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Vietnam vs Philippines: Economic Development
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Excluding ranking, figures, and indexes, why does Vietnam feel more developed and prosperous than the Philippines?
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Because if you include various indexes, rankings and figures, the Philippines is actually worse off than Vietnam, hence the feeling of Vietnam being a more “developed” country. To name a few of the prominent indexes: 1, Poverty rate Where in Vietnam will you find people living in cemeteries, people sleeping under bridges, people eating pagpag to get by, and the unending scene of slums in urban areas? Even in the impoverished mountainous areas of Vietnam, poor people don’t scour the rubbish to get food and live in cemeteries. The ones scouring rubbish in Vietnam are actually scrap dealers, and many of them own lots of money, mind you. 2, Infrastructure: The Philippines have worse infrastructure than Vietnam. Looking at Metro Manila alone and say the Phils has better infrastructure is hilarious. Vietnam has more equitable development among different regions, and between urban and rural areas. In the same breath, the Philippines fares much worse in logistical performance Logistical Performance Index, Global Rankings 2018 3, Economic performance: Vietnam exports much more than the Philippines. In 2018, Vietnam was the third largest exporter in ASEAN, after Singapore and Thailand. In the first half of 2019, it overtook Thailand to become the second largest. As far as I’m concerned, the Asian tiger economies all became developed by export-oriented industrialization. Export performance also reflects the manufacturing capacity of an economy. Any country with more than 20 million people inevitably needs industrialization and manufacturing to develop, and in this regard Vietnam is doing much better than the Phils. In other words, the Philippines is a consumer economy, Vietnam is a manufacturing economy. Because of its dismal manufacturing capacity, the Philippines suffers a staggering amount of trade deficit every year. In 2018, the Philippines has a trade deficit of $42 billion, while Vietnam has a surplus of $8 billion. Made-in-Vietnam products are now going to the supermarket shelves in various countries of all continents, where are Made-in-Philippines products besides bananas, coconuts and mangoes? In terms of steel production, the Philippines is nowhere to be seen. Vietnam meanwhile is the 17th largest producer of steel globally, and the 1st in ASEAN. The largest steel producing complex of Southeast Asia is now in Ha Tinh province, with the investment amount of $12.87 billion. This is a good headstart for Vietnam to upgrade into more sophisticated forms of steel making. Why steel? Because it is the bread for industrialization. It’s a must for heavy industry to develop. Do you seriously expect a country to successfully industrialize by consumer products and agricultural produce processing only? Also in cement production, another bread for industrialization Vietnam is world’s third largest cement producer And the biggest oil refinery factory in Southeast Asia, with the investment value of $9 billion, is now in Vietnam. The factory is just part of the thousand-hectare Nghi Son economic complex focused on heavy industry in Thanh Hoa province. https://m.plo.vn/thoi-su/nha-may-loc-hoa-dau-9-ti-usd-chinh-thuc-van-hanh-809434.html As for electricity consumption per capita Which means Vietnam is more ready for industrialization since its electricity production annually is much higher than the Philippines. More broadly, as seen in the bar chart, the more developed countries than Vietnam all have more electricity consumption per capita, except for Indonesia and Philippines => Vietnam is the most attractive investment destination for foreign investors since its regional rivals, both the more developed countries (Indonesia and Philippines) and less developed countries than Vietnam (Cambodia, Bangladesh, Myanmar, Pakistan) are facing electricity shortages. This is evidenced by the amount of cumulative received FDI List of countries by received FDI Tourism-wise, the Philippines, despite its enormous potentials, sadly is lagging behind by wide margin. If we are talking about agriculture, the Philippines is also less developed. Till this day it is still not a food-sufficient country and has to rely on imported rice to ensure food security instead. And where do they obtain the imported rice? Vietnam, Thailand, India and the like. World Exports and Imports of Agricultural products We are not even talking about telecommunications. Simply research Viettel, the second biggest telecommunications company in Southeast Asia behind Singtel (Singapore) and its operations in 3 continents and you know what I’m talking about. Thanks to Viettel, Vietnam became one of the first countries to experiment 5G calls, ahead of many more developed countries, and without having to rely on Huawei. Vietnam makes its first 5G phone call – VnExpress International This event marked Việt Nam as one of the earliest countries to successfully test a 5G network, after the US, Australia, Japan and South Korea. Another difference is Filipino economy is dominated by the ethnic minorities aka the ethnic Chinese and the mixed-blooded ones. Vietnamese economy is dominated by the ethnic majority aka the ethnic Vietnamese. Economically speaking, the only sectors in which the Philippines do better than Vietnam are overseas workers, remittances, call centers, real estates, casinos and some other forms of services, which are not key drivers for successful industrialization. 