The Communist Party of Vietnam (CPV), which established Southeast Asia's first of socialism in 1945, is facing unprecedented challenges to its monopoly of power. Unlike previous times, when the main threat was posed by foreign milit ary intervention, the threat today is mainly political and is being mounted by domestic forces which are directly questioning the legitimacy of one-party rule. Also, unlike previous times, the CPV can no longer count on support from the socialist community headed by the Soviet Union. The socialist community, as indeed the Soviet Union itself, no longer exists. Vietnam, in fact, is an economic ally backward, isolated outpost of socialism. The prime challenge facing Vietnam's Communist leaders is how to break out of their isolation, and guide Vietnam into the economic and political mainstream of Asia and the Pacific without triggering chaos and political instability and perhaps their own fall from power. Over the last five years Vietnam's leaders have shown themselves to be creative and flexible in dealing with the myriad of challenges facing them. In 1986 the CPV boldly adopted a reform package ? known as dot moi (or renovation). In essence, Vietnam moved to dismantle the system of bureaucratic centralism, cen tral planning and state subsidies, and to replace it with a multi-sectoral commodity economy. The previous two-sector economy (state and collective) was expanded to include state capitalist, private capitalist and individual ownership of the means of production. Vietnam also adopted a relatively liberal foreign investment code and threw open its doors to non-socialist countries. In the short space of five years, the state and collective share of Gross Domestic Product has fallen to 40 per cent. The Soviet Union has been overtaken as Vietnam's largest trading partner, investor and aid donor by Japan, Taiwan, Sweden, France, Australia and West Germany. Perhaps Vietnam's greatest achievement has been to harness the productive energies of its peasant farmers. Vietnam no longer suffers from a chronic food shortage. In 1989-90 it achieved self-sufficiency and began exporting some of its rice surplus. Vietnam's attempts at political reform have not been so dramatic. In 1986, the CPV also committed itself to dot mot in the political sphere, or democratization. This took several forms. First and foremost, democratization entailed renovating the party itself. In 1987, a party purification campaign was launched. By the end of 1990, 127,800 members had been disciplined and another 78,200 were expelled. Second, attempts were made to revitalize the Vietnam Fatherland Front and its constituents, the mass organizations for trade unions, the peasantry, women, youth