Despite evidence, Hanoi says not delaying reforms
HANOI - Vietnam insisted on Tuesday it
was not delaying economic reform despite mounting evidence
that foreign businessmen no longer rate the country a good
investment bet.
Deputy Prime Minister Nguyen Manh Cam, opening a two-day
annual meeting with foreign donors, delivered a familiar message
-- that the government would implement measures appropriate
for the country's current state of development.
But investors complain that the communist authorities have yet to
clarify what ``appropriate'' reforms mean in Vietnam, leaving a
big question mark over the direction in which they want to take
this country of 79 million people.
Analysts say that because of indecisive leadership and vested
interests among powerful state-owned enterprises, it will take a
serious crisis to kickstart major reform of Vietnam's protected
economy and expensive business climate.
``There is no such thing as a halt, or reluctance or delay in
carrying out reforms,'' said Cam, one of Vietnam's several
deputy prime ministers, and also the country's foreign minister.
He said long-term reform moves would be included in the
country's next five-year plan, set to run from 2001 to 2005,
which will be unveiled at the Ninth Communist Party Congress in
early 2001.
However, foreign investors have grown impatient.
On Monday, during separate talks with government officials,
investors painted a gloomy picture of doing business amid
suspicion of private enterprise, high costs, red tape, vague laws
and discrimination against foreign firms.
FOREIGN INFLOWS SEEN AT LOWEST SINCE 1992
Donors have forecast actual foreign investment inflows this year
at $600 million, the lowest level since 1992.
Andrew Steer, director of the World Bank in Vietnam, said
questions remained over how Vietnam could sustain a big drop
in poverty this decade without accelerated reforms.
He told the meeting that Hanoi was struggling over the future
role of the state and the private sector in the economy and the
pace Vietnam should integrate with the global market.
``We find ourselves in Vietnam with an extraordinary paradox,''
Steer told Reuters ahead of the meeting.
``On the one hand, the last decade probably showed the most
economic progress ever in Vietnam. Yet we are now looking at
the fundamental issue of the sustainability of this growth.''
The World Bank has said that unless Hanoi steps up reform,
economic growth could be 3.5 percent next year and three
percent thereafter. Growth was around eight or nine percent for
much of the 1990s after Vietnam began to adopt
market-oriented economic reforms a decade ago.
Donors said the two days of talks would focus on measures
needed to keep cutting poverty in Vietnam, where annual per
capita incomes are still just above $300, the macroeconomic
picture and next year's aid pledges.
Donors pledged $2.2 billion to $2.7 billion in aid last year,
bringing total commitments this decade to more than $13 billion.
Some have indicated pledges at the meeting might be more
closely linked to actual implementation of economic reforms.
Vietnamese officials are expected to lay out plans for
implementing reforms, especially a three-year package devised
by various ministries but not yet approved by top leaders.
Participants said there would also be discussion on how donors
could help Vietnam minimise the impact of natural disasters.
Two recent floods in central Vietnam have killed some 730
people.
Reuters - December 14, 1999.
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