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Impacts of Price Hikes on the
Lives and Livelihoods
of Poor People in Viet Nam
Figure 4.2: Changes in comparative purchasing power due to “double-edged“ prices,
June 2007 – June 2008
%
20
10
0
-10
-20
-30
-40
-50
Income per day
of simple waged
labor in Le Chan
district (Hai Phong)
Monthly income of a poor
household in Kien An
district (Hai Phong)
Equivalent
purchasing
power on Rice
Sức mua Gạo
Sức mua Thịt lợn
Equivalent
purchasing
power on Pork
Monthly income of a
migrant households with 2
laborers in Go Vap district (HCMC)
Although the cost of labour has increase by 50-60 percent poor people interviewed at the study sites have
seen a 30-50 percent reduction in the number of days they get hired to work per month (due to the influx
of migrant workers from the country side). Their real total income per month has therefore only increased
by 20-25 percent.
Food and food stuff products are sold through a network of stores. Prices change on a daily basis according
to notification by wholesalers to agents and retailers. Rice retailers in Hai Phong and HCMC also noted that
they did not benefit much from the rise in the rice price (especially during the “virtual hike” of rice prices at
the end of April 2008) as, because of limited capital, they could only stock a small volume of rice. They had
purchased rice when the price was high and sold it when the price fell. They would like to see prices staying
stable so that they could manage their profit better.
4.2 Features of Urban Poor’s livelihoods and Consumption, Buying and Selling Patterns
The urban poor people consist of two groups: the permanently registered poor and the migrant poor.
The permanently registered poor (having permanently registered urban residence) are often old-aged,
sick, disabled, single or people living with HIV/AIDS who are dependent on their family members for small
business jobs or manual work. According to the existing official poverty line, there are very few local poor
households in Hai Phong and HCMC (the poverty rate of the surveyed wards in urban and suburban
districts is below one percent; except for Ward 6 of Go Vap District where there are no poor households as
per the poverty line of 500,000 VND/month applied to HCMC). In addition, there are people who rely on
limited monthly pensions or social assistance and whose children have left home. These people do not have
alternative sources of income and are often considered near-poor.
In sub-urban districts there are still “poor clusters” located near dykes, cemeteries or remote alleys where
infrastructure remains poor and land is cheap. There is no clean water supply or a sewage system in place.
Pathways are often flooded and muddy when it rains. The cost of electricity is also 3-4 times higher than
the standard rate since there is not yet a system of individual household electrical meters installed. People
living in these clusters include locals who have failed to cope with urbanization and a number of migrant
workers who earn their living doing simple jobs such as cyclo drivers, construction workers and street
vendors. Residential Unit 30, Lam Ha Ward, Kien An District, Hai Phong is a good example.
An ‘island village’ in the centre of the city
Located right on the side of Niem Nghia bridge, Residential Unit 30, Lam Ha Ward, Kien An District, Hai
Phong city is called an “island village” for two reasons: (i) most of the residents are returnees from ‘new
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