnam Investment Review, 1998. * For 2003 - 2006 calculated using the rule of three using the remaining columns; for 1998 - 2002 calculated by using annual average population data from General Statistics Office (2003, p. 27).

Table 5.2 provides a comparison of selected countries in East and South-East Asia in terms of internet use. While the number of internet users in Vietnam is relatively low compared to a the newly industrialised countries of the region and Japan, Vietnam has surpassed Indonesia and the Philippines in tenns of internet users between 2002 and 2004 and shows considerably higher rates of internet use than poor countries like Burma; Cambodia or Laos. In 2004 Vietnam had roughly as many internet users per 100 people as China, which in 2002 had an internet user ratio more than double that of Vietnam. Although internet penetration in Vietnam is overall relatively low, the country showed much stronger growth than others in the regions and is roughly en par with China, the world's fastest growing economy. Although the growth of the internet in Vietnam continues to be high compared to other countries in the region, the use of ICTs is very uneven within the country. In 1998, the first year of the internet, 14 of 61 provinces had no internet connections at all, while 90 percent of the country's connections were in the two largest cities, 58 percent in Ho Chi Minh City and 32 percent in Hanoi (National Centre for Social Science and Humanities, 2001, pp. 114-115). The level of concentration of internet connections in the two main cities has probably decreased, but internet subscription and use rates by

67 province are not standard variables in the annually published statistical yearbook or other regular publications and there is therefore no consistent measure available for this thesis.

Table 5.2: Internet Users per 100 Inhabitants by Selected Countries 2002 - 2004 Country 2002 2003 2004 Burma (Myanmar) 0.05 0.05 0.12 Cambodia 0.22 0.25 0.28 China, P.R. 4.60 6.15 7.23 Hong Kong (SAR) 43.01 47.18 50.32 Indonesia 2.12 3.76 6.52 Japan 46.47 48.30 50.20 Korea, South 55.17 61.07 65.68 Laos 0.27 0.33 0.36 Malaysia 31.97 34.5 38.62 Philippines 4.40 4.93 5.32 Singapore 50.44 50.88 56.12 Taiwan 47.6 51.94 53.81 Thailand 7.76 11.26 11.25 Vietnam 1.85 4.30 7.12 Source: International Telecommunication Union, 2006.

In the province of Hai Duong, located in the northern industrial heartland of the Red River Delta between Hanoi and the port city Hai Phong, provincial records indicate only 2609 internet subscribers (Vietnam Investment Review, 2005c), or 1.5 subscribers per 1000 inhabitants. In spite of its proximity to Hanoi, the province has an urbanisation rate of only 15 percent. In comparison, as early as 1998 Hanoi had 2.4 internet connections per 1000 people and Ho Chi Minh City had 2.1 (National Centre for Social Science and Humanities, 2001, pp. 114). It was reported in 2005 that the number of registered internet users in Ho Chi Minh City was still seven times higher than the national average (Vietnam Investment Review, 2005a). Using telephone density as a proxy indicator for the overall integration into telecommunication networks, suggests highly uneven levels of connectivity. Figure 5.1 shows the highest telephone density in Hanoi and Ho Chi Minh City. Medium and upper medium levels can mainly be found in and around the other three centrally administered cities of Hai Phong, Danang and Can Tho, while low and very low levels are most common in the central coast areas and the northern and central highlands.

68 Figure 5.1: iLao Cai Telephone Density by Province

, Dien Bien Phu'

~~> * ... Hai Phong~~

~~Telephone Lines per 100 Inhabitants in 2003 >Vinh • Oto 8 (48) • 8to16 (9) • 16 to 24 (3) • 24 to 32 (1)~~

~~Da Nang~~

~~A Pleiku 100 200 kilometres~~

~~Buon Ma Thuotj~~

~~DaLat \ IP~~

~~-,Ho Chi Minh Cir< Legend • City / Town ^Can Tho" I I I Railroad Major Road~~

~~Date: July 2006 Source: General Statistics Office Vietnam Map: Bjorn Surborg~~

69 There is a relatively high correlation between the level of urbanisation and telephone density6, as shown in Figure 5.2. Moreover, only four provinces have more than 15 telephone lines per 100 inhabitants, while there is a large cluster of provinces with fewer than 10 lines. Hanoi and Ho Chi Minh City accounted for 34 percent of all telephone lines in the country, but only about 11 percent of the population. In spite of the use of proxy indicators, the data used in Figures 5.1 and 5.2 suggest a strong bias towards provinces located in the two main deltas and.urban areas in terms of internet access.

~~Figure 5.2: Telephone Density and Urbanisation by Province in 2003~~

~~Percentage of Urban Papulation~~

~~100 -, One dot represents 90 one province~~

~~70 1~~

~~50 1~~

~~0 10 15 20 25 30 35 Telephone Lines per 100 Inhabitants~~

~~Source: General Statistics Office, 2006~~

~~The High Price of being On-line~~

~~Average incomes in Vietnam remain relatively low and the cost of accessing the internet is likely a major factor in the diffusion of the technology. Average access costs~~

~~6 r = 0.82; Telephone Density: mean = 6.60, standard deviation = 5.05; Urbanisation: mean = 22.62, standard deviation = 16.36.~~

70 were reduced by more than half during the first five years of the internet in Vietnam, from an average 400 VND per minute in the period November 1997 to November 1998 to 150 VND per minute during the November 2001 to November 2002 period (Lam, Boymal & Martin, 2004, p.47). At the average price of 150 VND per minute one hour of internet access everyday would cost 3.285 million VND per year. The GDP per capita in 2002 was 6.7 million VND per year7, just slightly more than double the cost of accessing the internet for an hour a day. Such high cost in relation to average income suggest that internet access is reserved for an exclusive and privileged group. Moreover, accessing the internet will be almost an unattainable luxury for poor people, who were still comprising 28.9 percent of the population in 2002. The overall poverty line for the 2002 Vietnam Household Living Standard Survey was set at 1.92 million VND per year, while the food poverty line was 1.38 million VND per year (Asian Development Bank, 2003, p. 19). In addition, income inequality in Vietnam is rising (cf. chapter 3), so that poorer people benefit proportionally less from increases in national income and are thus less likely to access the internet in the future than for example medium income people, who may increase their income sufficiently to access the internet.

