Major Challenge for Vietnamese Industry to Keep Stable Growth
Vietnam is drafting another five-year plan of socio-economic development for 2006-2010. A major challenge is to continue the stable growth with ever higher competitiveness to achieve the objective of industrialisation by 2010.
Speaking at the seminar "Increasing the competitiveness of Vietnamese industries in preparation for the five-year plan of socio-economic development from 2006-2010" organised in Hanoi on November 11, 2004, Dr. Kenichi Ohno, Japanese expert of the Vietnam Development Forum said that Vietnamese industry policy is becoming more outdated in the rapid evolution of international integration. There must be a significant reform to attain the target of becoming an industrialised country by 2010 and the successful implementation of the five-year plan and 10-year strategy.
For his part, the representative of the Japanese Embassy in Vietnam pointed out that the market decides the result. The policy planning must not intervene directly or too deeply in economic activities but rather influence indirectly or just promote economic activities. It is equally important to identify spearhead sectors in the context of regional and world integration and competition. Vietnam may consider such sectors as motorbike, electronics, software, textile and garment, footwear and food processing.
In the framework of the Vietnam-Japan joint action programme for increasing the competitiveness of Vietnamese industries, the Japanese Embassy has made some contribution. Vietnam should review the planning process. In the past, the plan mainly set out objectives in production volume, investment, capacity, domestic purchase for the national economy and each sector. The government should now assist the enterprises in capacity building and let the market decide the winner.
Considering the comparative edge of Vietnamese industry in the division of labour in Asia, Prof. Tran Van Tho, Waseda College of Economics, Tokyo, a member of the Prime Minister’s Research Committee, said that the combination of production factors, technology and managerial knowledge will create a comparative edge. In addition, Vietnam is rich in natural resources and located in a dynamic region, the advantages will be heightened in the competition.
As a matter of fact, the least developed countries must integrate into the world economy quickly and completely. The protection of local enterprises by high tax rates is no longer acceptable. As Vietnam is still new to this integration process, it lacks foreign direct investment (FDI), supporting industries and technology. Dr. Kenichi Ohno believes that Vietnam must become a part of the regional network, without industrialising itself alone. The co-operation with FDI to increase global competition must also be strengthened.
Vietnamese
