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Vietnam Reform and Development Forum held in Hanoi

Released at: 14:29, 20/09/2019

Vietnam Reform and Development Forum held in Hanoi

Photo: Ngoc Lan

Reform of market economy institutions among issues discussed at September 19 forum attended by PM.

by Ngoc Lan

The reform of market economy institutions was one of the issues discussed at the Vietnam Reform and Development Forum (VRDF) held in Hanoi on September 19 with the attendance of Prime Minister Nguyen Xuan Phuc.

Prime Minister Phuc emphasized Vietnam’s aspiration to develop a strong economy and underlined that over the past 30 years of reform its economy has achieved high growth, which was the foundation for the country bringing the poverty rate down from a high of over 53 per cent in 1992 to a mere 5.23 per cent in 2018. He went on to say that Vietnam is working on a development strategy for 2021-2030 amid unpredictable global developments, especially trade wars, protectionism, and climate change. “In such a context, Vietnam needs to maintain a peaceful environment along with political and social stability for rapid and sustainable development,” the Prime Minister said.

He agreed with international expert assessments about the limitations, shortcomings and hidden risks to Vietnam’s economy. Its resilience and adaptation to external impacts remain weak and its capacity to access the digital economy is still limited.

Minister of Planning and Investment Nguyen Chi Dung spoke of Vietnam’s recent achievements, including fine-tuning its socialist market-oriented economic institutions and promoting global integration. “Vietnam has become an attractive investment destination with a more open economy and a culture of innovation,” he said. “Still, it needs to see more initiatives to boost labor productivity and national competitiveness.” He also stressed innovation and reforms as keys to development and prosperity.

According to Mr. Ousmane Dione, Country Director for the World Bank in Vietnam, Vietnam’s economic model is also facing several domestic challenges, including but not limited to a rapidly-aging population, low capital formation and investment return, the degradation of its natural capital, and likely declining productivity gains. “So, while Vietnam has potential to sustain its development success, bold reforms are required so that the country will be able to seize future opportunities and manage risks,” he said. “For this reason, priorities and actions need to be clearly identified and be practical for implementation.”

Speakers expressed agreement that startups are an apt tool to commercialize technology but are currently facing difficulties as Vietnam’s venture capital market is not mature enough to support them with the resources they need. In addition, venture capital funds have strict rules on capital management as well as minimum investment levels for each company (usually a minimum $500,000) and most Vietnamese startups do not reach the required scale.

The VRDF this year was organized earlier than in previous years, with the aim of collecting opinions from domestic and international experts for the building of the socioeconomic development strategy in 2021-2030 as well as orientations and tasks for the five-year socioeconomic development plan in 2021-2025, which will be submitted to the eleventh meeting of the 12th Party Central Committee in October.

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