Income is not only unevenly distributed amongst the total population of Vietnam, differences in income are also highly regional. Figure 5.3 shows a map of per capita income in 19998. The highest per capita incomes can be found in and around the largest cities, while low incomes are clustered in the north and north-west. However, there are very few provinces in the upper medium and high per capita income categories, meaning that the larger urban centres not only have the highest incomes, but also that the'income differences are extreme.

7 Own calculation from General Statistics Office Vietnam (2006) Data. 8 GDP by province is not a standard variable in the annually published statistical yearbook or other regular publications. The 1999 data are therefore used.

~~71 Figure 5.3: iLao Cai Per Capita Income by Province~~

~~: Dien Bien Phu~~

~~Hanoi~~

~~,Hai Phong~~

~~GDP per Capita in '000 VND, 1999 • 1,500 to 2,499 (16) • 2,500 to 4,999 (37) 5,000 to 7,499 (5) 7.500 to 9,999 (0) 10.000 to 40,620 (3)~~

~~Sji-Da Nang~~

~~N A 100 kilometres~~

~~Thuotj^~~

*feNha Trang

~~Legend -,Ho Chi Minh Cityii O City / Town H—| h Railroad ^Can Tho~ Major Road~~

~~Date: July 2006 Source: National Centre for Social Sciences and Humanities, 2001 Map: Bjbrn Surborg~~

72 Employing more recent data, Figure 5.4 shows the relationship between telephone density and per capita retail spending, whereas per capita retail spending is used as a proxy for general prosperity of a geographic area and telephone density as an indicator for overall access to telecommunication technology. Generally speaking, the data suggest that the wealthier an area is the higher the access to communication technology9. Some caution has to be employed, when using overall retail spending data rather than household expenditure data as a proxy for prosperity, because the spending is not necessarily local, but may be the result of tourism or large foreign investments, which may not benefit the local population. However, the pattern suggests a concentration of both wealth and communication technology in a few urban centres, mainly Hanoi and Ho Chi Minh City.

~~Figure 5.4: Telephone Density and per Capita Retail Spending by Province in 2003~~

~~Per Capita Retail Sales of Goods and Services in billion VND~~

~~One dot represents 14 one province~~

~~8 •~~

~~6 • • % • • 4~~

~~0 5 10 15 20 25 30 , 35~~

~~Telephone Lines~~

~~er 100 c ^ i r\± ~t- onnc P Inhabitants Source: General Statistics Office, 2006 r~~

~~9 r = 0.86; Telephone Density: mean = 6.60, standard deviation = 5.05; Retail Sales: mean = 3.46, standard deviation = 2.66.~~

73 While telecommunication services are becoming more widely available, the newest technologies and highest capacity networks are available mainly in the cities. The country's first high speed internet service through the cable television network was offered in Hanoi in early 2005 and about half a year later the same service was offered in Ho Chi Minh City. The Hanoi service provider Vietnam New Generation Telecom (VNGT) intends to offer its service city wide by 2006 and to provide high bandwidth services such as online gaming, conferences, home or office cameras and video-on- demand in the near future. High-speed Digital Subscriber Line (DSL) internet service, which is delivered through existing copper telephone wires, is available in Vietnam since July 2003, when state owned VDC started to offer the service in Ho Chi Minh City, Hanoi and Hai Phong (Web Center VDC1, 2006). Around 100 000 subscribers used the service by mid 2005 (Vietnam News Brief Service, 2005m, 2005o; Vietnam Investment Review, 2005d). The service was available for the relatively low cost of 50 000 VND per month not including the charges for the telephone line, which is significantly lower than the access cost for dial-up in 2002, but still unattainable for poor people (Vietnam News Brief Service, 2005m). Given its use of existing telephone lines, DSL service is more widely available than the service via the cable television network. By April 2005 DSL service was offered in 51 of 64 provinces (Vietnam News Brief Service, 2005o), but given the low telephone density in many provinces, it is likely that this form of high-speed internet remains an urban phenomenon as well. In addition, telephone services were not available in 6.5 percent of the country's approximately 10 000 communes (Xinhua News Agency, 2004). Similarly, wireless internet access points have been installed in big cities by two of Vietnam's ISPs, but the companies have targeted only international airports, big hotels and coffee shops (Vietnam News Brief Service, 2005p). Thus wireless service is not only limited to urban spaces, it is also available only in a few selected places within such urban areas, mainly spaces that are exclusive to paying customers. Even internet cafes, the most publicly accessible places for using the internet, are concentrated in big cities. In 2002 a university student reported that access fees were seven times higher in his home town of Pham Tiet, a port town 180 kilometres north of Ho Chi Minh City, than in Ho Chi Minh City, because internet cafe owners in Ho Chi Minh City were able to split one

