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I. Introduction
More than 10 years since have passed the introduction
of Adoimoi@ process, Vietnam has attained some
positive results as the economic growth rate
is higher and the people's lives are improved.
However there is a part of the population still
living in poor conditions. Moreover, Vietnam
is said to be one of the poorest countries in
the world. Thus, the national program for Hunger
Eradication and Poverty Reduction (HEPR) is
the major goal of the Vietnamese Communist Party
and Government.
The program for Hunger Eradication and Poverty
Reduction has been implemented throughout the
country since 1992 resulting in the number of
the poor people has reduced from 30 percent
in 1992 up to now 15,7 percent. There remain
some questions including: what is poverty, who
are the poor people, where are they living?
In order to answer these for this questions,
leaders, research institutions and policy makers
require the statistical sector have to provide
on the above questions in a timely and sufficient
manner
In this report, we introduce briefly relevant
concepts and the poverty line as well as the
limitations of data used in calculating poverty
in Vietnam.
II. Concepts of poverty
A. Concepts
Poverty refers to the state of a part of the
population which is not provided with the basic
Human needs that in accordance with the socio-economic
development level and local habits in each nation.
Based on the above concept, there are two types
of poverty as follows:
Absolute poverty: Absolute poverty is
the state of a part of the population that is
unable to satisfy essential needs for maintaining
their lives.
Relative poverty: Relative poverty is
the state of a part of the population living
in conditions below the average level of the
community.
In countries, which have low income per capita
such as Vietnam there are remains a significant
amount of hunger and poverty. Hunger and poverty
are close related, with hunger usually implying
a deeper state of poverty.
B. Measures of the poverty
line in Vietnam
In Vietnam, there are three poverty lines used
to determine the poverty state as follow:
- The poverty line of the
General Statistical Office (GSO).
- The poverty line of the
Ministry of Labour, Invalids and Social Affairs
(MOLISA).
- The poverty line of the
World Bank (WB).
1. The poverty line of
the GSO
Since 1993, basing on the experiences of the
WB and research in regional countries, the Vietnamese
GSO determined the National food poverty line
as follow:
- This poverty line is determined
by the income basing on the current price
sufficient to buy the essential food in order
to ensure the ration of 2100 calories per
capita per day. The households with income
per capita below the poverty line are considered
poor households.
- The poverty line of GSO
is calculated as follow:
- Determining the
food basket
Choose 12 food items, which contain approximately
2100 calories of the middle group income
quintile for two sectors: rural and urban
accounting for 90 - 92 percent of total
expenditure on food of the household.
- Calculate the value
of the above food basket in monetary terms.
- Determine the food
poverty line: based on the value of the
food basket adjusting for the value of
8-10 percent of the remaining food.
According to the above calculation, the food
poverty lines for different years are as follows:
|
Year |
Urban |
Rural |
|
1993 |
70 |
51 |
|
1994 |
102 |
75 |
|
1995 |
125 |
95 |
|
1996 |
136 |
103 |
2. The poverty line of
MOLISA
According to the MOLISA the poverty line is
based on the quantity of rice converted to money
on May 1997 as below:
- Hungry household: is a
household, which has income, per capita below
13 kg of rice equal to 45,000 dong (VND).
- Poor household: There
are defined differently for each of three
regions, which have the income criteria as
follows:
- Below 15 kg per month
of rice equal to 55,000 (VND) in the mountainous
countryside and islands.
- Below 20 kg of rice
per month equal to 70,000 VND in the delta
countryside and midlands.
- Below 25 kg of rice
per month equal to 90,000 VND in the urban
areas.
3. The poverty line of
the WB
- The high poverty line:
food and non-food poverty.
- The low poverty line:
food poverty.
Calculating:
- Determine the food basket.
- Choose 40 food items
of the third group (by per capita expenditure
quintile) containing nearly 2100 calories.
- Plus the consumption
of the non-food items making up 34 per cent
of the total consumption of the household
- The low poverty line:
Only calculate the value of the food- basket.
According to this measure, the poverty lines
of the WB in 1992- 1993 are as follows:
- The high poverty line:
- Total: 1,090,000 VND
per capita per year equal to 90,833 VND
per capita per month
- Urban: 1,293,000
VND equal to 107,750 VND per capita per
month.
- Rural: 1,040,000
VND equal to 86,667 VND per capita per month.
