Photo: Quynh Nguyen
Focus on sustainable growth and reform of investment environment, CEO says during visit.
Vietnam’s GDP growth is forecast at 6.5-6.7 per cent in 2017 and the World Bank will boost its support to the country in the years to come, focusing on sustainable growth and reform of the investment environment, World Bank CEO Ms. Kristalina Georgieva said during her visit to Vietnam from March 22 to 24.
Given that most countries are growing at a slow 2.3 per cent, Vietnam’s rate is very impressive, she emphasized.
In order to maintain growth, according to Ms. Georgieva, Vietnam needs to ensure macro-economic stability and bolster reform and labor productivity. The government will also have to reform State-owned enterprises (SOEs), the banking and finance sector, and taxation policies, with greater focus on private sector investment, education, and climate change adaptation.
The World Bank will also consider providing loans to Electricity of Vietnam (EVN) without a government guarantee, focusing on renewable energy and ensuring it can borrow at lowest interest rates.
Reform of SOEs is also a focus for Vietnam. According to Ms. Georgieva, the creation of effective SOEs and the expansion of private participation in unnecessary fields would help the government achieve a better State budget and have more investment for human resources.
Though impressed by Vietnam’s economic growth of over 6 per cent, she said that traditional growth drivers, such as cheap labor or exports, would not last. Therefore, the country needs to lay the groundwork for finding new drivers, through labor reform.
“Vietnam needs to focus on implementing reform and developing human resources by enhancing quality in tertiary education,” she said. “This is also a driving force for the development of Vietnam’s economy in the future.”
Ms. Georgieva became World Bank CEO on January 2. During her official visit to Vietnam she met with Prime Minister Nguyen Xuan Phuc, State President Tran Dai Quang, and other senior officials.
She will also meet with development partners and other stakeholders and visit a number of World Bank-funded projects on climate change adaptation and mitigation.