Looking back on the 2011-2015 season, the economy of Vietnam grew in a relatively peculiar context.

The world economy experienced many unpredictable fluctuations. The World Bank (WB), the International Monetary Fund (IMF) and leading economic and financial corporations had to adjust the global economic outlook every few months in the direction of a reduction in the growth rate.

A number of proceedings imposed direct impacts on Vietnam, including deep plunges in oil prices.

Turning risks into new opportunities

The 2011-2015 period started as the risk of macroeconomic instability became a challenge, with shortcomings in the domestic growth model and adverse impacts from the international situation, alongside defence and security events such as China’s deployment of the Haiyang Shiyou-981 oil rig in Vietnam’s exclusive economic zone and continental shelf.

Recognising difficulties and challenges, the entire country joined hands to address weaknesses and realise strategic breakthroughs, together with restructuring the economy and renovating the growth models, thereby achieving many encouraging positive transformations.

The economy has gradually recovered over the past three years following a period of decline in the growth rate. 2015 has marked a new development step: the economy has regained growth momentum and is flourishing clearly with the rapid industrial development resumed.

The average five-year growth rate is greater than the general level of the region. The export capacity has increased by 9-10% in recent years while the world trade has risen just 3-5%.

The economic growth rate has been associated with poverty reduction and social equality.

According to the new poverty line, which is on par with the international standard, Vietnam’s poverty rate dropped from 20.7% in 2010 to 13.5% in 2014; in other words, over 6 million people escaped poverty during the five-year period.

The mortality rate among newborn infants in particular and among children as a whole decreased constantly, while the stunting rate was reduced from 29.3% to 24.9%.

The rate of health insurance participation also jumped to 71% of the population in 2015 from 60% in 2010. About 95% of kids under five years old received preschool education.

Regarding economic institutions, the 2013 Constitution and a number of important draft and revised laws were passed, including the Enterprise Law, the Investment Law, the Bankruptcy Law, the Auction Law, the Law on Bidding, the State Budget Law, the Land Law, the Law on Housing, and the Law on the Management and Use of State Capital in Production and Business.

The approval of these laws has contributed to strengthening the legal framework, facilitating the socialist-oriented market economy to operate more smoothly and adapt to the international integration process.

The current challenge is to strictly implement the issued laws and put the 2013 Constitution’s progressive regulations into reality.

Negotiating and joining new-style free trade agreements (FTAs) promise new outlooks for Vietnam’s economic development, contributing to helping the country rapidly overcome the “low- or middle-income trap”.

Grasping new opportunities, Vietnam proactively negotiated and signed FTAs with 55 countries, including the five permanent members of the United Nations Security Council and 15 members of the group of twenty (G20).

The completed FTAs with ASEAN, the European Union, the Eurasian Economic Union and the Republic of Korea have brought Vietnam new opportunities for development.

Simultaneously, new challenges in regards to the growth quality will function as a positive pressure to accelerate Vietnam’s economic conversion and turn risks in to new opportunities.

For example, despite being the member with the lowest gross domestic product (GDP) per capita among the 12 participants to the Trans-Pacific Partnership (TPP), Vietnam still possesses several distinctive advantages compared to others, especially in the processing and manufacturing industry requiring a large number of workers.

The simulation results have shown that the TPP will contribute 8% to Vietnam’s GDP within the next 20 years, while adding 17% to the real export value and 12% to the country’s production capacity.

Despite numerous challenges to overcome, the general impacts of the TPP and other FTAs on Vietnam remain positive.

Towards greater and more sustainable growth

A new development stage has opened to Vietnam after world leaders agreed on 17 sustainable development goals and 169 targets for the 2016-2030 period at the recent 2015 UN Sustainable Development Summit in New York, USA.

Once applied in Vietnam over the next five years, these goals can be assembled into the four main pillars as follows:

First, economic growth should be higher and more sustainable with the goal of achieving an average growth rate of 6.5-7% in the next five years based on macroeconomic stability.

Despite the opportunities brought about by new-style FTAs, it is not easy to realise that goal because the world economy is facing numerous difficulties and the opportunity absorption capacity of the Vietnamese economy still remains limited.

Second, economic growth must be associated with boosting cultural development, ensuring social progress and equality and gradually improving social welfare as well as people’s lives.

Third, increasing attention should be paid to protecting the environment and solidifying the country’s resistance capabilities against the new impacts of climate change as well as the negative effects caused by industrial development, urbanisation and humans’ uncontrolled actions.

Fourth, a peaceful and stable climate should be ensured alongside maintenance of political security and social order.

These are the fundamental conditions to ensure a healthful life for people in a legitimate state.

It is also worth noting that the results of improving the business environment in line with the government’s Resolution No. 19/NQ-CP have been recognised by the business community, thereby contributing to enhancing the national competitive capacity and the competitiveness of each sector, product and service, which will impose a long-term impact on the economy of Vietnam in the years to come.

In order to achieve the goals set for 2016 and the following years, it is necessary to fully promote internal power; make use of opportunities for sustainable development; and overcome obstacles such as out-dated practices, the gap between words and actions, corruption and thrift, as well as risks due to the country’s delayed adaptation to integration commitments and unpredictable fluctuations of the international scene.