Investors express guarded optimism over Vietnam market reforms
HANOI - Investors expressed guarded optimism Thursday about the progress of communist Vietnam's market reforms
but warned more needed to be done to promote private investment if the government was to succeed in its
ambitious growth plans.
Foreign business leaders complained that reforms were often fine on paper but failed to bite through
inconsistent and often arbitrary application by local officials.
"Making a beautiful plan is important but much more important is its implementation," Japan Business
Association representative Takeo Muranaka told officials at a mid-year review meeting.
"We wish that the Vietnam government's plans will be concluded more timelily and more clearly," he said.
Australian Business Group president Tim Gauci welcomed renewed expectations of high growth after a
prolonged period of "deflation" following the regional financial crisis of 1997-8.
"Recently we have some seen stability that gives us grounds for optimism for the future," he said.
But he warned that "solid foundations" had to be built now to take advantage of the opportunities, not just in
terms of a sound regulatory framework but also in terms of its consistent adoption.
"Implementation, application and interpretation are at least as important," he said.
Planning and Investment Minister Tran Xuan Gia vowed that the government would publish a 10-year roadmap
for administrative reforms in the coming weeks which would greatly accelerate the pace of change.
American Chamber of Commerce representative Tim Reinold welcomed a series of government measures over
the past year which had reduced the operating costs for business and brightened the economic outlook.
He cited the signing of a landmark trade agreement with the United States last July, the deregulation of interest
rates on hard currency loans, reductions in higher rate income tax, and the sealing of 1.2 billion-dollar gas deal
with a consortium led by oil giant BP Amoco.
But he warned that there was no room for complacency given the challenges Vietnam faced in meeting its
ambitious target of doubling gross domestic product over the next decade.
If Vietnam failed to promote greater private sector investment, it would fail in its goals of narrowing the
economic gap with its southeast Asian neighbours and providing work for the one million baby-boomers who
will join the job market every year over the next decade.
"Let us not slow down the country's development by locking out foreign business," he said.
Reinold took issue with the authorities over their decision to rename Thursday's meeting the Business Forum
instead of the Private Sector Forum as in previous years.
The planning and investment minister had argued that the change was justified because of the large number of
hybrid entities created by joint ventures between foreign firms and state-owned enterprises and the partial
privatization of some state firms.
"With due respect to Mr Gia, the name was private sector forum and that's what it is," Reinold said.
Agence France Presse - June 14, 2001.
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