74 connection between ten to 20 computers, while cafe owners in Pham Tiet can only split each connection between two or three computers, because of the poor quality of the connections. The same newspaper report says that there were at least 1500 internet cafes in Ho Chi Minh City and 500 in Hanoi, while Pham Tiet had only eight (Due Hung & Ngo Hong Hanh, 2002). For remote and mountainous communes, the VNPT subsidiary Vietnam Telecom International (VTI) initiated a satellite project in 2005 to deliver broadband internet and other ICT services. Internet service was planned to be available in two different packages with different up- and download speeds for 730 000 or 1.16 million VND per month, which is more than ten times the price of the DSL service offered in the cities. The installation of the necessary equipment, including a small satellite dish, a modem and a computer would cost about 29 million VND (approximately 1825 US Dollars) (Hai Van, 2005; Vietnam News Brief Service, 2005b). The primary target provinces for the programme are in the northern and north central coast regions. Provinces in the northern regions include Lang Son, Cao Bang, Ha Giang, Son La, Dien Bien and Lai Chau, which have, according to the Inter-Ministerial Poverty Mapping Task Force, overall estimated poverty rates of between 62 and 80 percent and rural poverty rates of between 73 and 88 percent using a poverty line of less than 1.8 million per person per year. Provinces targeted for the programme in the north central coast region include Nghe An, Thanh Hoa and Quang Binh, which have overall poverty rates of between 46 and 47 percent and rural ones ranging from 49 to 51 percent. The main gateway centre for the system with large antenna frames is located in Ha Tay province just outside Hanoi. The service is in operation since April 2006 (Vietnam Telecom International, 2006; Hai Van, 2005; Minot, Baulch & Epprecht, 2003, pp. 5, 23-24). Given that the cost of accessing the internet for three months even through the cheaper option of this service exceeds the poverty line for one person for one year and that up to 88 percent of the rural population in the target provinces are poor, it is virtually impossible to make this a widely used technology. Access must be limited to wealthy individuals, government offices and private businesses. As shown in table 5.3 most of the targeted provinces, especially in the two northern regions, have a very high share of minority populations. The use of satellite

75 technology might be in part a response to the mountainous terrain, especially in the northern provinces and the eastern part of three the coastal provinces, where the minority populations are primarily located. However, satellites are a technology that can provide a relatively high speed of transmission, but relatively low capacity, which implies that there is little expectation for mass consumption of communication technology in areas with a high share of ethnic minorities.

Table 5.3: Share of Ethnic Minority Population in Selected Provinces Province Region Total population Percentage Minority Lang Son North East 703 824 83.5 Cao Bang North East 490 335 95.3 Ha Giang North East 602 525 87.9 Lai Chau (incl. Dien Bien) North East 587 582 83.1 Son La North West 882 077 82.6 Nghe An North Central Coast 2 858 748 13.3 Thanh Hoa North Central Coast 3 467 307 16.4 Quang Binh North Central Coast 794 880 1.9 Source: General Statistics Office Vietnam, 1999.

~~Mass Medium or Service for Private Property~~

For the period between 2005 and 2010 the government of Vietnam is planning to implement an ambitious e-government strategy. The strategy is intended to be implemented first at the central levels of ministries as well as provincial and municipal10 agencies, while lower level implementation depends on the provincial authorities. Local area networks in the provinces that connect local offices and communes are supposed to be ready to integrate into a national network by 2010. Again, the strategy is first deployed in cities. In Ho Chi Minh City and Hanoi half of all enterprises are able to declare taxes, register businesses and receive business licences online, while a quarter of residents in centrally administered cities, including Ho Chi Minh City, Hanoi and Danang, will be able to use "electronic identification" (Trang Anh, 2005). Given the low internet penetration, especially in remote provinces, as well as the prohibitive internet access costs for poor populations, including many just above the poverty line and not officially

~~10 Although the source does not specify the term municipality, it most likely refers to centrally administered cities that are administratively at the level of a province.~~

76 recognised as poor, the e-government strategy appears to be a rather pointless exercise, if the goal is to make government services more widely available. The establishment of Local Area Networks amongst provincial offices will likely be a useful tool in improving the efficiency of the public administration. However, this does not change the top-down administration from the central level, at least not automatically. The technology, in fact, is more likely to aid the manifestation of central control, because it integrates local administrations more closely into the central apparatus, simply through faster communication and increased exchange of information. This information will only be received by state officials, while the great majority of the population will not have direct access to the electronically transmitted information. In the immediate aftermath of the Russian revolution in 1917 Lenin controlled information by controlling paper supply. Communication and printing devices were tightly controlled in the Soviet Union and access to a photocopier required two authorised signatures for a Russian text and three for a non-Russian text. The very idea of a "personal computer" ran counter to Soviet ideology (Castells & Kiselyova, 1995, p. 38). Given the Communist Party's continued claim to be the leading political power in the country, the question arises, why would there be any incentive for wide open information dissemination over the internet? The most likely answer would be that the transition to an open market system from a centrally planned economy requires open information flows. Nonetheless, on open market system can function without open access to all political information. Hence, connecting local authorities to the internet and more importantly to government networks, possibly including password controlled intranets (the electronic form of the authorisation signature), may be an effective means of protecting the monopoly on political power of the party, because economic constraints will prevent the majority of the population from participating in this information exchange. Any information, directives and instructions will reach the larger public through the traditional mass media with established censorship procedures or the filtered communication of local authorities. At the same time the internet acts as a provider of economic information to an emerging bourgeois class, which can afford access to the new technology. This type of information flow, in form of e-commerce, internet banking, electronic securities trading

77 and others, is not only authorised, but supported by the government, as the above discussion outlines (cf. chapter 4). A 2005 government report to the national assembly identifies business and construction licensing as well as services related to land.use rights and house ownership as the most required online services (Trang Anh, 2005). These are all services related to private property. As part of the Public Administration Master Programme for 2001 - 2010, the publication of legal documents on the internet is intended to foster public debate and strengthen public awareness and involvement as well as grassroots democracy. This will unlikely be the case due to economic restrictions to access the internet for the great majority of the population. The proportion of internet users in Vietnam remains small, even smaller is the proportion of internet subscribers. In addition, the internet remains a largely urban phenomenon. It is thus a technology that supports primarily a new urban bourgeoisie.

