By K Govindan WAR has broken out in Vietnam. Only this time it's between Coca-Cola and PepsiCo.
The soft drink giants were among the first American companies to apply for investment licenses after the Clinton administration announced the lifting of the thirty year long trade embargo.
Vietnam's government welcomed the move for a number of reasons. In the long term it offers their exports access to the United States domestic market.
In the short term, the Vietnamese government hopes that the US will stop vetoing aid and credits from foreign banks and multi-lateral lending institutions like the International Monetary Fund and Asian Development Bank.
Private capital is openly welcomed under the seven year old policy of doi moi or renovation.
According to the official rhetoric this means a 'socialist-oriented market mechanism under state management'.
Similarly to the Chinese model of marrying economic liberalisation with political centralisation, the experiment in Vietnam has enjoyed some successes, but is beset with dangers.
Asian capital
Asian capital from Taiwan, South Korea, Hong Kong, and South-East Asian countries has been active in the export processing zones that have sprung up on the southern coast.
The US government's change of heart on trade sanctions has nothing to do with regret for the horrors of the Vietnam war and everything to do with US capital wanting a piece of the action.
Vietnam is the latest beneficiary (and some say victim) of the ilying geese' strategy of late capitalism. In the global economy capital migrates from one economy to another searching for cheap labour, weak worker organisation and lower environmental standards.
In reiurn for setting up manufacturing in shoes, textiles, plasties and electronics. foreign businesses are offered fuli ownership of the enterprise including 100 per cent repatriation of profits - the most relaxed investment code in the region.
Oil remains Vietram's biggest revenue earner. Its exploitation has financed some of the economic reforms including the massive strides in agriculture.
Coke From being an importer of rice, Vietnam is now the world's third largest exporter. There was à bumper crop in 1993 of 25 million tonnes.
The main reason for the turn around is the break up of state controlled co-operatives into individual holdings. Out of 22 million peasants 5.8 million work on their own piots while 16 million work in co-operatives.
Any vield above their state quota can be sold at market price and this has been a major incen. tive to increased production.
Thrown off
The down-side has been that tens of thousands have been thrown off the land and forced to leave their villages in search of work in the cities. A new class of rich farmers is emerging.
Also the government has been subsidising export-oriented industrialization by keeping food prices and therefore urban wages low. Make his a large Coke. The new US invasion is making big inroads into Vietnam In 1992 when food prices were pushed down by 19 per cent but the cost of fertilisers and seed and manufacturers rose in price, there was tremendous peasant dissatisfaction.
Considering that the majority of the 70 million Vietnamese live in the countryside this is a serious matter.
There is a growing urban-rurai divide with shops in the cities stocked with luxuries which only a few can afford; while in LO developed legal system and poor infrastructure.
The government has borrowed heavily to finance two major infrastructure projects. A north-south highway costing US$700m and a hydro-electric station priced at US$600m.
Schemes like these generally benefit the urban rich, not the poor. Vietnam's only legal trade union confederation is the General Confederation of Labour, which is committed to the tri-partite strategy of state, employer and worker negotiations to minimise work-place disputes and to maximise worker productivity.
Although minimum wage laws exist they are regularly flouted. Health and safety regulations are minimal, while pollution and environmental degradation have been prominent issues.
There is no indication that political pluralism will accompany economic reforms.
The Communist Party of Vietnam (CPV) does not recognise the right to form tendencies and factions within it.
Bribes
It controls the trade union movement thereby policing workers in the interest of foreign capitalists. Its leading official are growing rich on bribes and commissions and are the few who can afford shares in the privatised state enterprises.
Leon Trotsky's classic account of the rise of the bureaucracy in the Soviet Union, The Revolution Betrayed, has recently been translated into Vietnamese and published in France. It will find its way into Vietnam.
The writings of revolutionary Marxists must be made available to the Vietnamese people and practical activity in defense of the working class and rural poor undertaken too.
Separation of the party from the state, recognising the right of other parties to exist and permitting independent mass organisations of workers, peasants, women, youth and students to function are all aspects of socialist democracy which is Vietnam's next hurdle.