d activities. It lasted till the abolition of the two-price system in 1989 . The fourth stage is the Post-stage, characterized by a market economy that cannot be reversed and the emergence of factor markets, the fast growth of the free market in jobs . 4. Evaluation of Vietnam’s Economic Development PlansSecond Five-Year Plan (1976-1980) Priorities were given to heavy industry development on the basis of agriculture and light industry development as shown in Table 1 and 2 below. According to the plan, Vietnam either had to solve the consequences of the war or renovate the southern economy as well as the achieving some economic targets. With these goals in mind, Vietnam raised capital investment to develop a production force with the main activities of expanding and building State-owned business, especially heavy industry. However, the results from the expansion of socialism economic sector, the renovation of production relations and the building of material and technical bases were not as projected. Close central control and poor management of the economy led to a decline in industrial and agricultural production. The natural calamities in 1977 and 1978 left the agriculture sector devastated. Invasion of Cambodia in December 1978 and subsequent Chinese retaliation (February 1979) sent the economy into further doldrums. Furthermore, it resulted in a curtailment of aid from China; and trade and investment embargoes from Western countries. Life became difficult for the people. All the targets for the plans were not met as shown in Table 3 and led to the breakdown of the neo-Stalin model hence signal the emergence of “fence-breaking” activities. Furthermore, the government realized that a bureaucratic centralized economic plan lacked real fundamentals and acknowledged later that it was a mistake for not concentrating sufficient investments on agriculture when Vietnam is overwhelmingly a rural economyTable 1: Sectoral Compo...
