Urban poverty in Vietnam – a view from complementary assessments

This paper reviews how poverty is measured in Vietnam with a particular interest in how accurately it measures urban poverty. Poverty has been seen as a rural phenomenon in Vietnam and only recently, with rapid urbanisation, has attention been given to urban poverty. Two different approaches are used by the government to measure poverty; and applying these poverty lines, or the international US$1.25 a day poverty line, show a rapid fall in the proportion of the population defined as poor from the early 1990s to 2010. By 2010, the proportion of the urban population considered poor was between 6 and 7 per cent, depending on which of the two approaches were used.

However, many households have incomes very near these poverty lines and remain vulnerable to shocks and stresses. In addition, different poverty lines give different figures; there are concerns that monetary poverty lines are set too low in relation to the costs of living faced by low-income groups in urban areas, especially in the large cities; and that urban poverty statistics are not including many urban residents who have migrated to urban areas but are not registered as urban dwellers.

This paper reports on the findings of four studies that have sought to improve the basis for defining and measuring urban poverty. They show that poverty lines remain low in relation to living costs in urban areas - even with the raising of official poverty lines in 2010. There is also a concern that a focus on income or expenditure-based poverty lines misses many poverty-related deprivations. Assessing poverty based on multidimensional measurements highlights how the proportion of Vietnam’s urban population facing deprivations are higher than those defined as poor by official poverty lines.