Japan's ODA has contributed actively to the process of socio-economic development of Viet Nam. — File Photo

HCM CITY (Biz Hub) — Viet Nam should strengthen its government machinery and develop the private sector to ensure more effective co-operation with Japan, economist Pham Chi Lan has said.

Speaking at a seminar titled "Viet Nam-Japan economic cooperation – actuality and prospect" in HCM City yesterday, she said Viet Nam lacked the "inner force" to take full advantage of its relationship with Japan.

For Viet Nam, Japan was an important strategic political and defence partner, the fourth biggest economic partner, largest foreign investor, and the top source of ODA (official development assistance).

Their bilateral co-operation could be described as "comprehensive" since they also co-operated in the fields of culture, education and training, science and technology, and environmental protection.

But Viet Nam had failed to take advantage of all this to export agricultural and aquatic products to that country.

"The shortcomings of Vietnamese agriculture mean its products cannot meet the requirements of the Japan market, which has strict quality standards."

When the Trans-Pacific Strategic Economic Partnership Agreement took effect, the resulting tariff cuts could see the share of domestic farm produce in the Japanese market decrease from 40 per cent now to 14 per cent.

Agriculture co-operation could benefit both sides, Lan said.

Japan could help Viet Nam cope with climate change, increase its productivity and add value to its agriculture.

Its companies could provide technologies and co-operate with their Vietnamese counterparts to develop high value-added products.

They could help Vietnamese firms access the Japanese market by taking their produce into distribution systems.

A Viet Nam-Japan Joint Initiative undertook many activities to develop supporting industries in Viet Nam, including training and financial assistance.

"But the result has been modest due to the low competitiveness of Vietnamese firms."

Japan also accounted for 30 per cent of the total ODA Viet Nam received, but the latter used the funds inefficiently.

Viet Nam ought to address this and stop using ODA within 15-20 years.

Lan is a member of the National Council for Sustainable Development and Competitiveness Enhancement and an advisor to the National Assembly's Economic Commission.

The seminar was held as part of the fifth Aureole Fair organised by Japan's Aureole-Mitani Group aimed at creating opportunities for Japanese firms in Viet Nam to meet and expand co-operation with their Vietnamese counterparts. — VNS