VINACHEM

(VEN) - Vietnam will continue to boost industrialization and modernization and develop rapidly and in a sustainable way while making the most of national strength to become an industrialized, socialist-oriented country. This follows the Vietnam Socioeconomic Development Strategy for 2011-2020 adopted at the 11th Vietnam Communist Party Congress, which started on January 12, 2011 in Hanoi.

Vision and goals

According to the strategy, the Vietnamese economy will develop in 2010-2020 based on five standpoints: (1) develop rapidly and steadily, (2) renovate comprehensively with commensurate developments of the political system for the cause of building a strong socialist, democratic, equal and civilized country with wealthy people, (3) increase democracy, make the most of people, considering them the subject, a major force and the goal of development, (4) vibrantly develop production forces with a higher level of science and technology, while improving production relations and the socialist-oriented market-driven economic institution, and (5) consistently build an independent and highly self-controlled economy in the context of international integration in depth.

Vietnam expects to become a basic industrialized country by 2020, increase GDP by an average of 7-8 percent annually from now to 2020, or 2.2 times between 2010 and 2020 accounting for per capita GDP at US$3,000 in 2020 compared with US$1,168 in 2010. High-tech products will contribute about 45 percent of total GDP. Industrial manufactured products are expected to make up 40 percent of all industrial production. The general productivity factor will contribute 35 percent of the growth. Trained workers will present more than 70 percent of the workforce. Several areas such as science, technology, education-training, and health will meet international standards. The country will actively cope with natural calamities and climate change.

Improving institutions

Following the Economic Development Strategy for 2011-2020, Vietnam has identified three important breakthroughs. These are to (1) improve the socialist-oriented market-run economy institution with a focus on creating a fair competitive environment and reform administrative procedures (an important premise for boosting the process of economic restructuring, renewing the growth model and stabilizing the macro economy), (2) rapidly develop human resources, particularly high-quality manpower by fundamentally and comprehensively renewing the national education system and combining manpower development with science-technology application and (3) build a complete infrastructure system with several modern projects emphasizing transport and urban infrastructure in cities.

The market-run socialist-oriented economy in Vietnam is a multi-sector commodity economy, which is driven by the market, is managed by the state, and is led by the Vietnam Communist Party following socialist rules. The market mechanism must be in place in a comprehensive and flexible manner to make the most of every force. The country encourages people to enrich themselves in a legal way and concurrent with eradicating hunger and reducing poverty towards the goal of rich people, strong nation, democracy, equality and civilization. Economic sectors are important segments of the economy, are treated equally by the laws, and get together for long-term development, cooperation and fair competition. Of these, the state business sector plays a leading role. Vietnam will continue to actively integrate with the world, maintain economic independence and self-control, develop the economy in combination with culture-society development, progress and social equality in every step and every development policy, and apply a mechanism on distribution based on work results, economic efficiency, capital contribution and other sources of force. Distribution will also follow the social security/welfare system. It is also important to ensure the state's role in managing and regulating the economy through laws, mechanisms, policies, strategies, zoning plans and economic forces.

On this basis, Vietnam will (1) vibrantly develop forms of ownership, economic sectors and businesses, (2) improve the laws, mechanisms and policies on people's ownership (with the state representing people) of land, natural resources, capital and public properties so that these resources are managed and utilized effectively, (3) boost renovation, equitization (i.e. transformation of state-owned enterprises to joint stock companies) and improve the effective use of state-run businesses, (4) create several large multi-owned business groups with the state playing the ruling role, (5) restructure business lines of economic groups and state-owned corporations to make state-owned businesses a mainstay of the state economic sector, (6) robustly develop the collective economy with cooperatives being the core, (7) encourage the development of the private business sector and multi-owned businesses following the zoning plans and the laws and (8) attract foreign investors with modern and environmentally friendly technology.

At the same time, the country needs to (1) attract foreign investment with new, environmentally-friendly technology, (2) comprehensively develop market factors and various kinds of market, (3) develop a wide range of modern commodity/service markets, (4) steadily develop the financial market through a complete structure that runs safely and is managed effectively, (5) develop and effectively control the securities market, (6) develop a fair market for real estate focusing on renewing and improving institutions on land use rights and (7) drastically develop the science-technology market together with protecting intellectual property.

On the other hand, the country will (1) improve the party’s leadership and the state’s management of the market-run socialist-oriented economy, (2) continue renewing economic thinking, build capacity of party organizations in economic leadership, improve the quality of consultation in drawing up, directing and examining the enforcement of socioeconomic development policies, (3) renew and improve the state’s role and economic management, (4) improve the law system to ensure fair, transparent competition among all economic sectors, (5) renew planning and economic management to match the market-driven mechanism, (6) continue to improve tax policies, price management mechanisms and salary/wage policies and (7) effectively distribute and use the State Budget.

Renewing the growth model

Apart from improving the economic institution, Vietnam will also (1) renew the growth model, restructure the economy, boost industrialization and modernization and develop rapidly and in a sustainable way (the growth model will be modified by changing from wide development to proper development in depth and width), (2) expand the economic scale while improving the quality, efficiency and sustainability of economic development, (3) shift from the growth, which is based on increasing investment capital, exploiting natural resources and using cheap labor, to another growth, which is based on applying science-technology advances, using high-quality manpower, increasing productivity and product quality, and developing industry, agriculture, high-tech services that have added value, are highly competitive and are related to the development of an intellectual-based economy and (4) combine economic development with social progress/equality and environmental protection.

Under this direction, Vietnam will first (1) modernize industry and construction and continue to create a foundation for an industrialized country and increase economic independence and self-control, (2) prioritize the development of products with comparative advantage in the areas of high-tech industry, mechanical engineering, processing, energy, metallurgy, chemicals, and information technology-communications and (3) strongly develop support industries and those facilitating agriculture and rural areas.

Second, the country will (1) comprehensively, effectively and sustainably develop agriculture in the direction of industrialization and modernization, (2) take advantage of tropical agriculture and solve problems for farmers, (3) apply advanced science-technology and develop large-scale commercial farming with high productivity, high quality and high profitability, (4) link production with processing and distribution and expand exports and (5) modernize and enrich rural areas and improve farmers' living standard and spirit.

Third, Vietnam will intensively develop services, particularly those with high added value, large potential and high competitiveness such as finance, banking, commerce, tourism, telecommunications, transport, health, education, and science-technology, while at the same time set up several large service centers including region and world class centers throughout Vietnam.

Fourth, the country will create breakthroughs in infrastructure, improve planning of the national infrastructure system, develop sources of construction, improve major transport networks, modernize several major airports and seaports, and progressively modernize irrigation systems, and build/strengthen sea dike systems, flood prevention projects, safe water supply systems and waste water treatment facilities.

Finally, Vietnam will harmonize the development in urban and rural areas, develop key economic zones to create an economic engine, support the development in needy areas, properly form urban systems in regions, and harmoniously develop cities and rural areas./.