Vietnam must reform its economy: expert

In an interview with Tuoi Tre, Doctor Nguyen Dinh Cung, deputy head of the Central Institute for Economic Management, said Vietnam must reform its economy if it wants to develop further.

Cung said Vietnam’s sources for development for the last 25 years such as increased investment, cheap labour and natural resources are being used up.

“These sources can only help Vietnam reach its current level of development and we badly need an economic restructuring to develop further,” Cung said.

He said the National Assembly’s Economic Committee has asked the government to gradually reform the economy with such imperatives as boosting investment effectiveness and reforming state-owned enterprises.

Cung said using public investment effectively is particularly important.

“Since public spending always requires huge capital, a reform of it would help improve the business environment and economic effectiveness,” he said.

“The government should not invest in unnecessary and ineffective projects.”

Fairness for all

Cung said public enterprises are under no pressure to compete as they have been receiving too many special treatments from the government.

Public enterprises should thus be taken out of the government’s protection to face business risks and challenges as every private business has to, he said.

“A fair and equal government treatment means state-owned businesses can also go bankrupt like private enterprises, instead of being ‘rescued’ by the government whenever they are in trouble,” Cung said.

A reform of public enterprises would also give the private sector more chances to develop, as state-own enterprises have been using up most of the country’s natural resources and business opportunities.

He also urged the government to set economic reform as its top goal in the next five years and choose capable people to manage its reform work.

“The Economic Committee, or another government agency that has adequate authorisation, would operate, manage and evaluate the reforming process, to make sure we’re following the right track,” he said.

The 12th National Assembly’s Economic Committee has submitted a 10-petition plan to the newly elected National Assembly, suggesting that the economy must be restructured in a sustainable way in the next five years.

The petitions propose solutions to ensure sustainable economic growth such as stabilising macro-economy, giving better comparative advantages to the private sector, curbing trade deficits, reducing public spending, tightening fiscal policies, restructuring the public sector and the banking system, optimising foreign investment and prioritising development in agriculture.

 

Category: Economy