Hanoi is a captivating mix of ancient and modern, parochial and cosmopolitan, the spiritual and the pragmatic.

On any given street you’re likely to find a Buddhist temple, a French-style colonial mansion, a statue commemorating a Communist hero, a mobile-phone store, a silk merchant and an Internet cafe.

Giggling schoolchildren weave their bicycles through a sea of motorcycles, while women in bamboo hats balance baskets of fruit on shoulder poles and old men share newspapers and coffee at a footpath cafe.

The bitter struggles of the past have not been forgotten, but neither are they at the front of anyone’s mind.

With a young, optimistic population (more than 60 per cent are under 25) and serious money flowing in from foreign investors, Hanoi — which celebrates its millennium next year — is a vibrant, bustling city filled with proud locals and ever-increasing numbers of smitten tourists, writes Emily Maguire in a travelogue published in the Sydney Morning Herald.

There is, however, a down side. Most Vietnamese people live outside the major cities and half of them live below the poverty line. Hanoi, as the political and economic capital, is a magnet for young, rural people seeking education, work and adventure. Despite economic growth, tens of thousands of young people are living on the streets, selling sticks of chewing gum or postcards to tourists.

They’re often exploited by unscrupulous business owners and tour operators, or recruited into prostitution or drug dealing.

As a visitor, you don’t have to turn a blind eye to the poverty or smother your conscience. Armed with the right information, you can see the best sights, eat the best food and shop up a storm while improving the prospects of the city’s people.

With its labyrinthine Old Quarter, bizarre street-numbering system and heart-stopping traffic, Hanoi can be overwhelming to the first-time visitor. A great way to get your bearings is to organize a tour with Hanoikids (hanoikidsclub.org). The guides are enthusiastic university students who offer insider tours in exchange for the opportunity to practise their English. The service is free, but the guides will let you buy them lunch if you offer — and you should. Sharing a meal is the best way to learn the ins and outs of eating bun cha and pho the Vietnamese way.

Once you’ve mastered the art of slurping noodle soup while balanced on a tiny plastic stool, you can eat your way around Hanoi on a handful of change, supporting family businesses as you go. If you’re craving comfortable seats, air-conditioning and a Western-style menu, there are several great restaurants and cafes that help disadvantaged kids as they satisfy hungry foreigners.

KOTO (59 Van Mieu, opposite the Temple of Literature) is a welcoming four-storey restaurant serving a mix of authentic Vietnamese and cafe-style Western dishes. The staff are graduates of the KOTO training program, which takes on a class of poor 16- to 22-year-olds every six months. Trainees are given vaccinations and health checks and are provided with a cash allowance, accommodation, food, health care and clothing for the duration of the two-year hospitality and English language training scheme.

At the other end of Van Mieu, near the Fine Arts Museum, is Cafe Smile (5 Van Mieu). Run by the Vietnamese charity Hoa Sua, which provides training and employment for disadvantaged young people, Cafe Smile serves cakes, pastries, sandwiches and the best croque monsieur outside Paris.

For the full fine-dining experience, head to the Hoa Sua Training Restaurant (28A Ha Hoi). It’s in a restored French-colonial mansion decorated with black and white photos of old Hanoi and serves French and modern-Vietnamese cuisine. If you fancy the hand-embroidered napkins, tablecloths and curtains made by hearing-impaired youngsters, you can scoot down the road and buy some at the Chef Collection shop (21D Ha Hoi).

A visit to the Museum of Ethnology will likely leave you thinking about the many Vietnamese people who live far from the cities and way below the poverty line.

Craft Link, an organization formed to help struggling rural folks, pays fair prices to traditional craftspeople and artists and then re-invests the profits back into their communities. There’s a small store at the museum, but for the true Craft Link experience there are two stores in Van Mieu crammed with unique, reasonably priced items including traditional laquerware and home furnishings, handmade bags, clothes and wall hangings.