CAMBRIDGE, England -- Foreign investors have not been showing any confidence in Vietnam's Doi Moi (liberalization) program recently. Socialist market economics, Vietnamese-style, have not proved as attractive as the Chinese version. After the initial euphoria of the early 1990s, when foreign companies were almost falling over themselves to get a piece of the action, they are now more often found stumbling over each other as they head for the exit door.

The decline in foreign direct investment inflows began in 1996 -- i.e., before the Asian financial crisis. Of the $7.9 billion promised in 1996 only about one-third arrived. The average actual FDI, as against that promised, was around $2 billion annually from 1995-1997, according to the World Bank. The Bank also estimates that actual FDI fell to $800 million in 1998 and $600 million in 1999. By the beginning of the new millennium, Vietnam was scrabbling to find foreigners willing to invest in the country.

The World Bank puts the decline in FDI in Vietnam down to two things. Other Asian countries have taken a more serious approach to economic reforms and introduced measures to make their economies more competitive. Second, the Vietnamese government has spent more time discussing problems, actually slowing the process of reform in Vietnam.