Prime Minister Nguyen Xuan Phuc on Thursday characterised sustainable development as a “marathon race” that needs stable, inclusive growth.

Addressing the 2018 Vietnam Economic Forum held in Ha Noi, he stressed the need to address many medium and long-term terms that the Vietnamese economy was facing in order to avoid the middle income trap.

Phuc said that the nation’s most important objective in the coming years was to “grow quickly but surely.”

“Sustainable development is a marathon, not a short distance race,” he said.

He said aspirations should be pursued with durable, concrete actions, taking advantage of opportunities and overcoming challenges, as the country strove to become a “new Asian economic tiger.”

The PM noted Viet Nam’s impressive economic achievements in 2017, including a higher than expected GDP growth rate of 6.81 per cent and inflation kept within the annual target.

He expected these successes to be sustained in 2018 in the context of further international economic integration, with many free trade agreements being implemented, tariffs on many competitive imported goods removed, and the possibility of growing public debt.

Renewable energy

Agreeing with PM Phuc, Nguyen Van Binh, head of the Central Economic Commission (CEC), said that an important factor and driving force for industrialisation and economic development would be clean and sustainable energy.

On its way to becoming a modern industrialised country, Viet Nam must focus on a number of sectors with comparative advantages and strategic significance, and the green energy industry carried high potential and was of fundamental importance, Binh said.

At present, the vision of renewable energy in Viet Nam has developed synchronously. The energy market has taken new steps to operate under market mechanisms, ensuring competitiveness, transparency and efficiency, Binh added.

This view was further supported by Former US Secretary of State John Kerry, who advised against the use of fossil fuels such as coal or petroleum.

“In order for Viet Nam, as any other country, to decrease greenhouse effects of climate change, the research and introduction via policy mechanisms of alternative and more economical renewable energy sources such as wind, solar, thermal electricity or biomass is indispensable,” Kerry said.

It was undeniable that Viet Nam’s socio-economic development would keep increasing the demand for energy, so the energy system must diversify in parallel with national infrastructure development to promote energy savings and efficiency, he said.

Productivity prospects

On international economic integration, improving productivity in the context of industrialisation was also a topic discussed at the forum.

“Productivity is a key determinant of economic development, especially considering that the national productivity level is low compared to the other countries in the region and the world average,” said Ngo Van Tuan, deputy head of the CEC.

He found it “saddening that Viet Nam’s labour productivity was only equivalent to 7 per cent of Singapore’s, 17.6 per cent of Malaysia’s, 36 per cent of Thailand’s and even just 87 per cent of Laos’.

Despite Viet Nam’s high GDP growth that meets the needs of socio-economic development, Tuan pointed out some policy flaws that he said were rooted in “lack of practical requirements, resources and timeliness”.

In the same vein, Umeda Kunio, Ambassador Extraordinary and Plenipotentiary of Japan to Viet Nam, said that increasing productivity was a key factor in strengthening Viet Nam’s industries.

“We can see that the 4.0 industrial revolution is creating opportunities and challenges for productivity breakthroughs based on innovation and technology. For rapid and sustainable growth, Viet Nam needs to identify medium and long-term strategies to promote productivity,” he said.

He also affirmed that the country’s movement to promote and launch productivity increasing initiatives has been recognised throughout the Vietnamese business community.

Viet Nam will not only focus on increasing the private sector’s capacity but also the Government’s and State-owned enterprises’ productivity, said Binh.

“By coordinating and reforming policies, administrative procedures, and improving the performance of State-owned enterprises, Viet Nam’s productivity will gradually increase,” he said.

Continuing the success of the first VEF last year, this year’s forum gathered more than 1,500 participants, including leading voices from the Government, economists, business representatives and international experts.

It was co-organised by the CEC in co-operation with governmental ministries, the Australian Embassy, the Japanese Embassy, the Konrad-Adeneur-Stiftung Institute and USAID in Viet Nam. — VNS