~~A Public - Private Alliance~~

While large proportions of the Vietnamese public have no access to the net, a small elite is highly connected, well informed and in charge. The architects of doi moi have based many of their strategies on the expectation of large sums of FDI into Vietnam. However, as early as 1996 the influx of foreign money slowed down (Beresford, 2001; see chapter 3), increasing the pressure to actively promote and attract more FDI, giving state agencies concerned with attracting FDI and investors themselves more leverage in influencing the Vietnamese public policy agenda. The inclusion of the Ministry of Planning and Investment in the drafting of the inter-ministerial circular on internet use in 2005 is one example for this increased influence. Moreover, transnational corporations are gaining a voice in policy debates, including those regarding internet use. The chairman of Shell Vietnam Companies, Nguyen Huy Tarn, for instance, discussed improvements for businesses with the newspaper Dau Tu (engl.: Investment), making the following suggestion:

~~We have proposed to apply a tax enumeration system via the Internet, not like the current paper system. Tax authorities should regularly update new tax~~

78 circulars on the Internet, which will help enterprises to stay up-to-date on new policies without having to trapse down to tax agencies to get a copy. Tax authorities need to set up a telephone hotline to resolve enterprise worries. They must also avoid obscure definitions in their documents, which often lead to misunderstanding (Vietnam News Brief Service, 2004b).

The suggestions by Nguyen Huy Tam are clearly aimed at making business procedures more efficient in Vietnam and the Vietnamese government has implemented public policy to respond to suggestions like the one above, as shown in its initiatives on e-commerce, e-customs and e-government, many of which are aimed at services related to business and property. In addition, international donor agencies support programmes aimed at improving business conditions in Vietnam, including those related to the internet. Often such programmes are aimed at accessing export markets for small and medium sized enterprises. Decision making regarding internet use is thus a process based on the interrelationship between the corporate fraction of the transnational class, e.g. representatives of Shell, the state fraction, e.g. bureaucrats and politicians in the Ministry of Planning and Investment responsible for FDI, and the technical fraction, e.g. advisors and consultants of international organisations. Considering the strong initiatives in e- commerce, the consumerist fraction is likely to have some influence in the public policy debate as well. In Vietnam the transnational capitalist class is - oddly enough - comprised of representatives of capitalist private businesses and representatives of capitalist states as well as communist cadres, acting in the interest of and benefiting from the promotion of capitalism in the country. This class is highly urban, concentrated mainly in the national company headquarters, ministries and government departments as well as representative offices of international organisations in Hanoi and Ho Chi Minh City. The class has outliers in the provinces, through the subordinate departments of the national ministries, field advisors of international organisations and representatives of transnational firms, as for example local buyers, workshop supervisors or consulting engineers.

~~79 The Path to Development and the Global Economy~~

• Both major cities in Vietnam, Hanoi and Ho Chi Minh City, have achieved a considerable presence in the network of world cities. The Globalisation and World City Study Group and Network for example ranks Hanoi 120 and Ho Chi Minh City 74 out of 316 cities based on the presence of global producer services firms in a city" (see also Taylor, Catalano & Walker, 2002). Hanoi is also closely integrated into an inter-state city network defined by foreign ministries and embassies, a supra-state city network with UN agencies as network makers and a trans-state city network created by non-governmental organisations (Taylor, 2005a). Although Ho Chi Minh City is generally considered the main commercial centre of Vietnam while Hanoi is the political capital, the two cities are certainly centres of power and influence in both domains, especially if political and economic decision making processes are considered the result of combined efforts by actors in the public and private sectors. Both cities are thus the combined command and control centres of Vietnam. They have the highest telephone density, the greatest access to the internet and usually adopt new technologies first. In Frank's (1972) classification of dependency theory they are the metropolises in Vietnam, but act as the satellites to the global metropolis. This role as the satellite is exemplified by several internet related policies and initiatives that allow the tighter integration of Vietnam's rural hinterland into the global market system, which is facilitated by the transnational capitalist class and its local agents. Sklair (2005, p. 60) characterises the members of the transnational capitalist class as having "outward-oriented globalizing rather than inward-oriented localizing perspectives on most economic, political, and culture-ideology issues". The transnational capitalist class has driven a "shift from import substitution to export promotion in most developing countries since the 1980s" and shaped the free trade agenda (Sklair, 2005, p. 60). The reformers in the Vietnamese government promote such strategies, as the country's desire to enter the World Trade Organisation shows and do not hide their global

" The Globalisation and World City Study Group and Network data were produced by P.J. Taylor and G. Catalano and constitute Data Set 11 of the GaWC Study Group and Network (http://www.lboro.ac.uk/gawc/) publication of inter-city data.

80 orientation. They are tuning into the rhetoric of opportunities in the global market place, as a statement by the Deputy Minister of Post and Telematics, Mai Liem True, who supported the political control of the internet and under who VNPT protected its monopoly as the sole internet exchange provider in Vietnam until 2002 (Hong Ha, 2002), at a round table discussion emphasises:

In the past, we grasped many opportunities but we sometimes lost them too. At present, while other countries are at a strong period in globalisation, Vietnam is still an underdeveloped and poor country falling behind. Yet the globalisation process is coming on fast and strong, with providence. It comes to each rice field, each cup of coffee, each shrimp-rearing pond and each power-loom. Since opening its doors, Vietnam has ranked second in the world for exporting rice, first for pepper and has at times had a strong influence on the global coffee market. Vietnam's basa catfish made up 20% of the US catfish market recently as well. That's the opportunity of globalisation and international labour division. Any company or producing region that catches that opportunity would develop very quickly. (Vietnam Net Bridge, 2005)

Globalisation is presented by Mai Liem True as an inevitable force descending onto every spot on planet earth and therefore the logical consequence is that if Vietnam does not engage with it, it will fall behind and remain an "underdeveloped" country. It is therefore necessary for everyone to engage in the global economy and only then will one "develop", assuming that there is only one generic progressive path to development (cf. e.g. Cowen & Shenton, 1996). Mai Liem True, the Deputy Minister of Post and Telematics, provides agricultural products as examples for Vietnamese success, not products with a higher value added such as telecommunication technology or logistics services. The reference to the international division of labour as an opportunity can only refer to the availability of cheap labour in Vietnam, which is required in the agricultural export sector.

