Nguyen Viet Vuong^*

The 9^th National Party Congress pointed out the general objective for Vietnam’s socio-economic development strategy in the 2001-2010 period, which is, "To take our country out of the state of under-development, significantly increase the people’s physical, cultural and spiritual lives, and build a foundation to make our country an industrialised and modernised country by 2020." To realise this objective, it is very necessary to consistently renew and reform economic and social policies to suit each period. The close combination of economic and social policies will be a foundation to promote internal resources, unite the entire nation, and generate motivation and strength for rapid, effective and sustainable national development.

Social policies are a component of State policies to govern and resolve social issues. Social policies cover all aspects of life of all social members, from working, living, educational and cultural conditions to family, class and other social relations. Economic policies include economic guidelines and measures applied by the State in certain historical periods to obtain certain economic and political targets. A policy can be strategic and long-term and can also be tactical and short-term. An economic policy is developed, based on analyses and predictions of national resources and potential and social development trends.

Vietnam’s current economic policy is aimed at building a multi-sector commodity economy, which is operating by the market mechanism and governed by the State, and has a logical industrial, agricultural and servicing structure in order to liberalise existing productive forces, broaden international economic cooperation, and develop the national economy towards industrialisation and modernisation.

Economic and social policies are macro regulating and governing tools of the State, which impact on the entire socio-economic life of each nation. Through economic and social policies, the State can realise its major functions including:

- Making the economy more effective: A market economy might be less effective, and even eliminated by the impact of private economic forces. So, the State can and should intervene to make the economy more effective, for example, by issuing the Anti-monopoly Law, Anti-dumping Law, measures to support small and medium-sized enterprises, and the Law on Protecting private ownership.

- Securing social fairness: The State secures social fairness through policies on re-distributing national revenue, for example, applying the progressive income tax, and building an income supportive system to assist the elderly and people with disabilities, and provide unemployment and health insurance.

- Ensuring socio-economic stabilisation: Using fiscal and monetary policies to influence production output, employment and inflation and to reduce negative impacts in economic movements.

Experiences from many countries show that many social issues often emerge in the economic development process. They include unemployment, polarisation of the rich and the poor, bio-ecological imbalances, hard-to-cure diseases and changes in moral and spiritual values. From a modern viewpoint, sustainable development is not only based on economic achievements, but also indicators related to education, health, human and science and technology development, poverty reduction, and environmental protection. That is why, in addition to economic policies, social policies play the role of a regulator, which brings a good life, fairness and democracy to every social member.

Economic and social policies are two different categories. However, they are connected to each other with interactive and unified relations. Consistency between economic and social policies is necessary for national stabilisation and development. Economic development is a physical condition to realise social policies and vice-versa. Social stability, fairness and progress obtained through social policies creates a strong motivation to realise economic objectives and build a rich people, strong country and a fair, democratic and civilised society.

Economic and social policies are all aimed at the socio-economic development of each nation. To clarify the relationship between these two policy categories is in fact to clarify social objectives in economic policies and economic conditions that impact on the implementation of social policies. This is also the relationship between economic growth and social equity. Harmony and consistency between economic and social policies secures rapid, strong and sustainable economic development, but should not impact on the realisation of social fairness, or enlarge the gap between the rich and the poor, and neither cause social instability or damage to the eco-environment.

Economic growth cannot resolve all social issues, because under the impact of economic rules, economic policies cannot cover all complicated social issues. That is why separate social policies and programmes are required to resolve specific social issues, which emerge in certain periods as impacted by the negative aspects of the market economy. Social policies and programmes should be implemented simultaneously or integrated in economic policies to create a combined strength for national development.

Studying the relationship between economic and social policies also provides us with a foundation to find the boundary between these two categories of policies. However, this is a very complicated and hard question. It is important to conduct analyses to correctly evaluate the positive impacts or negative results of policies in order to work out control or promote other measures. For example, mistakes in an economic policies can be overcome after certain production periods. Meanwhile, mistakes in social policies can have long-term consequences. If a social policy fails to take the country’s economic capacity into account, or fails to pay attention to economic interests, it may become an obstacle to economic growth.

Experiences from many countries show that if social policies follow economic policies, economic objectives will dominate and sustainable development cannot be achieved. Likewise, if social policies determine economic policies, they are likely to fall into subjectivity and voluntariness. Social policies might then sound interesting but not be feasible and policy makers will not have enough conditions to realise them. Finally, good policies can become empty promises and leaders will lose the people’s trust. The correct choice is to combine economic growth with social progress and fairness from the beginning. This affirms that a correct combination between economic and social policies is necessary in the process of defining long-term and strategic directions and objectives, or developing institutions and laws.

Economic policies and social policies are a dialectical and unified state, relying and binding each other. The best combination between economic and social policies can accelerate economic growth and social progress. Principles for such a combination comprise economic policies that create a motivation for society and secure social stability. Meanwhile, social policies should accelerate economic development, be suited to the current economic situation, and impose new challenges towards sustainable development.

In order to build a prosperous, fair, democratic and civilised Vietnam, the 9^th National Party Congress worked out a socio-economic development strategy for the 2001-2010 period by accelerating the socialist-oriented industrialisation and modernisation process, and building the foundation to make Vietnam a modernised and industrialised country by 2020. Socio-economic objectives were set for this period such as: accelerating the industrialisation and modernisation process; building an independent and sovereign economy; making Vietnam an industrialised country; giving priority to the development of productive forces while building and realising productive relations with a socialist orientation; promoting internal resources while making the most of external resources and taking the initiative in international economic integration for rapid, effective and sustainable development; combining economic growth with economic development and gradually improving the people’s physical and spiritual lives, realising social progress and equity, and protecting the improving the environment; and combining socio-economic development with strengthening national defence and security.

