The French colonial regime in Vietnam caused a fundamental transformation of Vietnamese society. Notably, the traditional rural economy was forcefully transformed to follow a capitalist model. Subsequently, deep divisions between a privileged minority of affluent landowners and a destitute majority of peasant cultivators emerged. Correspondingly, urban and rural life underwent increasingly divergent developments.
Throughout the rural areas in Vietnam, French authorities employed land redistribution policy as a sort of political tool. As a result, two distinct social strata emerged: landowners who controlled terra firma and financial resources; and predominantly landless tenants. Accordingly, these two strata became increasingly disconnected in terms of wealth distribution and way of life. For Vietnams new pro-French elite, colonial transformation marked an abrupt departure from the past, from the traditional way of life and millennial spiritual values. It was a potentially explosive development since it was sowing the seeds of violent conflict between rural traditionalism and urban pro-Western modernism.
It might be argued that the development of South Vietnam in the period of colonial rule, that is, from about the middle of the nineteenth century until World War II, was largely dominated by two factors. The first of these was the fundamental resistance of the great majority of the populace of the region to the changes, which the alien French economic and administrative structure was bringing about in their way of life. This resistance expressed itself in a growing hostility towards French rule, largely passive, but marked by occasional outbreaks of violent revolt, whose suppression increased the resentment causing them. The second was the steadily deteriorating economic conditions of the indigenous population due to the alien nature of the economic system imposed upon them, to which few managed to adapt themselves.
Of even greater importance than the factors mentioned above, however, was the increasing psychological uneasiness of alien rule. For the Vietnamese population as a whole, French rule entailed the erosion, rather sudden than gradual, of their traditional way of life, with nothing to take its place.
In the wake of the French departure from Vietnam in 1955, these divisions remained largely unchanged. Members of the Communist elite in the North as well as Southern elites before 1975 mainly originated from privileged classes of the colonial era. It might be argued that the deep social, cultural and spiritual divisions mentioned above are likely to have long-term influences over further development of the Vietnamese society.