~~Integrating into the Global Market Place~~

A small pottery business in the south eastern province of Binh Duong has seized an opportunity by exporting its products to the United States and the European Union. The relatively small enterprise has grown from 10 employees in 1993 to providing 30 jobs in a rural area in 2005. The company's director considers internet research as well as

81 overseas exhibitions and catalogues an effective means to sell his products overseas. The company's annual average turnover is 600 million VND (38 000 USD) and most of the 180 million VND (11 800 USD) profit are reinvested into the company. The average salary of employees is 800 000 VND (50 USD) a month, which the director concedes is not high (Vietnam Investment Review, 2005e). A full-time staff employed throughout the entire year would earn on average just under 10 million VND, which is more than five times above the poverty line, however, this salary will not support a family with two children and two dependent parents, a common family constellation in Vietnam. While the pottery business has brought opportunities and jobs into a rural area, its main competitive advantage on the world market is likely low labour costs. While the low labour costs, which the IMF and World Bank considered Vietnam's main competitive advantage (Kolko, 1997, p. 49), may initially bring some opportunities, prospects for long term development are poor, as the manufacturing sector has declined in status to a peripheral activity in the world system and income elasticity is low. Hence, the small pottery business is unlikely to enhance its profits through product development and will have to keep wages low in the long run to be competitive, reducing its employee's chances for improving their livelihoods. The internet in this case provided a means to integrate into the global market system, but given the structural challenges prosperity for the producers will be limited. In the fruit industry an alliance between domestic ICT firms, the Vietnam Chamber of Commerce and Industry and the Vietnam Fruit Association urges fruit companies to employ ICTs, starting with basic internet applications, to export their products. The Vietnam Competitive Initiative is funded by the United States Agency for International Development (USAID) and conducted a survey amongst 116 fruit companies suggesting that 92 percent of companies need to apply more information technology (Vietnam News Brief Service, 2005k). The Vietnam Competitive Initiative is another example, where the internet and ICTs function primarily as an export marketing tool. The fruit industry is labour intensive and requires large amounts of land, which given the recent conflicts over land issues, is a potential risk to the social cohesion of rural Vietnam.

82 The internet in this case facilitates access to labour resources as company owners can market their products more easily, but the long term development prospects are small given the agricultural sector's low income elasticity as well as trade restrictions and large subsidies in industrialised countries to their own agricultural sectors (cf., e.g., Wallerstein, 2004). The largest beneficiaries in Vietnam are likely the owners of the fruit companies and local IT firms, most of which are located in Ho Chi Minh City, through the increased sale of software products, but this is likely to benefit a small number of urban professionals only. The internet will thus aid access to cheap labour and cheap natural resources by international buyers, through the collaborative initiative of international professionals at USAID as well as local technocrats at the Vietnam Chamber of Commerce and Industry and the Vietnam Fruit Association, who are global in their outlook, as well as by company representatives of local IT firms that are likely equally global in outlook, considering the internationalisation of the business and the marketing strategy as an outsourcing provider of at least one of the companies, ironically called Goodland (Goodland Informatics Inc, 2004). Internet technology also plays a significant role in integrating Vietnam's coffee producers into the global market. About 100 domestic and foreign companies were scheduled to present their coffee and related products at the Central Highlands Coffee Festival in Dak Lak province, Vietnam's primary coffee producing region, in December 2005. Computers with internet connections were planned to be set up at the festival to facilitate transactions on the London futures (terminal) market. The event was announced by Dak Lak chairman Nguyen Van Lang at a press conference held not in the province's capital Buon Ma Thout, but Ho Chi Minh City (Vietnam News Brief Service, 2005c). The opening of a coffee trading floor in Dak Lak is scheduled for September 2006. Transactions at the centre will be facilitated by network technology and member organisations can conduct business via the internet. Trading takes place between 19:30 and 21:00 hrs (Vietnam News Brief Service, 2005a), which is approximately mid-day in London. Vietnam's largest coffee exporter, state-owned Tay Nguyen Coffee which accounts for about 20 percent of the country's coffee exports, has set up a unit to monitor coffee prices on the internet daily between 16:00 hrs and midnight (9:00 - 17:00 hrs in

~~83 London) using Reuters News Agency in order to set the buying price from local producers for the next day (Saigon Times, 2003; Van Bao, 2003).~~

~~The area under coffee cultivation in Dak Lak was reported to be approximately~~

~~250 000 hectares in 2003 (Saigon Times, 2003; Van Bao, 2003) and 163 000 in 2005~~

(Vietnam News Brief Service, 2005a, 2005c). Coffee prices on the world market have been low and the decrease in area under cultivation is likely a result of falling prices and a lack of profitability. In 2003 almost 60 percent of the province's agricultural land were under coffee production12. The central highlands have high proportions of minority populations as well as poor people and the area has long been a force of resistance to central control, resulting in considerable riots in February 2001, for example. The coffee boom in the late 1990s has brought more than 50 percent of the agricultural land under coffee cultivation, while landlessness has increased (cf. chapter 3) suggesting an

