The Hoa, or ethnic Chinese, are predominantly urban dwellers. A few Hoa live in small settlements in the northern highlands near the Chinese frontier, where they are also known as ngai. Traditionally, as elsewhere in Southeast Asia, the Chinese have retained a distinctive cultural identity, but in 1955 North Vietnam and China agreed that the Hoa should be integrated gradually into Vietnamese society and should have Vietnamese citizenship conferred on them.

Before 1975 the northern Hoa were mainly rice farmers, fishermen, and coal miners, except for those residing in cities and provincial towns. In the South they were dominant in commerce and manufacturing. According to an official source, at the end of 1974 the Hoa controlled more than 80 percent of the food, textile, chemical, metallurgy, engineering, and electrical industries, 100 percent of wholesale trade, more than 50 percent of retail trade, and 90 percent of export-import trade. Dominance over the economy enabled the Hoa to "manipulate prices" of rice and other scarce goods. This particular source further observed that the Hoa community constituted "a state within a state," inasmuch as they had built "a closed world based on blood relations, strict internal discipline, and a network of sects, each with its own chief, to avoid the indigenous administration's direct interference." It was noted by Hanoi in 1983 that as many as 60 percent of "the former bourgeoisie" of the south were of Chinese origin.

In mid-1975 the combined Hoa communities of the North and South numbered approximately 1.3 million, and all but 200,000 resided in the South, most of them in the Saigon metropolitan area. Beginning in 1975, the Hoa bore the brunt of socialist transformation in the South, especially after the communist government decided in early 1978 to abolish private trade. This, combined with external tensions stemming from Vietnam's dispute with Cambodia and China in 1978 and 1979 caused an exodus of about 250,000 Hoa, of whom 170,000 fled overland into China from the North and the remainder fled by boat from the South.


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