Hyper‐urbanization has been used in South Vietnam (1960‐74) as a strategic weapon to dominate and enslave the country. Since liberation in April 1975, the government has undertaken gradual but large‐scale de‐urbanization to create favourable conditions for development based on a policy of regional industrialization in support of agriculture. The experience of North Vietnam (1954‐75) has proved that it is possible to speed up industrialization and modernization in a poor country without precipitating an exodus from the countryside or huge urban concentrations. However, this policy of decentralized development has its own contradictions.