Economic reform in Vietnam
Strengthening the evidence base
Vietnam’s economy – the good news
Success ofdoimoireformsTransition from central planning to a market economyMore than 20 years of strong economic growthAveraging around 6% across the 1990s and 2000sLarge scale poverty reductionExtreme poverty reduced from 60% in 1990s to less than 5% in 2013
And the bad news…
Growth driven largely by factor inputs including foreign capitalContinued dominance of domestic SOEsLow and decreasing productivity in the private sectorDifficulty for domestic private sector to link in to global supply chains
Making growth sustainable
Need to level the playing field for the private sectorResources to be allocated by the market not by connectionsReforming the business enabling environmentStrengthening contract enforcementImproved policy coherencyReduced barriers to starting a business and facilitating ‘creative destruction’
How will this be achieved?
Strengthening the evidence base for the benefits of economic reform.Building support for proposed reform across a range of stakeholders.
Restructuring for a more Competitive Vietnam
Australian funded project -$4mover threeyearsReforming market institutions:competition policy reformstate owned enterprise reformstrengthening the value chain for key commodities (e.g. rice)Flexible and works within government systemsDrawing on Australian experience
Support for the enterprise and investment lawsPreparation of quarterly macroeconomic reports for CabinetCompetition policy reviewReview of gender impacts of restructuringTop ten regulations
Opaque political systemLimited capacity for private sector to engage and influence policyDisconnect between legislation and implementation