Workers hung red national flags and set out blue Pepsi machines Friday ahead of celebrations for the 30th anniversary of the Vietnam War's (search) end, but the prime minister warned against letting memories of victory overshadow the country's economic problems.

In Hanoi, Premier Phan Van Khai (search) cautioned against complacency at a ceremony presided over by a giant golden bust of founding father Ho Chi Minh (search) and included costumed dancers who re-enacted the war on stage, miming the downing of U.S. warplanes and weeping over fallen comrades.

"Our people's victory in the resistance against the Americans for national salvation is forever written in our nation's history as one of the most glorious pages," Khai told politicians and generals from Vietnam's communist regime and foreign dignitaries, including U.S. Ambassador Michael W. Marine.

But, Khai added, the Vietnamese face many challenges and must "avoid self-satisfaction, and realize the weaknesses and challenges posed to us."

"The economy has not developed to match up with potential, is weak in efficiency and competition," he said. "Compared with countries in the region, we are still behind and have not been able to narrow the gap on economic development and technology. The danger of lagging further remains a major challenge."

An increasingly free enterprise economy has benefited people in Hanoi and Ho Chi Minh City, but prosperity hasn't reached many others, particularly in rural areas. Worst off are the remote highlands of central and northern Vietnam where villagers eke out bare livings, with little access to health care or education.

Khai also spoke about reconciliation. "We advocate friendly cooperation to strengthen relations with countries that took part in the Vietnam War," he said.

"With our humanitarian spirit, we want to close the past and look to the future as regards those people who were in the other camp, whether they are in the country or abroad," he said. He referred to Vietnamese who fought for the former South Vietnam before the fall of its capital — Saigon, later renamed Ho Chi Minh City — on April 30, 1975.

The country's main celebration was set for Saturday on the streets of Ho Chi Minh City, which swarmed with workers all week putting up celebratory billboards, hanging Vietnam's red national flag with yellow star and building stages for performances. On Friday, workers hooked up soda machines along the route for Saturday's parade.

Authorities also began releasing prisoners across the country in a mass amnesty declared for the celebrations. Earlier in the week, officials said they would free a total of 7,820 inmates, including 16 political and religious dissidents who had been jailed for crimes against national security or causing social disorder.

Friday's ceremony in Hanoi focused on reminding Vietnamese of the sacrifices made in a decades-long struggle first against a colonial French regime and then U.S.-backed South Vietnam.

Among those at Ba Dinh Hall, home of the National Assembly, were Communist Party chief Nong Duc Manh, President Tran Duc Luong and the legendary Gen. Vo Nguyen Giap, who led communist forces during the long war.

During the decade of U.S. involvement, the war killed some 58,000 Americans and an estimated 3 million Vietnamese.

But the atmosphere three decades later is mostly festive. Memories of the war and its aftermath are little more than anecdotes in history books for the majority of the country's population that was born since communist tanks rolled into Saigon on a hot April day.

"I was born after the war so I only know it as part of history. But it was very important. It was the reunification of the country. It's a moment we can be proud of," said Ngo Thi Binh, 23, a student whose streaked hair is a hallmark of the postwar generation.

That sentiment was echoed by a worker helping with the last-minute touches along Le Duan Boulevard, where Saturday's main parade would pass the former Presidential Palace of South Vietnam.

"I was born the year the country was liberated," Tran Minh Thu Huong, 30, said as he put up posters. "I'm proud of the city, proud of Saigon."