www.pep-net.org ISSN: 1908-6989 Vol. VI, No. 3, June 2009 Uncovering Regional Disparities in Poverty in Viet Nam Using CBMS Data* ∗∗ Vu Tuan Anh Below left, Dr. Vu Tuan Anh, team leader of CBMS-Vietnam. Below right, Vu Thi Than, President of the Women’s Union of Ninh Binh (WUNB). The WUNB is the CBMS implementing partner in the province of Ninh Binh. iet Nam has made considerable progress Vin poverty reduction in recent years. In fact, the country’s poverty rate has been halved in less than ten years. However, the rate of poverty reduction in some regions is still low. In view of this, identification of regional A tree-lined village lane disparities across several dimensions of in Son Tay poverty can facilitate targeting of the poor town, Ha Tay and formulation of appropriate anti-poverty Province, Northern Viet policies in each of these affected regions. Nam. Ha Tay Province is a During the past couple of years, the CBMS- CBMS site. Viet Nam project has cooperated with local partners in five provinces located in five Tran Thi Hoa/World Bank different regions to conduct poverty studies. reflect the failure of distribution policies and, In turn, Viet Nam’s poverty rate was reduced This paper presents the results of the CBMS possibly, inappropriate social and political by half in 2002 vis-à-vis its rate in 1993. This implementation in these localities and, in institutions. feat was repeated in 2006 when the poverty particular, illustrates how CBMS data can be rate was once again halved from its rate in used to uncover regional disparities in terms Regional disparity in living standards used to 1998.On average, therefore, Viet Nam’s of poverty. The main objective of the analysis be measured by the difference in income and poverty rate had halved every 8-9 years, is to find out the possible reasons for these expenditure of the population in different making the first goal of the MDGs completed observed disparities. Based on the results, regions. It is also measured by indicators of in Viet Nam. Viet Nam is considered as a some poverty alleviation policies as well as specific aspects of welfare such as education successful case in poverty reduction among the use of a CBMS-based, multi-dimensional and health. Regional disparity in poverty, developing countries. poverty index are recommended. meanwhile, is measured by the differences of poverty rates of different regions. Economic Growth and Regional Poverty Inside Disparity In the 1990s, Viet Nam witnessed an Economic growth is an essential factor in acceleration in the growth rate of its gross CBMS Network bares GFC improving the living standards of the domestic product (GDP), with an average sentinel sites 5 population and in reducing absolute poverty. annual GDP growth rate of 7.6 percent in the CBMS gains headway in Poverty incidence is lower in areas where last 16 years (1990-2006). During this period, Pekalongan 6 there is fast and stable economic growth. The Viet Nam’s population increased by 118 growth benefits are felt by the lower strata of percent while its GDP grew by 322 percent, CBMS-Philippines to pilot test society through the direct impacts on thereupon registering a GDP per capita growth indicators of missing dimensions employment and income generation. of 253 percent or 6 percent annually. Viet of poverty 7 However, increased disparities in the Nam’s per capita GDP was US$288 in 1995, CBMS methodology takes root distribution of wealth generated by economic $639 in 2005, and $835 in 2007. in Peru growth both across social strata and regions 8 * A condensed and edited version of the original paper of the author entitled Regional Poverty and Disparity in Viet Nam which was presented during the 7th PEP Network General Meeting held on December 10-12, 2008 in Makati City, Philippines. ** Project Leader, CBMS Viet Nam Research Results Despite these successes, however, poverty The rest of the four regions have reduced their in the framework of a research project of reduction remains a major concern for poverty incidence at different rates: poverty the Viet Nam Academy of Social Sciences in Vietnamese society, inasmuch as: rate in the Red River Delta declined by 20.5 the conduct of a nationwide sample · Poverty reduction is still fragile and, percent, in the Mekong Delta by 26.6 percent, household survey. The sample covered unsustainable. A large proportion in the South Central Coast by 21.9 percent, 14,044 households in 133 rural communes of the people still have incomes and in the Southeast by only 6.4 percent and urban wards of 63 provinces (of which that are very near the poverty line. although its original poverty rate was already 11,740 are rural