In order to reach these strategic objectives, our Party particularly emphasises the making, amending and redressing of economic and social policies, considering the logical integration and combination of these policies as a guarantee for success. Economic policies must focus on the following major tasks.

- Further and consistently realising multi-sector, socialist-oriented economic policies to create favourable conditions for businesses and citizens in investment, production and business.

- Focusing on amendments and supplements to laws, policies and mechanisms and renewing the implementation of legal documents to ensure the long-term development of all economic sectors, and their cooperation and healthy competition to make them a real component of the socialist-oriented market economy.

- Further implementing open-door and international economic integration policies, and actively preparing economic, institutional and personnel conditions for successful integration based on promoting internal resources and securing independence, sovereignty, and equity and mutual benefits.

Social policies should be realised simultaneously and should focus on renewing the policy to train, use and treat intellectuals and talented people; using and promoting the intellectual potential of overseas Vietnamese; renewing financial mechanisms and policies on education and training to attract internal and external resources; encouraging all economic sectors to invest in education development at all levels; and adopting appropriate policies to create fair opportunities and responsibilities for all citizens, businesses and investors in productive and business activities, employment and self-employment and access to economic and market information. The State should encourage and reward people who enrich themselves in a decent way while fighting against corruption and trade fraud and reforming the salary system. People’s incomes should be made public, the gap between the rich and the poor should be bridged through income regulating measures, and social insurance and guarantee mechanisms should be reformed. The State should issue the Social Insurance Law, and implement effective measures to prevent social evils, particularly drug abuse and traffic accidents. Supervising contents, mechanisms and the methods of agencies, mass organisations and people involved in the implementation of State laws and policies should be made public, and democratic regulations at grassroots level should be realised.

The reality in Vietnam from the beginning of the 1990s has shown that by accelerating the development of the socialist-oriented market economy, the implementation of socio-economic policies has been able to obtain positive results. The national economy has made new progress in the development of productive forces, productive relations and international economic integration. GDP has increased, and the people’s physical, spiritual and cultural lives have obviously improved. The country has become more independent and sovereign to accelerate the industrialisation and modernisation process. However, in addition to progress, many weaknesses remain.

- The economy is less effective and competitive. Domestic accumulation and purchasing power is low. The economic restructuring process related to industrialisation and modernisation is taking place slowly. Investment structures remain irrational and a lot of State investment is lost and waste. Foreign direct investment is unstable. Some productive relations are not relevant, which prevents their liberalisation and development. The renewal and development of State-owned enterprises have seen no changes. The collective economy develops slowly. Other economic sectors fail to promote their full capacity. Distribution mechanisms and policies are somewhat illogical and the gap between the rich and the poor has widened.

- The quality of education and training is poor and there remains gaps in teaching, learning and examination methods. Science and technology have not become a motivation for socio-economic development. The infrastructure of healthcare, education, science, culture, informaa majority of people, particularly those in mountainous, remote and natural disaster-prontion and sports is limited, and the renewal of their management mechanism and socialisation process is slow.

- The lives of e areas remain difficult. Unemployment rate remains high, and social vices are not prevented, particularly drug abuse, prostitution and HIV/AIDS transmission have spread. Traffic accidents have been on the rise and the living environment is seriously polluted.

The weaknesses and gaps mentioned earlier can be partly attributed to objective reasons, but mainly to subjective mistakes and shortcomings in leading, guiding and regulating activities, first of all the lack of harmony and consistency between economic and social policies in the State’s unified governance system. The inconsistency is not only seen in the actual policy implementation process, but immediately in the policy making process. It is not only seen in the process of identifying priorities in each period and each circumstance for each policy, but also in correctly analysing and evaluating the dialectic relations of impacts by the implementation of economic and social policies. In other cases, policy makers already reach economic and social objectives in their policies and pay attention to combining economic and social policies for sustainable development. However, implementing methods, the availability and completion of institution and laws and the capacity of the implementing staff do not meet requirements. This also deepen the inconsistency and ineffectiveness and increase the costs to redress social disabilities.

Effective and sustainable development have become a target and guidelines for the making, redressing and organising the implementation of economic and social policies in Vietnam’s industrialisation and modernisation process. We should focus on the following solutions to adjust economic and social policies:

First, we should firmly comprehend major viewpoints on supplement and amendment of economic and social policies. These include viewpoints on development, history, combination of theory and practice, consistent system and humanitarianism.

Second, we should amend existing policies, which are not suitable to the continuous socio-economic development, particularly social policies, which are lagged behind by the rapid developments of the market economy and explode potential risks of the market economy.

Third, we should develop new political and social policies to be suited to the conditions of a socialist-oriented market economy, particularly policies relating to employees in non-State economic sectors.

Fourth, we should strengthen State governance in realising economic and social policies. Economic and social policies should tend towards accelerating economic, cultural and social development in order to improve social welfare, secure sustainable development and realise social fairness and democracy. The authority of State agencies and their methods of governing the policy implementation process should be clearly defined. Monitoring and supervision activities should be strengthened and timely penalties should be given to policy breakers.

Fifth, measures should be taken to correct wrong understanding about solutions by economic and social policies. For example, it is maintained that social issues will automatically be resolved after effectively implementing economic development policies, or businesses and economic organisations should focus on economic activities and leave social issues to the State. The wish to resolve all social issues at once while neglecting the capacity of the national economy and the State’s social governance is also a mistake.

 Source: Tapchicongsan, No.102/2006