4  "Dirt Shack"
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Dr. Chu Van Thinh is the GDLA's number two, the deputy director. This office stands alone in terms of the country's political structure. It the supreme interpreter of how to apply socialist ideology to modern situations.

It happened that Thinh was also eager to discuss the subject of valuating property in today's Vietnam. Meeting he and Xa (who spoke for three hours) was illuminating because these men, powerful and in their sixties, seemed unafraid to openly lament the conundrums they were assigned to solve, even anxious to do so. Sympathetic and gregarious as they are, if power in Vietnam is unimaginably concentrated at the top, then it is these men who are required to summon the answers to the questions they have created

Unfortunately, then, Thinh wanted to talk about golf courses. The subject is more relevant than it sounds. He is responsible for arranging large tracts of land, which in Vietnam are non-existent, especially near urban areas, where one might want to build a factory, housing development or golf course.

He had just spent two years arranging the construction of a golf course outside of Hanoi to be built by the Korean conglomerate Daewoo (in joint venture with the government), which is one of Vietnam's largest foreign investors.

This was a landmark case. Two years earlier, on New Year's Day, the farmers who had been living on the allotted land revolted violently after disagreeing with the compensation process, which has come to include cash and a new place to live. They burned tractors. It stayed out of local papers, though it made the front page of the London Financial Times. The case became a top priority and finally, the same week of this interview, he announced the resolution of the case, following ongoing negotiations.

This time the press was invited to a ribbon-cutting ceremony, at which 90-hectares was turned over to the venture. Thinh was pleased that he was able to land the state-owned parcel peacefully. As a precedent, it was a mixed success at best.

While Thinh would not reveal the exact terms of the negotiation, rumor is that Daewoo was obliged to pay hundreds of thousands of extra dollars for what was supposed to be the local partner's contribution -- and that was for a fraction of the entire tract they need.

In its negotiation, Thinh found his office in a curious position. On the one hand, for negotiation purposes Thinh had to assess that the value of the land was low. On the other, it was crucial to place a high value on the land and buildings that were offered by the government as replacements.

It seemed that, at least in the one success that was offered by the government's senior policy-makers, the solution thus far has been to throw money at the problem. This strategy has increased inflation and giving real-estate entrepreneurs a whole new market (land the government wants).

For the time being, Thinh's office narrowly slipped passed the golf course crisis. But, upon exiting his office, one realized that for settling the big questions, there was nobody left to ask.

And now would be the moment to come up with the answers. Pressure has never been higher on this limited commodity. The country's population doubles every twenty years (1980: 30 million; 2020: est. 120 million) and all arable land is now spoken for.

It is safe to say that the government is counting on a single strategy to resolve this crisis -- expanding cities to accommodate relocated and future families. This year the Prime Minister approved a Hanoi growth masterplan that would accommodate the tripling of the capital’s population over the next 20 years, to 5 million.

Suburbanization, a process involves converting farmers’ land to urban property, has begun, and the government is negotiating this transformation with little more than cash,to buy land it legally owns already.

In December, Nguyen Than Binh, the head of Hanoi's planning and investment department, called a meeting of prominent American investors to the Metropole Hotel.

He explained that the recent upgrade of just a single (approximately two mile) stretch of a road north of Thanh Long Bridge, linking the city with its biggest suburb, cost the government about $14.3 million. More than half that -- $8.3 million -- went to relocating the residents, he said.

Binh went on to say that to convert outlying farmland to city suburbs would take $20 billion in 20 years. Predictably, he tried to interest some rich Americans. The meeting, which did not feature clear avenues of profit or even participation, seemed less than fruitful.

Even so, the city plods forward with its plan. The first trickles of land cash have already caused land prices beyond city limits to inflate, with dramatic effect.

For two years Fanny Quertamp and Olivier Chabert, French doctorate students, tracked the "suburbanization" of Hanoi, as far as Malaysia-invested Noi Bai Industrial Zone, near the airport, amidst rice paddies and villages.

There, they report, farmers are compensated up to $60 per "sau" (360 square meters), according to their crop, a windfall sum for farming families that is negotiated by the local people’s committee and can cost an investor millions.

But it also costs the farmers, whose lives are changed. Cleaners in the airport pay $400, in exchange for a job at which they earn VND400, 000 (about $30) monthly. Even a job secondary school teacher in Thanh Tri (near the airport) costs $600. Lotteries are held for local government jobs, with up to 100 applicants each paying hefty application fees.

They said that positions at the airport tax department, customs, and police, each perceived to be truly profitable, can cost thousands to win.

Through this way, the compensation money -- which channeled through the local people's committees -- washes throughout the area. Other officials and economists warily confirmed this process.

With every property transaction, the scale weighing against solving the socialist conundrum of creating order out of this wild market gets heavier. Warned MoF’s top ideologue Xa during his interview, "If the responsible offices don't (find a way to order the market), the state will lose its control over real-estate."

Many thousands are simply ignoring the government's hand, unaccustomed to it anyway, and are focusing instead on learning the illegal laws and softening the potholes with cash.

Alastair Orr-Ewing is targeting that group. The transplanted Britain is country manager for Chesterton International real-estate consultants, and a few months ago received the country’s first 100%-foreign owned real-estate company. While the firm initially put newcomers into office space, then and managed high-end buildings, now it perceives Vietnamese as the most attractive group of real-estate consumers, Orr-Ewing said. "Someday, we’ll have pictures of villas in the window. People will come by and say, ‘oh, that looks nice,’ and come through the door."

As for the government's weighty problems, perhaps its best chance is to read the local papers. Those report that a combination of new construction and the region's economic downturn has caused property prices to plummet. Thanks to this behavior by "Vietnam's only free market," if ideologues act quickly and buy now, they can save millions.