Packed shops, traffic chaos and kumquat trees everywhere can only mean one thing in Hanoi: a new lunar year is approaching. But not everybody is feeling festive.
Known locally as Tet, the celebration of the Lunar New Year is Vietnam’s most important holiday and triggers a surge in consumption and travel ahead of an extended nationwide shutdown.
But this year, critics are arguing that the beloved, protracted Tet holiday is actually hurting the already fragile economy.
“The long holiday and low productivity for weeks around Tet is causing problems for Vietnam’s development,” prominent economist Pham Chi Lan was quoted in a controversial interview in the state-run DanViet paper.
“It’s difficult to get anything done as there is no mood for work in many [state] agencies,” she said, suggesting the government could have one short public holiday to mark both calendar new year and Tet which would improve growth and attract more foreign investment.
Tet, which begins on Friday, is officially a five-day public holiday with two ‘substitution days’ where employees must work one Saturday in lieu.
Including the weekend, the government this year gave state employees nine days off, schools are shut for at least two weeks, hospitals are closed and cities become eerily empty as the country grinds to a near-total halt.
“Vietnam is trying to integrate into the global economy and the annual breakdown over Tet adds inefficiencies to the economy and government decision-making,” said Vietnam expert Carl Thayer.
Tet is a sacred tradition in Vietnam, where Confucian social mores still dominate, and involves many time consuming rituals – giving gifts and red envelops of cash, cleaning and decorating homes with kumquat trees and peach blossom and cooking elaborate feasts for family and friends.
Offerings must be made to respected ancestors and household spirits, and after the New Year itself – which this year begins on Friday – people often visit temples and pagodas.
Such practices have grown in popularity over the last few decades after market reforms in the early 1990s brought greater economic prosperity and the government relaxed once-strict controls over practicing traditional rituals.
‘Not suitable for the modern economy’
But the frenzy of consumerism that has emerged around Tet is not a good thing, laywer Tran Dinh Thu wrote in the popular Vietweekly newspaper.
“Tet is not suitable for the modern economy,” he said, pointing out that Vietnam was a middle-income country experiencing a protracted economic crisis with an average wage of just US$63 a month.
The country is struggling with a host of economic woes, including a banking sector weighed down with high levels of toxic debt and record numbers of bankruptcies.
The economy grew 5.43 per cent last year, picking up speed slightly after its worst performance in more than a decade in 2012.
“Many people have already gone deep into debt with their Tet spending,” Thu said.
For days before the official holiday begins, business people are expected to visit key clients and partners with gifts, said Tran Manh Cuong, director of engineering company BTES.
Cuong said he had to pay “disturbing” amounts to get his staff to work overtime and keep business going over the holiday – and he struggled to explain the delays and extra expense to his Japanese clients.
“A shorter Tet holiday might be better,” Cuong added.
Politically strategic holiday?
For the government, the extended break “aims to facilitate travelling and the enjoyment of Tet rituals with families”, according to an official statement.
But Jonathan London of the Department of Asian and International Studies at City University of Hong Kong said the long holiday could help shore up support for the country’s unpopular rulers.
The long holiday for state employees is partially “a reflection of the corporatist politics of Vietnam, in which state workers of all stripes are a key political constituency”, he said.
Thayer said he suspected that “this year’s prolonged break is designed to take some of the edge off public disenchantment with the government.”
There are no official estimates of the cost to the country’s economy.
But Vietnam has only 10 days of public holiday per year, compared to neighbouring Cambodia with 27 days, Thailand with 14 days, and China with 11 plus five ‘substitution’ days.
Besides, Tet supporters say, the holiday is a key part of the Vietnamese identity and must be preserved at all costs.
“Tet is for the Vietnamese. I am not rich [but] I’m not going to get richer or more productive without Tet,” 39-year-old Nguyen Ngoc Lam, a motorbike taxi driver said.