Sustainable development is defined as “a kind of development that meets the needs of the present without compromising the ability of future generations to meet their own needs”. However, putting that development into action requires the joint effort of all nations and, more specifically, the business community – the key driver of national sustainability. Viet Nam Chamber of Commerce and Industry (VCCI) Chairman Vu Tien Loc speaks to Viet Nam News reporter Nguyen Linh Anh about the role played by businesses in sustainability.
How do you assess the efforts of Viet Nam in the pursuit of sustainable development?
In 2015, 17 Sustainable Development Goals (SDGs) as part of the 2030 Agenda for Sustainable Development were adopted by leaders of 193 members of the United Nations, including Viet Nam. These aimed to ensure a better future, where nobody is left behind, and at the same time create a path for the next 15 years to end all forms of poverty, fight inequality, unfairness, preserve peace and protect our world.
After more than 30 years of economic reforms since the launch of Doi Moi (Renewal) in 1986, Viet Nam has recorded significant and historic achievements. From a poor, war-ravaged, centrally planned economy, which was closed off from much of the outside world, Viet Nam has become a middle-income country that is deeply integrated into the global economy. Viet Nam’s economic growth has not only been rapid, but also stable and inclusive, translating into strong welfare gains for the vast majority of the population. This is an impressive record of success, one that Vietnamese people take justifiable pride in, while appreciating the support of the international community.
In view of the development needs of the future, Viet Nam’s sustainable development and competitiveness depend on forging a resilient economy against shifting megatrends, as well as the development and deployment of various types of capital. There are four major trends exerting direct influence on sustainable development in Viet Nam: shifting trade patterns, the knowledge economy, climate change, and an aging population. Whether or not Viet Nam misses or embraces these major megatrends will determine its ability to achieve sustainable development.
Can you elaborate on the prominent efforts of the Government in the implementation of sustainable development goals?
The Government has enacted a National Action Plan on sustainable development and issued important resolutions on the improvement of the business environment and enhancement of national competitiveness. These include Resolution 19, which aims to turn Viet Nam into one of the four economies with the best institutional quality, competitiveness and business climate in the ASEAN region, at the same time trying to materialise the United Nation’s SGDs into specific action plans for ministries, localities and businesses. Sustainable development has become an indispensable path to economic growth, with businesses playing the central role.
Why do you emphasise the role of businesses? Can you elaborate on the relationship between businesses and sustainable development?
Businesses and sustainable development are intertwined, and businesses can embed their operations into the 2030 Agenda. From a business perspective, sustainable development is becoming a vital trend on a global scale, especially in a business world where long-term competitive advantages are no longer gained from natural resources-based and low-cost labour-based growth.
A sustainable business will help build a sustainable and prosperous society. In turn, sustainable development helps businesses to assert their positions and gain customer trust.
Businesses that choose the path of sustainable development are known to have a wide vision, opting for ethical practices and ensuring economic benefits in harmony with social-environmental ones. They, therefore, can win long-term growth and expansion instead of short-term profit. Above all, those businesses will then possess two critical kinds of “passport”, of which the first one is the legal recognition from the Government and the latter is the social appreciation as well as trust from customers, investors, partners and community in which they operate. With these special “passports”, their assets are no longer limited to capital, but can be strengthened by another kind of asset which is the trust in enterprises.
Sustainable development is thus the flesh and blood of businesses.
Why is competition a crucial factor for businesses in the pursuit of sustainable development?
Sustainable development is a process that meets all economic, social and environmental requirements, and when it comes to economic requirements, competition has to be mentioned.
Where there is a transparent, equitable competitive environment, social resources can be concentrated in the most effective areas, which helps improve the country’s competitiveness, creating more products and services to serve society at the lowest cost.
Sustainable competitiveness is also a trend that every business looks for. Sustainable advantage comes from creativity, pioneering and achievements of expectations and aspirations of customers and stakeholders. A business will always remain in a stable position and keep moving forward if it has a strong organisation where all members unite and work together to create sustainable advantages.
Within Southeast Asia, there is a gap between Viet Nam and the best performing countries in terms of competitiveness and business environment. What is your opinion on this phenomenon?
According to World Bank and World Economic Forum rankings, we have made tremendous efforts to improve our position. Last year, Viet Nam’s competitiveness index rose five places to 55 out of 137, the business environment increased 14 levels (increasing from 82 out of 190 economies to 68).
However in the ASEAN region, there is still a great gap between Viet Nam and the leading economies. For example, in terms of competitiveness, the fourth-rate economy in the top four economies in ASEAN ranks 36th in the global competitiveness index. Meanwhile we are ranked 55th, which means there are 19 more levels to catch up with the fourth economy in the ASEAN region. This shows that we need to make greater strides to promote competitiveness and improve the business environment.
Can you evaluate the importance of public-private partnerships in sustainable development? In which areas are public-private partnerships most effective?
Any of the 17 SDGs set out by the UN could be an important area for public-private partnership. Private-public partnerships are the key to success in the achievement of SDGs. For example, in poverty alleviation, decent work creation is the issue that shapes the policy framework of the government and at the same time requires the role of enterprises as job creation machines.
Besides, achieving all the SDGs requires a tremendous funding source. The Government itself can not provide such funding, thus strong support from the private sector is needed. It is the public-private partnership mechanism that will mobilise not only capital but also the private sector’s creativity in the achievement of sustainable development. — VNS