Soldiers who humbled US have little to celebrate

years after victory, Vietnam passes from poverty to decadence, writes Tim McGirk in Ho Chi Minh City

Once a victorious Vietnamese war veteran, the driver lay collapsed with fatigue on his cyclo-rickshaw on a darkened street corner in Ho Chi Minh City. His legs seemed nearly as thin as the spokes, and he dangled over his contraption like something broken. As he dozed, prostitutes cruised by on Honda scooters, their beautiful white-powdered faces as impassive as masks.

Nguyen Tron, had to pedal more than a mile to earn 15p, while the Honda-girls offered rides that were quicker and considerably more expensive. Thousands of former soldiers, demobilised after Vietnam's disastrous expedition into Cambodia ended in 1991 are trying to earn a living in the former Saigon as cyclo-drivers. It has been a tough ride. Fed during the 30-year liberation war, first against the French then the Americans, on a diet of Communism and sacrifice, few revolutionaries who took part in the capture of Saigon on 30 April 1975 could predict how Westernised - and decadent - the city would become.

Today, the US dollar is accepted as readily as the dong. Corruption and black marketeering are rife. Teenagers jam discos with names like Planet Saigon instead of political consciousness raising seminars at the Youth Hall. And, most astonishing of all to many veterans, Hanoi has quietly handed backthe keys to the US embassy.

For Americans, photographs of the last evacuation helicopter lifting off its roof, as thousands screamed to climb on board, became a lasting symbol of US humiliation in Vietnam.

City officials were unwilling to discuss the embassy's return, but a few crippled veterans selling postcards outside the derelict, shell-marked building seemed to know it all. "They'll start tearing it down in July," one woman in a wheelchair said. "Too many bad memories for Americans. Too many ghosts.''

After the Clinton administration lifted the trade embargo in February 1994, the two governments opened liaison offices in each other's capitals. They may resume diplomatic ties within the next year.Each sees the other as a potential ally against China. US firms are also anxious to cash in on Vietnam's fast-growing economy.

Bao Ninh, a Hanoi writer who took part in Saigon's capture 20 years ago, recalled: "I was elated. I felt we could all sleep soundly at last." But the tranquillity was short-lived. The transition in Ho Chi Minh City was especially traumatic. The city and, indeed most of South Vietnam, was geared to catering to the needs of the 400,000 US troops, doing their laundry, giving them sex, drugs and cold beer. "When the war ended, we had 100,000 prostitutes in the city, and another 200,000 people who were either drug addicts or disabled," Nguyen Son, from the mayor's office, said.

Thousands of South Vietnamese officers were banished to a harsh life in "re-education camps" and many languished there until after 1991. Factories and farms were collectivised in 1978, often by useless peons, and university professors were selected for Communist fervour rather than brains. Rice crops failed year after year, people starved and, in 1978, China briefly invaded. Nguyen Phoc Dai, a lawyer, said: "It was as if we'd chosen a narrow road with precipices on both sides, and with no room to turn around.''

In 1986, the Communist leadership did make a U-turn. The persecution eased against civil servants of the old regime, and their expertise was sought. With the fall of the Soviet Union, Hanoi's Communists hunted for other models. They fell back on Confucianism, with its emphasis on a return to tradition to restore the yin and the yang balance of universal forces. As Ho Ngoc Nhuan, a journalist, explained: "You worship and obey your father, the village headman, and on top of him, the President, the father of the nation."

For Hanoi, the best Confucian formula seemed that of Singapore's Lee Kuan Yew, whose authoritarian style and open economy had wrought miracles in the old British colony. In 1989, Vietnam opened its economy, and its growth rate last year rose to nearly 8 per cent.

Recovery is so far limited to Hanoi and Ho Chi Minh City, the rest of the country living in near poverty. With Ho Chi Minh City's economic growth rate running at 2.5 times the national average, the population has swelled from 3 million to more than 5 million. Its slums are as bad as Calcutta's.

Some Vietnamese say the yin-yang balance can only be achieved once the country's veteran leaders stop see-sawing between a regimented, state- run Communism and an open economy. Growing bureaucracy has discouraged foreign investors and allowed corruption to seep in.

As Ho Chi Minh City spruces up for its victory anniversary tomorrow, most banners feature happy workers striding off to factories. Veterans such as the cyclo-driver Nguyen Tron want a little more.

Asian earthquake, page 13

Hollywood's war, page 28