performed important roles especially in the agriculture sector (see Chart 2-V-12). However, reforms have been carried out in the direction of reducing the cooperatives' roles and increasing the autonomy of households.

In the north, prior to the reforms of 1981, farmers were working for “work points” under the command of cooperatives. The same kind of collectivization was designed in the south after unification, but it resulted in the stagnation of production.

Agricultural reforms took place in 1981 and in 1988 in the direction of increasing the farmers' autonomy. Both of these reforms had positive effects on the production, as you can observe in Table 2-V-8 and Chart 2-V-13.

After the reforms of 1981, agricultural production activity came to be based on production contracts between each farmer and cooperative. Each farmer rented farmland from the cooperative and was required to supply the production norm. The products collected by cooperatives through such contracts were, after deducting production costs and taxes, redistributed to farmers according to their work points. Any surplus over the norm was left to the farmers' discretion; thus farmers had incentives to increase production. There was also a rise in prices of agricultural products (up to five times) in 1981.

However, this reform was designed within the framework of agricultural collectivization. Cooperatives still continued to control most of the products. Important means of production remained in the hands of cooperatives. Fertilizer and other inputs were allocated through the national resource plan. There were frequent revisions of the norms, although they were declared to be fixed for five years in principle.

For a while, the reform produced good results and agriculture production increased temporarily. However, the remaining control by cooperatives or local authorities more or less spoiled the incentives of farmers and is obviously one of the factors which brought about the stagnation or the decrease in production in 1986 and 1987.

The reform in 1988 gave more decisive autonomy to farming households. Each farming household was formally identified as a basic unit of production, and Vietnamese agriculture shifted from a cooperative basis to a household basis. Most cooperatives reduced their size and function, and the means of production formerly owned by cooperatives was transferred to farmers. Simultaneously, agricultural products market developed in the overall trend of market development in Vietnam, and farmers acquired easier access to the market to sell their products. Furthermore, in 1989, compulsory procurement by the government at prices lower than the market price was abolished; the system of allocation of fertilizers and other inputs also shifted from subsidized distribution based on national resource plans to allocation through market transactions.

As a consequence of these reforms, agricultural production has again increased since 1988, and as is frequently referred to as one of the monuments of the Vietnamese reforms, Vietnam, which was a rice importer before the reforms, became the third largest rice exporter in the world in 1989.

However, the supply of input goods such as fertilizers or farm appliances does not keep up with the increase of the demand for these goods. These input goods are produced by state enterprises, and the delay of the reforms in that field caused a poor response of supply of those goods. This poor supply of input goods, together with the weak agricultural