General Secretary To Lam and the Party Central Committee have decisively implemented a revolutionary streamlining of the political apparatus. VietNamNet publishes a series of discussions with experts, offering suggestions for this reform.

Below is Part 2 of an interview with Associate Professor and Doctor of Science Vo Dai Luoc, former Director of the Institute of World Economics and Politics.

The government is implementing steps to consolidate and merge several ministries and departments. What are your thoughts on this?

Vo Dai Luoc: I fully support the announced policy and proposed plan.

Currently, many ministries and departments have overlapping functions and duties, with numerous conflicting regulations that are sometimes even impossible to implement. With so many management layers, businesses and citizens inevitably face multiple bureaucratic tiers from central to local levels. Moreover, the costs of maintaining such a system come from taxpayers’ money - how can the people bear this indefinitely?

Therefore, when the government merges ministries and departments, it is the right direction. For example, merging the Ministry of Transport and the Ministry of Construction is entirely appropriate given their functions and duties. Similarly, merging the Ministry of Planning and Investment with the Ministry of Finance is very logical, as revenue and expenditure need to be closely linked.

Furthermore, as Vietnam has adopted a market economy, there should no longer be agencies associated with the term “planning,” which belongs to the era of centralized planning. I hope the newly merged entity will change its name from “planning” to “development planning” or something like “Ministry of Planning and Development” or “Ministry of Reform and Development.”

Of course, every country needs planning for development, but they do not use the term “planning” in the legislative sense as we do. For them, growth is not a binding mandate like it is for us.

Countries like China, South Korea, Singapore, and many others have reform and development commissions or similar bodies to perform these functions.

Vietnam should abandon mandatory planning and replace it with development planning for the entire country, as well as for individual regions, based on the realities and periods of development.

We have adopted a market economy, yet we still use five-year plans and annual mandates with numerous targets, which are no longer appropriate.

What should be the main focus regarding personnel when consolidating and merging ministries and departments?

Vo Dai Luoc: The most critical and fundamental issue is that the Party must select Ministers with true talent and technocratic expertise. By streamlining the apparatus and reducing management layers, the chances of selecting technocrats will improve compared to before.

After the Doi Moi, we had significant successes in employing talented individuals. However, to this day, there is still no effective mechanism or policy to recruit and utilize exceptional talent.

Why do so few valedictorians join the public sector after graduation? Why do many outstanding graduates from overseas choose to remain abroad instead of returning to Vietnam? Because talented individuals do not "lobby" to enter the public sector. There must be adequate incentives and workspaces that make public servants proud of their jobs and contributions to society.

At the local level, public and transparent examinations should be held to select directors and deputy directors of departments, ensuring the most capable individuals are chosen. Relying solely on current planning processes still fosters a culture of lobbying for positions, which not only fails to attract talent but also perpetuates corruption and misconduct.

General Secretary To Lam said, "Institutions are the bottleneck of bottlenecks." What are your thoughts on this?

Vo Dai Luoc: Therefore, the current approach to lawmaking must change. The legislative capacity of the National Assembly needs to be strengthened significantly. As a latecomer, Vietnam should refer to the legal systems of developed nations. Many countries learn from each other's laws.

We must also select Ministers with a reformist spirit to build effective institutions that align with the market economy.

Do you have any concerns regarding the division of roles between the state and the market, particularly in ensuring the new ministries effectively fulfill their roles in "facilitation" and "management" of the economy and society?

Vo Dai Luoc: With the current multitude of ministries and departments, coupled with overly broad legal frameworks, a business or locality often has to consult seven or eight agencies to get approval for a project. This wastes time, money, and development opportunities.

With the consolidation and merger of ministries and departments, I expect that at least half of the procedures and processes will be reduced. This will clearly benefit localities, businesses, and citizens, while also saving the budget required to maintain the administrative apparatus.

However, the most important aspect is to reduce or eliminate the "approval-granting" mechanism. This mechanism, along with other factors, has long suppressed the private sector, preventing it from realizing its full potential. Despite decades of reform, this sector still only contributes about 10% of GDP. Although the private sector is recognized as a driving force of the economy, there has been little action to enable it to truly drive growth. This sector continues to face significant challenges.

What is your perspective on the decision to discontinue the State Capital Management Committee?

Vo Dai Luoc: I believe this is the right decision. Managing state-owned enterprises (SOEs) has been a long-standing issue, with frequent changes in approach. Previously, large corporations were managed directly by the Prime Minister, then transferred to ministries, and when that proved ineffective, a "super committee" was established.

Now, with the committee dissolved, I think management should return to specialized ministries as before.

Equally important is continuing SOE reform. For instance, the state should not control non-essential sectors or those that the private sector can manage effectively. Why, for example, must the state maintain a monopoly over rubber plantations when the private sector can manage them better?

Years ago, I asked a German expert how Germany reformed its SOEs after reunification. He said they selected the nation’s best managers to run the enterprises or simply sold them off. The results were immediate. Previously, these SOEs contributed one unit of revenue to the state budget; after reform, they contributed 100 units.

We must distinguish between the "state economy" as a foundation and "state-owned enterprises" as individual entities. Confusing these concepts hinders national reforms toward modernization.

Long-standing internal challenges and less favorable international conditions present an opportunity to reform the apparatus, modernize governance mechanisms, and eliminate the "approval-granting" system. If we aim for self-reliance and resilience, we must unleash the people’s potential for development.

Tu Giang - Lan Anh

Part 1: Vietnam’s political streamlining: Attracting talent to lead the way

Part 2: Vietnam must transition to three-tier governance, experts advise

Part 3: Reducing National Assembly deputies: A step toward efficiency and quality

Part 4: Vietnam’s National Assembly reform: Balancing expertise and efficiency

Part 5: Institutional reform: Paving the way for Vietnam’s growth and prosperity

Part 6: Streamlining VN’s political apparatus: A pivotal step for modern development