Wider recognition required
At the signing ceremony for jointly providing US$21.5 million for the
establishment of a Franco-Vietnamese hospital in HCM City, Peter
Woicke, executive vice president of the International Finance Corp.
(IFC) and World Bank (WB) managing director for private sector
development, said IFC aims to develop the private economy in Vietnam.
Apart from the Franco-Vietnamese hospital project, the IFC and WB
have also agreed to finance projects to set up the Vietnam Enterprise
Investment Ltd. and a banking training center (inaugurated on
November 30).
Peter Woicke says IFC is responsible for
boosting the private sector's long-term
investment in developing countries, including
Vietnam. Private businesses play an important
role in the economy. In public facilities, according
to Woicke, the Vietnamese Government has
provided only basic services. IFC's investment
aims to accelerate the development of public
facilities and create competition so the public can
choose from higher quality services.
Woicke considers the Franco-Vietnamese hospital project an
innovation as it has been invested by French doctors with the
assistance of the IFC, the Bank for Investment and Development of
Vietnam and the Asian Development Bank. French doctors will take
turns working in Vietnam and will be responsible for operations.
Woicke says IFC also participates in projects in education (the RMIT
University in HCM City), banking, investment funds and finance in
Vietnam. He adds that IFC had invested in Vietnam since the early
1990s but had to stop investment because it was difficult to develop
the private economy at that time, and focused on providing
consultation for investment projects. Since the role of private
businesses has not yet been properly recognized in Vietnam, Woicke
believes there should be talks between State management agencies
and private businesses for the development of a private economy.
The Vietnamese Government has recognized the importance of a
private economy little by little through issuing legal documents
encouraging its development. However, the establishment of a
private economy requires wider recognition from the Government.
For
instance, the simplification of taxation will help improve tax collection
for the State coffer.
From investment projects in Vietnam,
Woicke proclaims that more jobs are
created by private businesses. On the
road to development, Vietnam has
faced many challenges, including
employment issues. According to
Woicke, every year about 1.4 million
Vietnamese people seek jobs. Most
of them are industrious and creative. The Government should create
favorable conditions for the development of a private economy in
order to create needed jobs.
Asked about his opinion about Vietnamese private businesses,
Woicke says opportunities for them are big with a market of some 80
million people. Young entrepreneurs pay close attention to their
business and are confident of the economic outlook. Woicke adds,
however, that the private economy's influence has just been recorded
domestically, not internationally as expected. According to him, many
foreign investors think that the change from a centrally governed
economy to a market economy in Vietnam has been rather slow.
Local private business people do not think so, and they must impart
such beliefs to foreign investors.
On the occasion of his first visit to Vietnam, Woicke remarks that
conglomerates and companies abroad highly valued Vietnam's
investment environment in 1994 and 1995. But entrepreneurs from
these entities working in Vietnam did not have the same opinion.
Things have now entirely changed. Foreign business people working
in Vietnam have a good understanding of the local investment climate
but their parent companies do not. As a result, Vietnam should
enhance investment media, says Woicke.
By Hai Ly - The Saigon Times Weekly - December 15, 2001.
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