Vietnam should not aim to become industrial power: economist
Vietnam should not continue to try to become an industrial power and instead should shift to developing agriculture and tourism, according to economist Le Xuan Nghia, head of the Business Development Institute (BDI).
Mr Le Xuan Nghia
Nghia, who was deputy chair of the National Finance Supervision Council, said:
“I have little hope that Vietnam would become an industrial power. That seems far-fetched. But it is very likely that Vietnam would become a great power in farm produce, and tourism thanks to its great advantages in the fields."
The fourth industrial revolution is expected to create big changes in the global economy. It is expected that robots will replace people in many works, which will reduce the labor cost to less than one-third of the current cost.
This would make it difficult to bring labor from the agriculture sector to the industrial sector in the future.
Nghia hopes that Vietnam may become a power in agricultural production and tourism with clear advantages in tropical farm produce and natural wonders.
In fact, developing hi-tech agriculture has been mentioned repeatedly by the government and experts in many recent conferences. The government has announced that a huge credit package worth VND100 trillion, the largest ever fund in the field, will be disbursed to help develop agriculture.
Commenting about the policies to develop agriculture, Hoang Trong Thuy, an agriculture expert, said the biggest problem in agriculture development is the management bodies’ thinking.
The policy ‘nguoi cay co ruong’ (all ploughmen must be given land) has always been the ruling motto in Vietnam in the last many years since Vietnam began land reform tens of years ago.
Not only impeding the transfer of agriculture land, the old thinking has made it impossible to capitalize land. No matter how large it is, land cannot serve as mortgage for bank loans.
As a result, businesses lack capital to expand their production. Meanwhile, banks cannot set higher prices for land prices because the state only considers land as a means of production.
“It is necessary to consider land as an input factor of production,” Thuy said, adding that since land is still not an input factor of production, it is being wasted.
Thuy said the land bank could be a good solution to help avoid the ineffective use of land. However, the tardiness in setting up the land bank is partially blamed on farmers, who try to keep agricultural land even though they have left and given up farming.
Mai Chi, VNN