One of the propulsive forces for the development of Vietnam in their view, was accession to the World Trade Organisation (WTO) and strong reforms being initiated by the Vietnamese government.

Answering the question “Where will Vietnam be in five years?” the World Bank Country Director in Vietnam, Klaus Rohland said that the Vietnamese government has set its sights on turning Vietnam into a country with per capita income at a global medium level by 2010. If the country attains this target, it will complete its transformation to a market economy.

The WB official forecast the private economic sector would attract many qualified and resourceful businessmen. It means that the economic growth rate of Vietnam will not have to yield.

The Danish Ambassador to Vietnam, Peter Lyshott, commented that in the next five years, the living standard of Vietnamese people would be improved remarkably. As a member of WTO, Vietnam will attract foreign and domestic investment to gain a higher annual growth rate, create jobs and reduce both hunger and poverty rates.

However, the ambassador noted that the quality of investment and the impact on the environment by fast economic growth require the government to set urgent solutions to limit risk.

Sharing this viewpoint with Klaus Rohland, the United Nations coordinator in Vietnam, Jesper Morch, said that the growth target of Vietnam in the next five years was ‘ambitious’. But many new opportunities would come to Vietnam, especially after it joins the WTO.

He said that globalization would bring challenges, and experiences learnt from other countries shows that to integrate into the world economy in a sustainable manner, Vietnam must strengthen its social security system to diminish risks when the market fluctuates, and to cope with the insecurity of certain fields.

In its five-year development plan (2006-2010), Vietnam aims to increase its GDP 2.1 times, earning annual average growth rate of 7.5-8% or over 8%; per capita GDP of $1,050-1,100 by 2010; total export revenue to grow by 16%/year, reaching $770-780 per capita by 2010; total social investment of around VND2.2tril (nearly $140bil), accounting for 40% of GDP, in which local sources account for 65%, and 35% from foreign sources.

Vietnam must pursue reforms

The WB Country Director said Vietnam can’t reach per capita income of the world medium by achieving high economic growth rate in a short period of time. “Vietnam needs to have proper policies to ensure quick and sustainable development for the long term,” he emphasized.

The fields in which Vietnam needs to continue reforms include public financial management, including tariff reforms and strengthening of national asset management, modernizing judicial and legal mechanisms to effectively support transactions and business operations, improving the quality of financial services and infrastructure.

Daisuke Matsunaga, Japanese Counsellor in Vietnam, said the community of donors for Vietnam, including Japan, is discussing with the Vietnamese government several reforms under the poverty reduction support credit (PRSC) programme.

“Japan is interested in financial reforms, state-owned enterprises and regional development of Vietnam,” Matsunaga said. To further attract foreign direct investment, Vietnam should amend related laws and perfect its administrative mechanism, he added.

Director of the Office of the UK Department for International Development (DFID), Bella Bird, affirmed that improving the government’s management capability is a necessary task in the next five years. The government must have necessary skills to manage a modern economy, intensify the explanation ability and transparency to lure foreign investment.

Ms Bella Bird said that improvement of the capability of local government is a great but necessary challenge to eliminate corruption, build trust among donors, investors and Vietnamese people. She proposed the Vietnamese government pay attention to urbanization as an indispensable tool in developing urban centres.