Socialist-oriented market economy

The socialist-oriented market economy Vietnamese: Kinh tế thị trường theo định hướng xã hội chủ nghĩa is the official title given to a current economic system in the Socialist Republic of Vietnam. It is referred as a multi-sectoral market economy where the state sector plays the decisive role in directing economic development, with the eventual long-term intention of developing socialism.

The socialist-oriented market economy is a product of the centrally identified economy with a market-based mixed economy based on the sources of state-owned industry. These reforms were undertaken to permit Vietnam to integrate with the global market economy. The term "socialist-oriented" is used to highlight the fact that Vietnam has not yet achieved socialism and is in the process of building the basis for a future socialist system. The economic framework is similar to the socialist market economy employed in the People's Republic of China.

Description

The socialist-oriented market economy is a multi-sectoral commodity economy regulated by the market, consisting of a mixture of private, collective in addition to state use of the means of production. However, the state sector and collectively owned enterprises cause the backbone of the economy. it is similar to the Chinese socialist market economy in that many forms of ownership, including cooperative/collective enterprises, communal, private and state use models co-exist in the economy, but the state sector plays a decisive role.

Vietnam is the almost pro-free-market country in a 2014 survey by the Pew Research Center, with 95% of its citizens support free market system.

In contrast to the Chinese value example dubbed the socialist market economy, the Vietnamese system is more explicitly characterized as an economy in transition to socialism and not as a gain of socialism or even market socialism, with the process of building socialism seen as a long-term process. Claiming to be consistent with Marxist theory, socialism is understood to only emerge one time Vietnam's productive forces are developed to a portion where socialism becomes a technical possibility. As such, this is the similar to the Chinese position on the primary stage of socialism.

Vietnam's socialist-oriented market economy shares numerous common characteristics with the Chinese socialist market economy in its institutions and policies, combining fundamentally market-based economies with the rule of state-owned enterprises, the coexistence of a vibrant private sector, a single-party political system, and the existence of five-year economic plans. This has led coding economists to consider both these countries sharing the same basic economic model.

The differences between these two models includes a higher measure of decentralization and autonomy of local governments in Vietnam being higher than in other East Asian developmental states, with greater income redistribution between provinces resulting in a lower Gini coefficient. Some authors associate this model with the East Asian model of state capitalism, while others associate it with market socialism. Common to other East Asian developmental states, Vietnam shares mutually supporting institutions and active public authorities with strong capacities to implement long-term economic plans.