Impact of Economic Liberalization on Rice Intensification,Agricultural Diversification,and Rural Livelihoods in the Mekong Delta,Vietnam

Abstract

In the late 80s, the Socialist Republic of Vietnam embarked on bold economic liberalizationpolicies. The ensuing market, price, credit, and land tenure reforms allowed very reactive smallfarmers to use new technologies and to improve their livelihoods thanks to a dramatic agriculturalgrowth, especially in irrigated rice production. This was particularly the case in the MekongDelta and this article analyzes the impact of the economic liberalization reforms on this crucialagricultural system. The process of rice intensification is explained in detail, and an analysis ofthe closely related dynamics of diversification into non-rice activities is also provided.The intensification of rice-based production systems with more fixed capital, working capital, and labor led to an increase in family incomes. But the evolutionary pathways of farming householdsreveal that, depending on their initial endowment in productive resources, the pace of capitalaccumulation has been unequal among farmers. Consequently, economic reforms are leadingto an increased differentiation among farming households in terms of types of production system and income level. At a time of increasing use of chemical inputs and renewable natural resources, and as socialinequalities lead to labor migration, several key technological, environmental, and socioeconomicissues regarding the sustainability of rice intensification and agricultural diversification processes are discussed.