In a landmark joint report published at the end of February, experts from the World Bank Group and leading experts within the Vietnam Government outlines the path for Vietnam to reach an upper middle income status by 2035.
The report lays out the key reforms that will need to be implemented to enable Vietnam to grow its economy and reach upper middle income status. To reach this ambitious status Vietnam will require Vietnam to put in place reforms to grow the economy and modernize governance within the country.
Vietnam will need to grow the economy by at least 7% annually and raising the average per capita income to over US$ 7,000 or 18,000 in purchasing power parity.
The report focuses on three main areas, those being improved productivity and private sector competitiveness; promoting equity and social inclusion, and improving public sector competitiveness, which will need to be addressed to achieve the goals. The first and last of these have received quite a bit of attention in recent months and it is maybe surprising that Vietnam’s productivity is the lowest in the Asia Pacific Region and has been growing at a lower pace than its regional competitors. Victoria Kwakwa, the World Bank Country Director for Vietnam suggested that Vietnam needs to do is to develop a broad framework to level the playing field between economic sectors and to promote genuine competition. She also stated that Vietnam’s reform agenda for market institutions will need to be significantly stepped up to achieve this.
The recommendations in the report seem to have been broadly accepted by representatives of the Government.