~~increased concentration of land holdings in fewer hands and greater dependency for a~~

~~larger number of people on wage labour. The internet in this context has aided large~~

~~companies, like Tay Nguyen Coffee to access the market as well as natural resources and~~

~~cheap labour performed by newly landless peasants, while the majority of people had no~~

~~access to the internet for information due to prohibitive costs and high rates of poverty.~~

~~The internet is a technology, which is part of placing Vietnam in a particular position of the world system. It connects places of production and sale through an~~

~~existing urban hierarchy, channelling resources from remote rural areas of Vietnam~~

~~through large cities, like Ho Chi Minh City, to the highest ranking global cities, as for~~

~~example London. The process is facilitated by the internet, amongst many other factors,~~

~~but also through a network of individuals and organisations that set up the bureaucracy~~

~~for efficient pottery, fruit, coffee and certainly other commodity trading. Members of the~~

~~transnational capitalist class and local agents play a crucial rolein facilitating the~~

~~continuing dependency of peripheral places.~~

12 Based on an agricultural area of 422.7 hectares, as reported by the General Statistics Office Vietnam. (2006). Agricultural area was reported separately for Dak Lak province and Dak Nong province, which were previously one province. If the area under coffee cultivation was still reported for the province prior to the split, the percentage would be 43 percent based on total agricultural land of 586 hectares in both provinces.

~~84 Vietnam as a Source of FDI~~

While the internet has been a means of integrating peripheral production in Vietnam into the global economy, internet and telecommunication technology is most recently becoming a source of core-type production in Vietnam. Wallerstein (2004, p. 28) stresses that core and periphery are relational concepts, which refer to the degree of profitability. Core type products are those produced under the protection of quasi- monopolies and are thus most profitable. Countries with a fairly even mix of core and periphery type production are considered to be in the semi-periphery and Vietnam is moving into that direction (cf. chapter 2). Vietnam relies on foreign suppliers in the telecommunication industry to upgrade its infrastructure. Cisco Systems, headquartered in San Jose, California, for example, provides Data, Voice and Video Integration (DDVI), Virtual Private Network (VPN) and Wireless Local Area Network technology to Vietnam (Vietnam Investment Review, 2000), while Alcatel of France, for instance, provides high-speed ADSL (Asymmetrical Digital Subscriber Line) products and next generation network technology for the integration of data and voice networks (Vietnam News Agency, 2005b). In early 2005, however, VNPT started to invest into overseas projects and planned to open representative offices in other countries, focusing first on Laos and other ASEAN members. In May 2005 the VNPT subsidiary VDC signed a contract with the Laotian telecommunication company ETL to upgrade internet channels to Laos from 10 Mbps to 34 Mbps. At least some Internet traffic from and to landlocked Laos is thus likely to be routed through Vietnamese exchanges and VNPT owned transmission lines (Vietnam News Agency, 2005d). Similarly, VDC is providing broadband internet services to Cambodia (Vietnam News Brief Service, 2005n). Since quasi monopolies rely on the protection of strong states, core production processes are primarily located in such states, giving the core-periphery structure a particular geography (Wallerstein, 2004, p. 28). With the provision of telecommunication services to Laos and Cambodia and likely some other production processes, Vietnam has moved from a peripheral country into the direction of a semi-peripheral country. VNPT, which operated a state protected monopoly until 2002, now provides a core-like product

85 to Laos and Cambodia, which both have very low internet use rates (cf. Table 5.2). Vietnam has also repositioned itself in the global pattern of internet geography, as it is not the farthest outlier in the star-shaped (cf. chapter 2) network of fibre-optic lines, but acts as a channel of data traffic to neighbouring Laos.

~~Integrated into the Global Economy through Uneven Geographies~~

Growth in the internet sector in Vietnam since late 1997 was substantial, but given a late and low starting point, the technology is still not widely available. The internet remains a largely urban phenomenon and high prices, especially in rural areas, prevent poor people from accessing the net, while a small urban bourgeois elite is well connected. New technologies are generally first available in large cities. The government of Vietnam has initiated an ambitious e-government programme, which provides services primarily related to property ownership and is thus likely to benefit businesses and wealthy individuals first, while it is practically unavailable for poor people. In the context of the market economy, the internet is, however, a means of communication and providing information. The public policy agenda is increasingly shaped by private corporations and members of the transnational capitalist class are powerful actors in the decision making process of public policy. The internet in Vietnam provides a means of integrating rural and remote areas into the global economy and to channel resources through a global urban hierarchy out of these areas. At the same time some Vietnamese industries are also producing core-type goods and services in the telecommunication sector, selling these to neighbouring Laos and Cambodia, which reconfigures Vietnam's position in the global internet geography as well as the core-periphery structure. Access to the internet is selective based on the cost of access, while it is presented as an opportunity for all in the new global economy. For many poor people internet access is an unattainable luxury, but the internet reaches even remote areas. While high• speed internet through satellite technology, for example, is not an option for the great majority of people in Vietnam, especially in rural areas, businesses use the internet for marketing and promotion of rural products, often agricultural, that can compete on the

86 world market through very low labour costs. The transnational capitalist class and its local agents are spinning a network of instantaneous communication to a select few, who control trade and set the prices for local products, as for example coffee. The internet is not a mass medium with ubiquitous access, but a highly selective piece of infrastructure, creating a channelled and uneven geography, leaving large parts of Vietnam to engage in periphery-type production, while a few urban centres, with uneven internal geographies, have been elevated into the network of world cities.

