Vietnam's Economy: Challenges from Sustainable Development and Successes in Integration
This was the topic of the talk of prestigious American Professor of Economics Joseph E.Stiglitz at the Ho Chi Minh City Economics University during his recent visit to Vietnam. The talk of the Nobel 2001 winner revolved around solutions to lead Vietnam's economy towards successful integration.
"Vietnam has been a typical example of high growth and success in poverty reduction programs over the past 15 years. Nevertheless, the important thing is how to sustain the development in economy, society and environment", he stressed. Vietnam is stepping onto a stage which poses great environmental requirements. At a higher stage, more attention will be put on non-garbage services. At present, the country's economy is laying strong impacts on the environment which is likely to become a disaster unless there are timely policies and solutions, he pointed out. Scientists have issued warnings over Vietnam's destruction of forests for the expansion of farms and shrimp raising, saying this is non-sustainable activity. The successful construction of modern cities requires outstanding planning as well as early development of green parks and public traffic systems.
Stiglitz pointed out three key factors for successful integration, including self-adjustment of the local economy in this fast changing global economy, implementation of commercialisation which should benefit the country, and the matter of negotiation.
In the next thirty years, nations will benefit from proper industrial development policies. China is coming to the first rank with outstanding advantages and other countries should find out their unique products to interact with and integrate in its economy, he said. The facts indicate that South Korea, after its crisis, is accelerating cooperation with China and is raking in significant results. Vietnam must find its key, special products and soon join the membership of the World Trade Organisation to be protected from unfair competition from huge nations. However, it should also be aware of other corollary issues such as in finance. The entrance of international banks will create a confidence among the public while local banks will have to face major difficulties, normally bad debt. Besides, some local banks are being instructed by the Government to save unprofitable companies, which leads to poor competitiveness.
To realise a beneficial commercialisation, Vietnam needs to diversify its economy and pay more attention to the efficiency in the structure of export items. It should aim to discover distinguishing features in the quality of the chain of products as well as in technology of production lines. A strategic alliance is crucial, he stressed. Vietnam, for instance, could enter into strong relations with Mexico and use this as a bridge to the US market. It should be aware that financial and credit services play a vital role in regional growth, he said.
Vietnam is able to successfully integrate in the global economy but this requires a thorough utilisation of opportunities, proper shifting of economic structure and dealing with integration challenges. Besides, a careful consideration in words in international trade pledges is very important, he said. Stiglitz pointed out the irrational decision of the U.S regarding Vietnam's basa fish lawsuit. The matter here is that the US does not accept the production cost that is included in the price of Vietnam-made basa, stating Vietnam's economy is non-market.
Stiglitz revealed that during his chairmanship of the White House's Economic Council, he had many times warned the US Government not to use conception of market and non-market economy but failed. The United States is a consistent country in the use of inconsistent policies, he assessed.
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