Upland Transformations in Vietnam

7. Market Relations in the Northern Uplands of Vietnam

Market Relations in the Northern Uplands of Vietnam  7 Market Relations in the Northern Uplands of Vietnam Nghiêm Phương Tuyến and Masayuki Yanagisawa Introduction The term “market network” refers to the way in which supply and demand interact, in a particular social and historical context, to price commodities and the means of their production. It also refers to social relations (social strata) or the powers of exchanging parties that determine the function of the market system (Smith 1977). In such unequal relationships, whoever controls the means of production (resources and production tools) will control the prices of commodities being exchanged in the market. That is to say, commodity prices are more reflective of the distribution of resources than they are causative (Painter 1987). As a result, a disadvantaged party that enters the market system with unfavourable relations will always be exploited, while the advantaged party goes on accumulating capital. In the market network, the disadvantaged party (rural sellers) cannot equalize its position just by being more productive. What can help is gaining access to resources and other means of production as well as the ability to manage them. The relationship between rural sellers and urban buyers forms the “market organization”. Stephen Corry (1993) views the relationship between rural resource harvesters and urban intermediaries in quite a negative light. Rural people in need of cash income for purchasing basic consumer goods may be motivated to sell products obtained by exploiting their local natural resources to outside wealthy intermediaries, even though the latter control the market unfairly by dictating terms of trade most of the time. When such an unequal relationship exists, rural-urban interactions are controlled by those who control the distributive system.   Upland Transformations in Vietnam The market network is strongly associated with, if not a determinant of, the distribution of marketplaces and is the main factor that influences the functions of the market system (Painter 1987). While distribution of marketplaces affects the functions of the market network characterized by social classes and power, control over productive resources and means of production determines the terms of trade. As Barbara Harris-White (1996) observes, when villagers engage in trading activities that reveal themselves geographically in patterns of marketplaces and a tracery of commodity flows, both between rural areas and between rural and urban areas, they are also involved in social relations of exchange. Such social relations establish market networks. In Vietnam, economic liberalization (known as reform, or Đổi Mới) has brought about economic changes in rural households. These changes permit people, information, commodities and money to flow more speedily within a spatial setting (Vũ Tuấn Anh et al. 2000). Such changes create endogenous dynamics for mountain villages to open up, initiate and develop their marketing system. The questions in this chapter are: How does the market emerge? And how does it affect small agricultural producers? The focus is on interactions in the market. The answer comes from a case study in an upland district of the Northern Mountain Region of Vietnam. Bảo Thắng district Bảo Thắng District is located in the heart of Lào Cai province, in the central north of the Northern Mountain Region of Vietnam. To the north it shares a boundary of 15 kilometres with Hakou District, in China’s Yunnan province. The district is surrounded by a number of other districts and adjoins Lào Cai town. Bảo Thắng District has 15 administrative units. For a mountainous district, Bảo Thắng enjoys rather ideal topographic conditions. The landscape is generally flat, with gentle slopes ranging between 3 and 5 degrees, which is favourable for agricultural production. The district’s transportation system includes waterways, a railway and a road network (Figure 7.1). Although Bảo Thắng is a mountainous district, Kinh people are its major ethnic group, accounting for almost threequarters of its population. The Kinh were resettled in the district from Hải Phòng and Thái Bình provinces in the Red River Delta during the 1960s, when there was a nationwide government programme to establish new economic zones in the mountains.1 The agriculture and forestry sectors make up a dominant share (65 per cent) of the district’s economic structure. Within these sectors, forestry (22 per cent) has been increasing Market Relations in the Northern Uplands of Vietnam  recently because of massive planting of cinnamon and...