China and Vietnam in Transition: A Comparative Analysis of Economic Reforms and their Outcomes

Abstract

The economies of China and Vietnam have undergone major economic reforms and developments during the period of the 1980s to the present as each strives towards the attainment of a market economy, while maintaining the ‘Socialist’ character of their respective economies. Unlike developments in Europe where a number of formerly centrally planned countries adopted a ‘big bang’ transition approach to a market economy, in China and, at least initially, Vietnam the transition process has been a much more gradual one with over-riding political power still residing with their respective Communist Parties. However both countries have experienced considerable decentralisation of economic power, which has resulted in substantial difficulties for the centre in regard to macroeconomic management.