households in 60 provinces As a result, they can easily fall into low (12.2%) in 1998. and 2304 are urban households in 16 poverty when natural disasters or cities). In each province, two communes / economic crises happen, or even The Northwest Region has the highest poverty wards were selected, and in each when a household member gets rate: it fell from 73.4 percent in 1998 to 49 commune/ward, approximately 100 sick. percent in 2006. On the other hand, poverty households were randomly selected for incidence in the Northeast Region dropped interview. The results of this survey showed · The disparities in income and living from 62 percent to 25 percent. Poverty changes of socio-economic situation of standards between rural and urban incidence dropped from 52.4 percent in 1998 households and communities (Vu Tuan Anh areas, and across different strata to 28.6 percent in 2006 in the Central Highland & Nguyen Xuan Mai, 2007). In this paper, and provinces, tend to increase. The Region. In fourth rank in the list of poorest data of this survey are also used, especially income gap between the richest regions in 1998, the North Central Coast those of rural households for an analysis of quintile and the poorest quintile Region fell to become the second poorest regional disparity. doubled in 15 years (According to region in 2006 with poverty incidence the living standard survey of Viet declining by 19 percentage points (from 48% The indicator set used in the CBMS is Nam’s General Statistical Office, it to 29%) (Table 1). rose from 4.2 percent in 1990 to 8.37 percent in 2006). The Gini Table 1. Poverty rates by region index based on the income 1998 2002 2006 indicator grew from 0.35 in 1994 to Rate Difference Rate Difference Rate Difference 0.42 in 2006 while the Gini index (%) (time) (%) (time) (%) (time) based on the expenditure indicator Whole country 37.4 28.9 16.0 remained almost unchanged, at Red River Delta 29.3 2.4 22.4 2.1 8.8 1.5 0.34 in 1993, and 0.37 in 2006. Northeast Mountains 62.0 5.1 38.4 3.6 25.0 4.3 6.0 68.0 6.4 49.0 8.4 There are two opposite tendencies: Northwest Mountains 73.4 North Central Coast 48.1 3.9 43.9 4.1 29.1 5.0 on one hand, the poverty incidence South Central Coast 34.5 2.8 25.2 2.4 12.6 2.2 is decreasing while, on the other Central Highland 52.4 4.3 51.8 4.9 28.6 4.9 hand, inequality is increasing. Southeast Region 12.2 1.0 10.6 1.0 5.8 1.0 Mekong River Delta 36.9 3.0 23.4 2.2 10.3 1.8 · Regional poverty disparity is Source: General Statistical Office, “Viet Nam Statistics Yearbook 2007”. extending despite of reduction in poverty rates in all regions of the Regional Poverty Disparity Measured by modified in regions and provinces to adapt country. Regional poverty disparity CBMS Data to the circumstances of localities. However, is reflected through the features In the past two years (2006-2007), the CBMS- a number of core indicators remain the noted below. Viet Nam project team has been supporting same in all surveyed localities. These local partners in 5 provinces in the conduct of common core indicators are used here to Poverty has declined significantly in all major the CBMS in 50 communes (45 rural examine regional disparity in the different regions in the country, albeit at different communes and 5 urban wards) in 14 districts aspects of socio-economic situation that rates. Among the 8 regions (Red River Delta, as shown in Table 2. are closely related to poverty. These Northeast Mountains, Northwest Mountains, aspects are: (1) household structure, (2) North Central Coast, South Central Coast, In the surveyed localities, there are 3 whole income, (3) dwelling, (4) property, (5) Central Highlands, Southeast Region, Mekong districts (Yen Bai, Ninh Binh and Lam Dong). education, and (6) health care. River Delta), four (Northwest, Northeast, Except for Quang Ngai, all surveyed localities North Central Coast and Central Highlands) consist of one or two urban wards and several Population and Household Structure are less developed in terms of economic level. rural communes. Although the structure of Regarding the age structure, the significant They are upland areas and most of the ethnic population in terms of rural-urban is not reduction in fertility and the gradual minority population live there. They face similar in the surveyed localities, the collected increase in life expectancy have resulted in many constraints in their development data can nonetheless still be used as an the ageing population in Viet Nam, with a process, including a difficult physical example for comparing localities in different smaller proportion of young population vis- environment, poor access to infrastructure regions.