4, Various other fundamental socioeconomic indexes: Internet speed. For years the Philippines has had one of the lowest Internet speed in the regionSpeedtest Global Index – Monthly comparisons of internet speeds from around the world Income inequalityThe lower the better Access to electricity Access to clean fuels and technologies for cooking (% of population) Under-5 mortality rate Maternal mortality rate Life expectancy Investment in education Investment in healthcare Human Capital Index 2018, indicating the readiness of national workforce P/S 1: Seeing another answer which says the Philippines is “far ahead” of Vietnam based on comparing Metro Manila (or rather, some parts of it) vs Hanoi and HCMC is frankly hilarious. You know what? Hanoi and HCMC are the two worst planned cities in Vietnam due to overpopulation. Other cities like Danang, Ha Long, Vung Tau, Bac Ninh, Hai Phong, Thanh Hoa etc are actually much better planned. Still, you won’t find any slums the size of those in Manila in Hanoi, HCMC, or any Vietnamese cities for that matter. How Did Hanoi Grow So Big Without Developing Slums? As said earlier, Vietnam had much more equitable development among regions. Besides Metro Manila and Cebu, what other Filipino cities can rival Vietnamese cities? Even in second-tier and third-tier Vietnamese cities, construction projects are now everywhere and the city landscape transforms after just several years. Rural areas in Vietnam looks much better off than rural areas in the Philippines, Indonesia, even Thailand thanks to the New Rural Communities National Program (Chương trình mục tiêu quốc gia xây dựng Nông thôn mới). This program is also similar to the one South Korea implemented during its rapid industrialization process (Saemaul Undong). Some of the more prosperous rural areas in Vietnam look no different than their Vietnamese urban counterparts, except in name only. Some Vietnamese cities: Vung Tau Danang Nha Trang Ha Long Quy Nhon Hai Phong Hue Thanh Hoa Vinh Bac Ninh And many others. High-rise buildings and skyscrapers are now a common sight in Vietnamese cities across all regions. In the next few years, Vietnamese urban landscape will change much for the better, with many more cities rising. P/S 2: Before someone brings up the number for GDP and GDP per capita, allow me to keep you up-to-date. The figures for Vietnam’s GDP and GDP per capita have been underestimated for all those years, maybe deliberately by the goverment in order to get access to more favorable low-interest loans. Now that they can’t hide that anymore, the IMF stepped in and suggested they should do a re-calculation for GDP to have a better overall view of the national economy. Which the goverment accepted. Note that the re-calculation doesn’t change the methodology, just that this time the data for the 76000 firms, which have been unaccounted for, are now provided and properly calculated. Just yersterday, the estimated new figures were promulgated on Vietnamese media. According to the new calculations, Vietnam’s GDP will go up by 25.4%, translating into a $300 billion economy in 2018, with a GDP per capita of around $3100–3200, roughly the same as the Philippines and slightly lower than Indonesia ($3900). As the re-calculation is supervised by the IMF, it’s very likely the new figures will be accepted by the IMF, World Bank and other global institutions. At this rate, the Filipinos should well prepare for being left behind again very soon, this time by a country utterly ravaged by wars until 1989, being sanctioned by the US until 1995, having nothing but ashes and ruins when it opened up and only allowed to join WTO in 2007. Cheers!
Please briefly explain why you feel this answer should be reported.
Because Vietnamese ARE more developed and prosperous than Filipinos. Vietnam has a much lower poverty rate than the Philippines (9.8% vs 21.6% in 2016, according to World Bank) However, the majority of Vietnam’s poor are actually ethnic minorities residing in rural and mountain areas. Vietnam has a population of 97 million people and 54 ethnic groups. The largest ethnic groups are: Kinh (Viet) 85.7%, Tay 1.9%, Tai Ethnic 1.8%, Mường 1.5%, Khmer Krom 1.5%, Hmong 1.2%, Nùng 1.1%, Hoa 1%, with all others comprising the remaining 4.3%. In 2016, the poverty rate of Kinh and Hoa was 3.1%, comparing to the poverty rate of 44.6% for ethnic minorities. The overall national average is 9.8% because ethnic minorities account for 72 percent of Vietnam’s poor. Vietnam’s non-Hoa ethnic minorities (14% of the population) mostly reside in rural and mountainous areas, while the Kinh and Hoa (86.7% of the population) reside in lowland and urban areas. Kinh and Hoa people have very low rate of poverty The dramatic decline and low poverty rate means in a few years, Vietnam will completely eradicate poverty amongst Kinh and Hoa people. Vietnam also has plans to lift ethnic minorities out of poverty. Vietnam will double income of ethnic minority communities by 2025. Although Vietnam’s ethnic minorities earn half the amount of income as Kinh and Hoa people (Source), they do not live in destitute like the people living in slums in the Philippines They mostly live a natural lifestyle, raising their own livestocks, growing their own crops, building their own homes and living with nature. Furthermore, tourism to these areas have greatly improved their quality of life H’mong houses and terrace fields Ê đê people getting more recognition as Miss Universe Vietnam 2019 was from the Ê Đê ethnic group As for lowland communities like Khmer and Cham, their poverty rate actually dramatically decreased in the past few years, and their living standard increased significantly. Khmer temple in An Giang province Khmer temple in Tra Vinh province Khmer temple in Soc Trang Cham people in Nha Trang Champa Island in Nha Trang. Cham people are hired in this resort to promote traditional Cham culture including traditional arts, dances and performance Cham people performing on Champa Island A Cham mosque in Cham village, An Giang province Floating Cham village in An Giang province Conclusion: Skyscrapers do not measure the development or prosperity of a country. Skyscrapers signify density. Unlike Vietnam, the Philippines has one major metropolitan region, which is the focus of all their high density buildings. In contrast, Vietnam has 2 major metropolis which are neck to neck in terms of growth and prosperity. Despite having skyscrapers and high density buildings, the Philippines has a much higher poverty rate, and this is markedly visible on Filipino streets. Furthermore the inequality in wealth distribution can be observed from the lack of small and medium local businesses. This is in contrast to Vietnam where there are many family owned businesses and local eateries. A typical Vietnamese street with many small businesses