Three Hurdles Remaining on Economic Racecourse

The Vietnamese economy will be strong enough to compete with others if the country can overcome three remaining obstacles: substandard institutions at the local level, poor socioeconomic infrastructure and a general lack of skills, economists told a policy forum in Ha Noi last week. 

Although Viet Nam has abundant resources people-wide, there is still a noticeable lack of skilled workers and experienced managers

 According to their assessment, all sectors of the Vietnamese economy are thriving, and catching up with the region and the world in general. 

In their talks, the experts highlighted the stable growth of GPD, which averaged 7.5 percent in the 2001-2005 period and is tipped to reach 8.5 percent this year.

If this target is met, they opined, it will be because of Viet Nam’s success in changing its investment priorities.

Specifically, the proportion of investment capital allocated to the state sector fell from 59.1 percent in 2000 to 46.4 percent in 2006.

This year the amount of fresh capital flowing into the foreign-invested sector is estimated to make up 16.7 percent of the total.

Yet in the one year since Vietnam joined the WTO, they pointed out, it has failed to make any economic breakthrough or significant economic achievement, unlike what the pundits had anticipated. 

Still, the economy has overcome a number of obstacles that were curbing growth, especially restrictive and opaque laws and regulations, clumsy mechanisms, a lack of skills, and weak infrastructure.

The remaining hurdles, in the experts’ collective opinion, manifest themselves in unstable macroeconomic growth. The result is a monitoring system and a business environment that lag behind the country’s overall economic development.

Economist Le Dang Doanh pointed out that although Viet Nam has abundant resources people-wide, there is still a noticeable lack of skilled workers and experienced managers.

This translates into a failure by many provinces and districts to attract foreign-invested projects.

These shortcomings will continue to thwart Viet Nam’s attempts to get more investment into industries and sectors that need grey matter and professional skills, Dr. Doanh concluded.

By Nguyen Quan – Translated by Phuong Lan

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