- The low poverty line:
729,000 VND per capita per year equal to 60,750
VND per month.
Advantages and disadvantages of the three poverty
lines mentioned above.
All three poverty lines aim to determine the
poverty situation in Vietnam.
- The poverty line of the
WB: Has the advantage that it deals with all
the food and non-food items and it is internationally
comparable. However if we apply the high poverty
line, the poverty rate will make up half of
the Vietnamese population. Moreover, Vietnam
is a poor nation, it would make it difficult
to concentrate resources to reduce poverty
of such a magnitude.
- The poverty line of the
GSO: Only touches upon the food and it is
also internationally and comparable. This
poverty line is lower. It aims to determine
a part of the poorest (those with not enough
to eat) in order to concentrate all forces
in the intervention efforts in the program
for Hunger Eradication and Poverty Reduction
to the year 2000 and 2010 of Vietnamese Government.
- The poverty line of MOLISA:
It is easy to calculate but it does not take
into account the consumption of other food
items except for rice. Currently, it can be
used to determine the number of poor households
and poor poverty communes identified for the
program for Hunger Eradication and Poverty
Reduction in Vietnam. However it can not be
used as a standard in comparison with the
international standards particularly with
countries which now are achieving the progress
of poverty reduction in the region.
III. Demand for information
and real situation of poverty in Vietnam.
A. Demand for poverty
information
The goal of the program for Hunger Eradication
and Poverty Reduction in Vietnam to the year
2000 is to eradicate hunger and improve the
quality of life and gradually reduce the number
of poor household in order to eradicate all
the households suffering from absolute by the
year 2010. So the demand for information about
the degree and extent of poverty in the whole
country and each region is of great importance
to the leaders at all levels and in all sectors
especially to the people who make and control
the implementation of policies relating to poor
regions and poor households.
B. The real state of poverty
in Vietnam
GSO determined the poverty line based on data
of the Survey on Wealth and Poverty carried
out in 1993 with the sample size of the survey
being 91,732 household and the Multi purposes
household survey with sample size of 45,000
households. The rate of poverty in Vietnam was
20 percent in 1993; 18,06 percent in 1994; 16,50
percent in 1995 and 15,7 percent in 1996. The
GINI coefficient indicates the inequality between
the income groups corresponding with the annual
poverty rates are as follow: 0.350 in 1994;
0.359 in 1995; 0.367 in 1996.
- The National poverty rate
of MOLISA in 1998 is 15,7 percent
- World Bank determined
the rates of poverty in Vietnam in 1992-1993
as follows:
- The high poverty
line is 51 percent
- The low poverty line
is 24.5 percent
IV. The poverty data sources
and their limitations.
Vietnam has not much experience in determining
the poverty line so the data about the poverty
state is often not sufficient. Moreover, the
household expenditure information used for the
annual household sample surveys is limited and
the information processing is slow. The M0LISA
has a system to collect information by approaching
each household. However because of using methods
of discussing, self-assessment and responsibility
data collection rests with local authorities
who may have incentives to owned report poverty
so these data are likely to be subjective. So
far, Vietnam has not built a poverty databases
and cannot meet requirements of the policy makers
in a timely manner.
V. Monitoring, evaluation
and recommendations.
In order to apply timely and sufficiently information
about the poverty situation, it is necessary
to establish a system aiming to monitor and
evaluate frequently and methodically in order
to provide reliable information used for planning
policies for Hunger Eradication and Poverty
Reduction Program.
It is also necessary to have a close cooperation
between the GSO, the MOLISA and related branches
in order to unify the definition of a national
poverty line in line with the socio-economic
conditions in Vietnam and have technical assistance
from International organizations in this process.
In order to satisfy the requirements mentioned
above, we suggest:
- Based on the household
sample surveys, it is necessary to establish
a poverty database in order to provide the
necessary information to determine the degree
and extent of poverty in the whole country.
- The International statistical
organization should organize workshops about
the poverty state frequently especially inside
the region, provide low income nations such
as Vietnam with the guidance and advice about
the measurement of poverty.
- Strengthen the technical
assistance from international or region statistical
organizations through surveys to learn experience
from establishing the poverty database and
have specific measurements to calculate the
poverty line for countries which have not
much experience in this field such as Vietnam.
Thank you for your attention.
Prepared by Mr. Cao Nhn Nguyet.
Expert of Social and Environment Department.
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