VietNamNet Bridge – Economic restructuring, market stabilising, administration reform and ensuring social welfare would be top priorities of the Vietnamese Government for the coming years.

Prime Minister Nguyen Tan Dung told development partners at the annual Consultative Group Meeting of Donors in Ha Noi yesterday, Dec 6, that Viet Nam would not try to achieve a high growth rate next year but would keep it at 6 per cent, the same as it was this year, to stabilise the macro economy.

"Along with that, Viet Nam will focus on economic restructuring, especially in public investment, State-owned enterprises and banking and trade sectors as well as financial policies," he said.

The meeting was entitled "Accelerating economic restructuring and poverty reduction".

Noting some positive changes in Viet Nam's macro economy, Dung confirmed that inflation had been controlled while prices had decreased continuously in the last six months.

"Statistics show that we can keep the inflation rate at 9 per cent in 2012," he said. "Viet Nam will continue this trend to maintain the value of the currency to stabilise the market."

The PM highlighted the country's efforts in narrowing the trade deficit.

"Overspending of the State budget was at 4.9 per cent, which was less than the predicted 5.3 per cent," he said. "We will also reduce the rate in 2012."

Regarding social affairs, the PM said that the country had gained positive achievements in the field by reducing the number of poor families and creating 1.6 million jobs.

"We will always implement economic growth targets in harmony with ensuring social welfare and environment protection," he said.

He also pledged to continue administration reforms more effectively and strongly, in which completing market economy mechanisms and in-depth integration would be in sharp focus so that Viet Nam's economy would be operated more transparently and the fight against corruption could be intensified.

"Viet Nam appreciates the help of the international community and pledges to implement effectively its support, demonstrated in the coming time by quicker and more efficient disbursement of ODA projects," said Dung.

Speaking at the meeting, World Bank country director Victoria Kwakwa mentioned the euro zone crisis and a weak US economy as reasons for a less promising prospects for global growth next year, by which Viet Nam would also be faced with a less favourable external environment.

"Trade in Viet Nam represents over 150 per cent of GDP, exports to the US and the euro zone have averaged about 37 per cent of total exports over the last five years," said Kwakwa.,"This more difficult external environment can be expected to have both direct and indirect adverse effects.

"Viet Nam needs to position itself to be among those countries that survive or, even better, those economies that thrive and are able to take full advantage of any opportunities from the current context."

She noted the Vietnamese Government's implementation of the comprehensive stabilisation programme - Resolution 11- since February and the Party's determination to restructure public investment, State-owned enterprises and the financial sector as key steps on the Government's agenda to stabilise the economy.

"What is needed next is a strong political will that will bring a strong sense of urgency to concretising the details of this restructuring and driving implementation in a credible way," she said.

"It would be much easier for Viet Nam to pursue its restructuring agenda now than have to restructure after its hit by a crisis."

Also at the Consultative Group meeting, development partners of Viet Nam raised their voices over the related issues.

International Monetary Fund resident representative Sanjay Kalra said the reform of SOEs was crucial to reduce risks to the economy and for the longer-term growth.

"We welcome the steps already undertaken to reduce inefficient investments, and plans for SOEs to divert from non-core activities," he said.

The IMF representative added that management, oversight and transparency needed to be strengthened to improve performance in a sustainable way.

"Such reforms, if done right, would improve resource allocation and meet the economy's investment needs more efficiently, while also reducing risks to the financial sector as well as public finances," he said.

Sharing the same concern over the issues, ADB country director Tomoyuki Kimura said that many SOEs in Viet Nam were corporatised but few operated with management independence, financial and operational efficiency, hard budget constraints or accountability for results.

"International experience has shown that the key to successful reform is to infuse SOEs with private sector discipline and competitive market pressures," he said.

Many opinions on Viet Nam's policies on poverty reduction were given. While praising Viet Nam's efforts in hunger elimination and poverty reduction, many of delegates expressed concerns over the most vulnerable groups in the society in the current economic situation.

United Nations resident co-ordinator Pratibha Mehta urged for an equality that all Vietnamese people across the country should have the opportunity to realise a better quality of life.

"It is in hard times that vulnerable groups are most in need of social protection and assistance," she said. "The UN recommends the Government adjust social security benefits so they are in proportion to rising prices and the minimum wage."

During discussion with other partners and donors, she reiterated the need for protection systems for these groups.

"Social protection systems will need to be reviewed and adapted to cover these emerging forms of poverty and to strengthen their role in preventing people from falling back into poverty," she said.

The meeting also heard experiences in public investment, economic restructuring, especially in banking and financial sector and SOEs, and poverty reduction through presentations by guest speakers from other countries including Malaysia, Japan and South Korea.

Closing the meeting, Minister of Planning and Investment Bui Quang Vinh said he highly appreciated the experiences and exchanges of partners and donors.

"They are sincere and profound lessons to us," he said. "Viet Nam pledges to take those lessons seriously to have better policies."

He again confirmed Viet Nam would pursue the policy of stabilising the macro economy, ensuring social welfare together with protecting the environmental sustainability, adding that the country was implementing green growth alongside with other economic targets.

VietNamNet/Viet Nam News