The growth model embraced by Vietnam during the last two decades, in an
urbanization context, has prompted deep social economic transformation. The
private sector has been thriving with the transition of a command economy towards
a “socialist-oriented market economy” since the Doi Moi (Reform) launched in 1986.
Economic growth has helped reduce poverty considerably, but in the mean time, spark
increasing social inequality. The gap within a region and between urban and social
areas has widened (Cling et alii, 2009). Market freedom, meanwhile, paved the way for
the development of an informal economy.
To understand on-going trends better, it would be necessary to seek to study
the mechanisms which cause different growth impacts on the living conditions of
households in cities and rural areas. If the growth appears to be most favourable to
urban dynamics, which type of household would most benefit from it? What are the
characteristics of these households in terms of their access to the jobs and sectoral
market? Knowing that private investment obviously pours into two of the country’s
economic hubs, namely Ho Chi Minh City (HCMC) and Hanoi, which, on their own,
attract 90% of foreign investment, how would that dynamic be seen in periurban and
rural areas? In this context, how would the informal sector evolve and what is its role
on the labour market? An analysis of the sector’s characteristics will help focus on the
job opportunities offered to the households. Our study is part of a research programme
on the informal sector in Vietnam jointly conducted by the Research Institute of
Development (Development, Institutions and Globalization Division) and the General
Statistics Office1.