~~87 Chapter 6: Conclusion~~

There have been substantial changes in Vietnamese society since the introduction of doi moi in 1986. These changes have affected urban dwellers and people in the countryside alike:, but most likely in different ways, shapes and forms. However, substantial changes in society have occurred throughout Vietnamese history and in that sense doi moi is a continuation of ongoing reforms in the country, but the events of the sixth Party Congress in 1986 symbolise some of the most profound changes in this ongoing reform process. Reform had happened before 1986, especially in the agricultural sector, but the opening of the economy to the west and the active promotion of FDI was unprecedented in its form. A rather small piece in the overall reform process and integration into the world economy is the internet in combination with other Information and Communication Technologies. This small piece is, however, of great significance in some aspects of Vietnam's process of modernisation, including the symbolic value of the high-tech sector to western style development and the integrative capacity of the network for some economic processes and the newly emerging urban bourgeoisie. Throughout this thesis I have argued that the internet in Vietnam was a substantial part of economic liberalisation without enhancing political reforms. I have argued that internet has helped the VCP to maintain its monopoly on political power through measures of flexible control of the internet and selective access mechanisms, while presenting the technology as an opportunity for all through the country's integration into the global economy. The political elite in Vietnam has advertised free market values exceeding at times the expectations of the IMF and World Bank, while aligning itself with local and international business communities in their efforts to commodify local resources by utilising cheap labour as the main competitive advantage and integrating the country's rural hinterland into the global economic system.

~~88 Flexible Control of the Political Arena~~

After the first cooperation with a western telecommunication company started in Vietnam in 1987, the Vietnamese government has taken very careful steps in integrating the country into the global "spaces of flows" (see Castells, 1996, 1997), taking another ten years to implement legislation that allowed full connectivity to the internet. At the same time the party ensured through this legislation, in form of Decree 21/CP, the full control over the net by trusted agencies of the state, while removing considerable independence from the research community and international actors. The state introduced some competition into the internet market in Vietnam, but maintained control over the international connections in and out of the country. Organisations acting as Internet Exchange Providers, the only providers legally entitled to provide international connections, have to be majority owned by the state and internet content provided from within Vietnam, has to be licensed by the Ministry of Information and Culture, while information originating outside Vietnam can be firewalled from the Vietnamese sections of cyberspace. Within its political borders the Vietnamese state has thus maintained its overall control over the infrastructure that provides the basis for the internet. However, the internet has grown and information flows have increased, making strict control of all information transmitted practically impossible. The limitations of directly controlling the internet by the state are countered by downloading the responsibility of policing the net to provider organisations and individuals. Internet Service Providers and internet cafe owners are responsible for the use of the internet by their clients and are required to actively exercise this control through personal data collection and direct observation of internet activity, to avoid clients accessing inappropriate web-sites or other on-line services, including pornographic material or subversive information. Often it is impossible for clients to notice, when surveillance is actually occurring, transforming the internet into a virtual panopticon (see Foucault, 1995). The need for this surveillance is framed in a discourse of social evils (i.e. pornography, drug abuse and gambling) and traditional Vietnamese customs that require protection from the forces of western cultural influence. Although the theme of social evils is part of everyday life in Vietnam, the fight against their

89 frequent occurrence is lax. On the other hand the Vietnamese state acts with its full force in the case of dissidents utilising the internet to transmit information that state authorities consider a threat to the state and party's hegemony. Given the conditions created in Vietnam, the internet provides little that would enhance Habermas's (1984, 1987) concept of a radical discourse, which achieves mutual agreement amongst members of society through an open and radical discourse, in which all members or groups in society engage freely and without hidden intentions. The discourse on social evils in combination with the limited actions against it and the decisive actions against internet dissidents is therefore covert strategic action by the Vietnamese state in the debate on internet development. Moreover, the process of integrating the Vietnamese economy into the global market, of which the internet is a substantial part, is presented as an opportunity for all people in Vietnam, yet opportunities are unevenly distributed in society and geographically. Only about 16 percent of the population are currently internet users, while less than five percent are subscribers to the internet and telecommunication infrastructure is concentrated in big cities. The internet will therefore not directly provide opportunities to the vast majority of the Vietnamese population, while in some areas access is likely limited to an extremely small selection of individuals and government or business offices. Considering the selective access and the mechanisms of flexible control, the internet does not provide any means for a radical discourse. To the contrary, it provides an uneven discourse across uneven geographies.

~~Uneven Integration~~

The distribution of political information remains restricted on the internet in Vietnam and electronic publications are integrated into the existing censorship regime of mass media. Commercial and official administrative use on the other hand are virtually unrestricted and encouraged. The government provides property related services on-line and promotes e-commerce. The equitisation process of State Owned Enterprises and land trading can be facilitated via the internet. The state has engaged in a public-private coalition that benefits from the increasing commercial use of the internet, while the

90 majority of Vietnamese does not have access to the net. At the same time due to its monopoly on political power the party controls the state and the discourse surrounding the internet and the country's global integration, creating an impression of a free market that provides equal opportunities for all. Yet this tight alliance between business and governments benefits primarily a newly emerging urban bourgeoisie that controls on one hand the means of production (private business, including newly equitised firms) and on the other the means that facilitate production and trade (public offices and administration).

In addition, this urban bourgeoisie acts as the local agent of the transnational capitalist class or is part thereof. This class is global in its outlook and loosely connected through common interests, such as the protection of private property and capital accumulation. Increasingly the private sector, including large and transnational corporations, gain influence in the public policy debate in Vietnam and enhance policies that make commerce and trade more efficient. Such policies include e-commerce and property related government services.

~~Uneven Geographies~~

The socio-economic environment created through these policies is highly conducive for large businesses to integrate into the global market, as illustrated through the coffee trade. Some small or medium sized enterprises, as illustrated through the cases of the fruit industry and a pottery business, may also be able to seize some opportunities, but in all likelihood there is little opportunity for upward social mobility of workers in the rural areas since the industries in these areas engage primarily in periphery-type production, which offers little or no income elasticity. At the same time Vietnam's two primary urban centres include some core-type industries, such as telecommunication technology, which Vietnamese companies begin to export to neighbouring Laos and Cambodia.

