Vietnam’s international economic cooperation has made remarkable strides with thousands of enterprises from 77 countries and territories. Vietnam has trade relations with more than 200 countries and economies, and its exports have grown at 20 per cent per annum for many years now.

Economists, investors, academics and decision-markers attending the inaugural Vietnam Economic Forum have examined the risks and opportunities the country will face as it strives to make its economic dream come true.
The forum, with the theme of Regionalism and Modernisation in Vietnam, was organised by the Ministry of Planning and Investment in cooperation with the Vietnam News Agency and the Asia News Network.

Vietnam was a confident country, ready to take the place it deserves in the international community, the forum heard.

While elaborating the socio-economic development plan for 2006-2010, Planning and Investment Deputy Minister Nguyen Bich Dat listed the priority areas for development and emphasised the need for new investment.
Topping the list was the need for new materials, high-tech products and the application of modern science and technology. Dat said the growth of agriculture, fish farming and processing, and the production of consumer goods for domestic and export markets would contribute to the development of rural areas.

He said the low level of infrastructure development meant there was an urgent need to build transport infrastructure, seaports and power and water supplies for industrial and urban centres. Education and training projects were expected to help overcome human resource problems. He also said the government was inviting more investment projects in industrial, export-processing, high-tech and economic zones that were located in disadvantaged areas to help boost the economy.

Administrative reforms to go forward

“Since 2001, the Vietnamese Government has followed the public administrative reform master plan for the period 2001-2010 to create a transparent, firm, professional, modern and efficient public administrative system with qualified personnel to meet the nation’s development demands,” former Deputy Prime Minister Vu Khoan told the forum.

He pointed out the four areas of reform: institutional and legal reform, administrative reform, recruitment and training of qualified personnel and public finance reform.

“Hopefully, you will frankly point out any institutional and operational shortcomings of the administrative system and give practical recommendations for administrative and legal reform, for the sake of Vietnam and the foreign business community alike,” he told the audience.

People stand at centre stage

The training of a well-educated, competent workforce is a prerequisite for Vietnam’s rapid integration into the world economy.

However, the country faces a great deal of challenges that need to be solved to get a higher quality of education and training, and a better ratio of skilled to unskilled workers in line with international standards.
Education and Training Minister Nguyen Thien Nhan pointed to a 10-year programme, running from 2008 to 2018, to make the English language a strength of the Vietnamese people, in cooperation with New Zealand, Australia, the UK and Canada.

To meet the demands of industry and large corporations, the government is promoting tripartite collaboration between training institutions, industry and government agencies. “The state will provide preferential loans for training institutions to upgrade their facilities and provide loans to learners,” Nhan said.

His ministry recently signed an agreement with Intel to meet the company’s human resources demands. “The government will sign other similar agreements with the Vietnam Software Association, Vietnam National Shipping Lines and some commercial banks. The priority areas for funding include electronics, IT, mechanics, pharmaceuticals and finance and banking,” Nhan said.

He told the forum that the government will encourage the establishment and effective operation of private schools, training institutions, colleges and universities.

Following the success of RMIT University, the first foreign-invested university in Vietnam, the ministry would encourage further foreign investment in the education and training sector, he said.

A buzz with energy

The forum heated up when a senior official from the Ministry of Industry told investors how foreign investment could contribute to the development of the Vietnamese energy sector.

“To meet the nation’s rising demand for energy over the next 10 years, investment in electricity, oil and coal exploitation will need to be $8-10 billion annually, of which $4-5 billion would be for the electricity sector,” he said.

He pointed out a list of potential areas for foreign investment, such as hydro and thermal power plants, the development of new and renewable energy such as wind, solar, geothermal and biomass energy sources, the development of alternative energy sources, and investment in biofuel technology.

Vietnam’s demand for energy has grown by over 10 per cent each year, and the annual 15 to 20 per cent increase in demand for electricity has lead to shortages and blackouts.

However, loans from international financial institutions and investment from the Vietnamese Government would account for merely 30 per cent of the funds needed, resulting in increasing levels of foreign direct investment.

The Electricity of Vietnam (EVN) power plants currently provide 80 per cent of the country’s electricity supply, and the prime minister has asked domestic investors such as the Coal and Mineral Group, the Oil and Gas Group, Song Da Corporation and Lilama Corporation to invest in the construction of hydropower and thermal power plants.

Alongside independent power plants such as Phu My 3, Phu My 2.2 and Hiep Phuoc, more independent electricity projects such as Mong Duong, O Mon, Nghi Son, Nhon Trach are planned.

In 2009, the electricity generation market will be opened up, allowing foreign investors to invest in independent power projects. The Electric Regulation Department is currently drafting the legal framework and legal guidelines for an open electricity market.

Source: VIR