VietNamNet introduces the second period of the roundtable talks "What is the price of swapping the environment for growth?" with the attendance of Dr. Le Dang Doanh, former director of the Central Institute for Economic Management, a member of the Development Policy Committee of the UN and MSc Le Quang Binh (Princeton University), former Director of the Institute for Social-Economic and Environmental Research, now chairman of the working group "For the involvement of the people".

There is a very good idea that the two guests have proposed: it is time for Vietnam to assess the achievement of provinces through the environmental indicator. China has begun to do so. But in Vietnam, the GDP is still being considered as the sole criterion for evaluating local achievements. This has led to what we are witnessing today - it is a race to attract FDI at all costs between provinces. Any province that attracts big projects, that province becomes a bright star. Do you believe that if we remove the GDP indicator from the criteria to evaluate the performance of provinces, we can change the nature of the problem – trading environment for growth?

The two guests - Mr. Le Quang Binh (left) and Dr. Le Dang Doanh.

Dr. Le Dang Doanh: I think first of all we have to replace GDP with GNI. The gross national income (GNI) is the total domestic and foreign output claimed by residents of a country, consisting of gross domestic product (GDP) plus factoring incomes earned by foreign residents, minus income earned in the domestic economy by nonresidents. The gap between GDP and GNI of Vietnam is about $200. Every person loses $200 because foreign investors have transferred profit to their countries.

The second is to have a set of indicators and these indicators must be considered synchronously and rigorously. 

The third is how much is the economic risk? If you depend excessively on one product, your risk is big. If you depend excessively on one export product or an export market, your risk is huge because you depend totally on that market. If that market goes down, you may fall. That has happened for a lot of economies exporting to China. 

Therefore, we must create a diverse economy to balance risks. Regarding the environment, there must be strict consideration and balance between the sources of income. More importantly, there must be supervision and accountability and the responsibility of the officials who make decisions. These officials must take responsibility for their decisions even after they retire.

We need to have sensitivity and flexibility in choosing technology. The capacity to change and adjust in a fast changing world is a measure of the success of an economy, of a nation, of a people. A people who are willing to change and change quickly, that nation will succeed and vice versa.

Back to the story about environmental pollution in the central region; at present, along the coast of Vietnam we have 8 coastal economic zones approved by the Prime Minister, which are home to many polluting factories, including oil refineries and thermal power plants.

I would like to ask Mr. Binh, what do you think about the upcoming move of the government, particularly the Ministry of Natural Resources and Environment, the Ministry of Planning and Investment and the Ministry of Industry and Trade, while we wait for the conclusion about the mass fish deaths in the central region, because we have so many other projects that can also cause similar risks.

Le Quang Binh: I think probably the first thing we must do is to inspect coastal economic zones in the central region. Obviously, there is great risk to the environment as all industries generate waste.

This is the time for us to review the environmental impact assessment, the process of waste treatment at industrial parks. Perhaps one of the 8 coastal economic zones will create very toxic sources of pollution that harm the marine environment, the seafood industry, and the tourism industry.

I think that the inspection process should also be public so that everyone can see that indeed we have the processes and that people who live near the sea can be assured that the operations of these economic zones are guaranteed to not cause pollution.

We need to review our economic development model. If we continue to invest in the polluting industries, which rely too much on natural resources such as mining, then one day we will suffer from economic, social, and environmental collapse.

We have so many processing industry projects that can cause serious environmental pollution. These projects have been licenced and some are about to operate. How would we deal with these projects after the recent mass fish deaths in the central region to avoid similar environmental disasters in the future? 

Le Quang Binh: Sometimes we just take into account the benefits such as GDP that these projects bring about while we neglect the harmful effects on the environment and health. If we count all the social costs that we must pay to each family, each citizen, perhaps these factories cause more harm than good.

And in case the cost of health and society is too big, we have to consider not only economic aspects but even ethical issues. If any project does harm health, then clearly the ethical issues must be considered. 

In that case, we will have to work together to find the solution, and we can even renegotiate the contract. We can accept short-term costs but in the long term, pollution is unacceptable.

I think this is the wish of the government, people and businesses. Thus, it comes back to the role of supervision of social organizations to help businesses know that their businesses are operating well or not and help the state know the projects it licences are good or not.

Regarding the role of social supervision, several years ago, the community raised a strong voice about many projects with a high risk of causing pollution before these projects were licenced, such as the steel project of Posco in Van Phong Bay of Khanh Hoa province and the bauxite projects in the Central Highlands, but in fact many projects were still licenced despite strong social criticism. Why?

Le Quang Binh: I think the most important thing here is the process of making decisions. Whether this process is transparent or not? The fishermen are unable to take to the street every day because they have to earn their living. Therefore, we need associations representing the people in terms of political and economic rights. Thereby, how to make the decision-making process transparent and public is very important.

We need to help the people actually have a voice, creating a legal framework for them so that they can reorganize, then they can protect their interests in the best way and at that time the balance of state power and the power of the enterprise is maintained and decisions will be made in balance.

Dr. Le Dang Doanh: I would like to mention an example that I posted on my Facebook three days ago: it’s the Minister of Justice of the state of Prune Buoc of Germany. In 2010, his motorcycle broke. He used a public car to take the broken vehicle to a vehicle repair station. Six years later, this incident was revealed by a newspaper, under which this official was accused of using Eur436 of state budget to fix his vehicle. This official had to resign immediately.

This example suggests the important supervisory role of the media.

At an environmental conference last year, the Prime Minister said that according to international environmental experts, in the next 10 years, Vietnam's GDP can be doubled. But if the environmental situation is not changed, then perhaps the country’s environmental pollution will increase by 3 and 5 times. And it is estimated that for 1% GDP growth, the pollution damage is 3% of GDP. Obviously, this is a very important warning.

Thank you Dr. Le Dang Doanh and MSc. Le Quang Binh for taking time with us!

VietNamNet