In the context of dependency theory (Frank, 1972) the internet has provided a means to access the resources of rural Vietnam in a more efficient manner and thus channel natural resources and the proceeds of human labour through the national satellite

91 cities into the "world metropolis" (i.e. North America and Western Europe). However, Hanoi and Ho Chi Minh City are integrated into a system of world cities and are beginning to engage in core-type production processes, which in the context of world systems theory include products that currently provide a high value added. While Vietnam imports ICT products from traditional core countries, including so-called newly industrialised countries, there are small parts of the urban based Vietnamese economy that are or have the potential to be a mechanism to channel resources from countries with more peripheral type production to Vietnam through the urban system, facilitated by the transnational capitalist class.

While remote areas have become more accessible in economic and commercial terms, accessibility in political tenns is limited and fdtered. The vast majority of individuals in rural areas, especially in generally poorer regions, lacks the financial means to access the internet, but an ambitious government initiative aims at connecting all provincial government offices to a centralised network. While such a network makes rural areas accessible through the internet, the information inevitably flows through official channels and will be distributed through the filters of local cadres. Not only would such a government network be limited to official information in the first place, it would also not be directly accessible to most people.

~~Power: a Matter of Connectivity~~

The VCP maintains its monopoly on political power and maintains flexible control over the internet. After creating a regulatory environment that allowed the surveillance and content control of the internet through a controlled discourse of social evils and traditional Vietnamese customs, the state stirred the internet project from an independent research initiative into a commercial and administrative enterprise, which enables an alliance of government officials and business elites to benefit in terms of power and influence and business opportunities from the internet. Being aware of the possibilities of surveillance and the state's decisive action against dissidents or being oblivious to the former and engaged in a discourse of opportunities for all through the internet there is little direct opposition to the government's internet regulations. The lack

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~~115 Appendix I~~

~~List of News Sources Included in Initial Search:~~

~~Vietnam Investment Review The first international quality English-language newspaper produced in~~

n . . Vietnam, covering economic and political developments, investment escnp ion. opportunities, changes to laws, banking regulations, tourism, culture and general information. Country of origin: Vietnam Source Code: VNAMIR Language: English Most Recent Issue: 7 November 2005 First Issue: 29 March 1993 ______Frequency: Weekly H Update Schedule: As available Online Availability: 1-2 weeks after publication date Source Coverage: Full Coverage Article Coverage: Full Text Format: Text Publisher: Vietnam Investment Review

iVietnam News Agency Bulletin Description: Magazine covering news events in Vietnam. Country of origin: Vietnam Source Code: VIETNA ______Language: English !Most Recent Issue: 2 December 2005 First Issue: 2 January 2001 Frequency: Daily Update Schedule: Daily, as available Online Availability: Same day as publication date Source Coverage: Full Coverage Article Coverage: Full Text Format: Text Publisher: Vietnam News Agency Web Address: http://www.transdatacorp.com

116 jVietnamNews Brief Service . _ Daily summaries of local issues from the national press and specialist [Description: publications in Vietnam, focusing on banking and finance, investment and the trade environment. Country of origin: Vietnam Source Code: VIETNB Language: English Most Recent Issue: 2 December 2005 First Issue: 6 January 1999 Frequency: . Monday-Friday Update Schedule: 8 a.m. (GMT) Online Availability: Same day as publication date Source Coverage: Full Coverage Article Coverage: Full Text j Format: Text [ Publisher: Toan Viet Limited Company |i

Vietnam Courier English-language weekly publication aimed at foreign investors. Country Description: of origin: Vietnam Source Code: AIWVIC Language: English Most Recent Issue 27 April 1997 First Issue: 23 February 1997 Discontinued: 31 July 2001 Frequency: Irregular Update Schedule: Not available Online Availability: Discontinued Source Coverage: Selected Coverage Article Coverage: Full Text Article Selection Criteria:Selection of articles determined by provider Format: Text Publisher: Vietnam News Agency Web Address: http://ft.com

117 Vietnam Economic News Weekly publication incorporating business, economic and general news Description: on Vietnam. Country of origin: Vietnam Source Code: VIETEN Language: English Most Recent Issue: 16 November 1999 First Issue: 1 October 1998 Discontinued: 31 July 2001 Frequency: Weekly Update Schedule: Not available Online Availability: Discontinued Source Coverage: Selected Coverage Article Coverage: Full Text Article Selection Criteria:Selection of articles determined by provider Format: Text Publisher: Toan Viet Limited Company

Vietnam Economic Times Published monthly. Geared towards Vietnamese businessmen and Description: foreign investors looking for business opportunities in the Socialist Republic of Vietnam. Country of Origin: Vietnam |Source Code: AIWVET Language: English Most Recent Issue: 1 January 1999 First Issue: 1 April 1997 Discontinued: 31 July 2001 Frequency: Monthly Update Schedule: Not available Online Availability: Discontinued Source Coverage: Selected Coverage Article Coverage: Full Text Article Selection Criteria:Selection of articles determined by provider Format: Text Web Address: http://ft.com

Vietnam Law & Legal Forum __ __ Law and legal news published by the Vietnamese government. Country of Description: Origin: Vietnam Source Code: VLLF Language: English Most Recent lssue:1 August 2001 First Issue: ' 1 July 2001 Discontinued: 1 August 2001 Frequency: Irregular Update Schedule: Not available Online Availability: Discontinued Source Coverage: Full Coverage Article Coverage: Full Text Format: Text Publisher: Vietnam News Agency

~~118~~