Vietnam has almost used up the achievements gained through its reform efforts in the last few decades, and will be left behind by other countries and face more challenges should it not start a new improvement drive, the Minister of Planning and Investment has warned.
The Southeast Asian country has made significant progress, but the positive impacts of its reforming attempts on the economy are dissipating, Minister Bui Quang Vinh told Tuoi Tre (Youth) newspaper in an interview published Thursday.
“The reality is that our development has already begun staggering in the last few years and we could even start falling if we are not cautious enough,” he said.
“It is obvious that if we keep moving as we currently do, and without any reform, Vietnam will face difficulties and lag behind [other economies].”
Vinh said his ministry has asked “hundreds of the world’s top experts,” including some Nobel laureates, to analyze Vietnam’s economic situation, and they agreed that Vietnam needs “more improvement, institutional reform and better market elements.”
“For instance, the land market in Vietnam is not really driven by market forces, as land allocation is still managed through administrative decisions,” he said.
“Once driven by the market, land plots will be given to those firms with the highest business effectiveness.”
Minister Vinh added that Vietnam’s labor market is facing the same problem.
“In a real labor market, talented people will be sought after,” he said.
“I can recruit an official today and fire him the following day for failing to work properly, but this is what we are currently unable to do.”
Author of liberal laws
Vinh, 63, was appointed Minister of Planning and Investment for a five-year term in August 2011.
One of his legacies is securing the ratification of the law on enterprises and the law on investment in 2014, which is said to help improve the Vietnamese business environment.
However, he admitted that red tape remains an issue, adding that all officials were born with bureaucracy so a single law cannot solve everything.
“Reform is still a long road ahead and we cannot expect every problem to be solved by only one regulation,” he said.
The minister added that he feels sorry for not being able to have a new law on planning approved by the government.
The law was proposed at a time when the waste caused by haphazardly planned projects across the country was estimated at VND8.2 trillion (US$366.07 million), but the government refused to pass it to the lawmaking National Assembly for ratification.
“The real waste could be thousands of times bigger than the estimated VND8.2 trillion,” he said.
“I am very sorry [that the law was not passed], but it was the best I could do.”
Minister Vinh also said the government’s drive to privatize state-run enterprises has not been as effective as expected, as it focuses on quantity more than quality.
“We are counting the number of state companies that have gone public, rather than considering the value of the state holdings sold to private investors,” he explained.
While hundreds of state-run enterprises have undergone the privatization process, the government still possesses up to 95 percent of the value of the state firms.
“With only five percent sold, there will be no change in terms of policy, mechanisms and operations in those firms.”
As the mastermind behind many progressive laws and policies, Vinh said he was certainly unable to avoid pressure or objections from others.
“But I could say I am loved more than hated,” he said, adding it is evidenced by the support his ministry received from many local administrations.
“Every locality has said they want my ministry to continue reforming the public investment sector,” he said.
Vinh said he hopes his successor will continue the reform efforts to benefit the country, referring to the end of his tenure later this year.
“I cannot choose a specific person to succeed me, but I believe the State and Party will find the one who will continue the reform process,” he said.
“There is one thing for sure: I will not stay on as minister.”