Agriculture in Vietnam's Economy: A System for Economic Analysis

This USDA/AID work pulls a broad range of Vietnam economic and demographic data into an economic intelligence system. The analyses of these data lend valuable insights into inner workings of the Vietnamese economy to aid decisionmakers. Data inadequacies are apparent, but the USDA/AID team worked to develop as much economic information as possible into a logical system rather than dwelling on data shortcomings. Several analytical techniques are used to quantify economic relationships. Regression analysis, ranging from simple linear relationships to polynomial distributed lags, formed the basis of most of the analysis. Supply and utilization tables were constructed for major commodities, supplemented by seasonal analyses, index number construction, and a detailed economic profile. Much of the analysis is then drawn into an illustrative multi-equation framework of the Vietnamese economy. This framework provides important guides to policymakers through simulated alternative assumption levels. It also demonstrates important interrelationships within the agricultural sector, as well as between agriculture and the national accounts. Important conclusions are: ---Formal analytic techniques can give reasonable results even with data inadequacies and social upheaval. These techniques demonstrate that relative food prices are directly related to differences in income and demand elasticities. ---Assuming stable relative food prices: (1) More than a third increase in food production will be required over the next 5 years to feed the growing population and offset food imports. (2) Additional food production increases may be absorbed by increased domestic demand resulting from increased GNP and associated higher income levels.