Partners in progress: Ghana and Vietnam?

The two foreign countries in which the author has lived and worked for a total of thirty years recently caught his attention because, according to World Bank statistics for 2012, they were on parallel courses of development with the same GNI (gross national income) per capita. In these stark economic terms, they have remained at the same rate for several years, rising from around $1,200 in 2009 to $1,550 in 2012.

After its recent years of rapid progress, Ghana has claimed to have achieved lower-middle income status among the community of nations. Presumably this claim is also made by Vietnam, however to those who know both countries they appear to have little else in common. It is necessary to delve much deeper into the available statistics to find the limits of their apparent wealth equality.

The two countries are very different in population and size. Vietnam is much larger with a population of about 91 million in an area of ​​332,000 square kilometers, while Ghana has about 25 million inhabitants occupying 228,000 square kilometers. Each Ghanaian has about two and a half times as much space as their Vietnamese counterpart, but the gap is narrowing because Ghanaians reproduce almost twice as fast despite a three times higher infant mortality rate. The indication is that the demographic situation is more stable in Vietnam and this stability is also reflected in the economy where the average inflation rate (1990 – 2012) was 9.7% against 25.4% in Ghana.

Gross GNI per capita figures are often seen to hide wealth disparities between rich and poor. Therefore, it is interesting to compare the share of the nation’s wealth enjoyed by the richest 20 percent of the population with that left to the poorest 40 percent. In 2012 the balance was 49:15 in Ghana and 43:19 in Vietnam. Much remains to be achieved in both countries, but once again Vietnam is in the lead with the richest 20 per cent being on average 4.6 times richer than the poorest 40 per cent versus a disparity of about 6 .6 in Ghana. There are many people below the World Bank poverty line of US$1.25 a day in both countries, but the percentage in Vietnam is 16.9 while in Ghana it is 28.6.

Relatively less poverty in Vietnam is reflected in longevity. On average, a newborn baby in Vietnam can expect to live almost 76 years, while his contemporary in Ghana can expect only 61. Of course, climatic conditions and the prevalence of diseases affect this issue, but the provision of the water supply , sanitation and medical services are even more important. Whatever the detailed differences, there is no doubt that the lot of the poor is somewhat better in Vietnam.

Vietnam appears to be improving with respect to most socioeconomic indicators. It has an adult literacy rate of 93.4 percent vs. 71.5, primary school enrollment of 99.4 percent vs. 84.3, and a child labor rate of 6.9 percent vs. 33.9.

All developing countries receive development aid from richer countries, so it is interesting to see how much progress depends on this aid and how much is achieved by the country’s own efforts. In 2012, Vietnam received aid (ODA) of US$3,595.2 million or about 3.1% of GNI, while Ghana received US$1.8 billion or about 4.7% of GNI. This data again favors Vietnam, which appears to be achieving more with relatively less foreign aid.

Attempting to explain the correspondence in overall economic performance with the great diversity of detail between these two countries would require much more time, space, and skill than is currently available. Those who know the two countries report the impression that people work much harder in Vietnam and this could explain part of the difference. Ghana’s income is derived mainly from the export of natural resources: cocoa, gold, timber, bauxite, and recently oil and gas, while Vietnam’s income comes from the large production of manufactured products from the labor of its people in many foreign and domestic countries. own factories.

Finally, it must be said that Vietnam’s progress in difficult economic and demographic conditions is largely due to government stability and long-term planning. Ghana’s turbulent history with numerous military coups and changes of government made long-term planning impossible. However, now that government stability has been achieved, it should be possible not only to match Vietnam’s overall macroeconomic progress, but also its achievements in distributing the benefits of development more evenly among the population.