Vietnam Should Redistribute Resources to Boost Efficiency: Economist

The most important thing for Vietnam to do now is to redistribute its various resources, restructure its economic sectors so as to raise its effectiveness and competitive edges, Nguyen Dinh Cung, vice director of the Central Institute for Economic Management (CIEM) has advised.

 

Cung told reporters of the VietnamNet online newspaper that two options the government can redistribute are lowering excessive investments accounting for more than 41% of GDP which can widen the country’s trade deficit and trigger high inflation.

 

The second option Cung noted is improving state investment quality by focusing on solving the economy’s bottle necks, especially underdeveloped infrastructure. The government should shift money to building big modern seaports to facilitate trade and roads to connect industrial zones, Cung recommended.

 

In order to realize the policies, he said the central government needs to regain power from local authorities to effectively devise and execute macro development projects on national and inter-provincial scales to avoid currently fragmented investments.

 

Meanwhile other economists also cautioned that last year the ICOR of Vietnam’s economy remained at more than 8, higher than regional countries, particularly Thailand, state media reported.

 

They highlighted many shortcomings of Vietnam’s economic growth, namely high inflation, poor labor productivity, exhausted natural resources, heavy pollution and rising national debts.

 

A program by U.S.-based Pennsylvania has put CIEM in the top 40 of more than 1,000 Asian think tank agencies in its 2009 survey. (Vietnamnet)