Speeches & Transcripts

Opening Remarks at 2012 Annual Vietnam Consultative Group Meeting

December 10, 2012


World Bank Country Director for Vietnam, Victoria Kwakwa 2012 Annual Vietnam Consultative Group Meeting Hanoi, Vietnam

As Prepared for Delivery

Protocol
o Excellency Prime Minister Nguyen Tan Dung;
o Mr. Bui Quang Vinh, Minister of Planning and Investment;
o Governor Nguyen Van Binh
o Mdm. Pham Thi Hai Chuyen, Minister of Labour, Invalids and Social Affairs;
o Minister Pham Vu Luan, Minister of Education and Training;
o Members of the National Assembly;
o Vice Ministers;
o Leaders of Provincial People’s Committees;
o Your Excellencies Ambassadors;
o Colleagues Heads of Development Agencies;
o Ladies and Gentlemen

A very good morning to you all.

Welcome

• I join Minister Vinh in welcoming all of you to the 2012 Annual CG. 
• Excellency PM, I welcome and thank you for joining our discussion this morning.  We look forward very much to your remarks at the end of the morning session.  
• I extend a special welcome to Ambassadors and Heads of Agencies who are attending the annual CG for the first time and I welcome in particular the observer delegation from Myanmar.  I hope that your participation will give you some useful insights on how you may organize your own coordination and dialogue with development partners as your country opens up.  

Thanks

I want to thank all who have worked hard to prepare this CG: you Minister Vinh, your staff at MPI, other agencies in Government notably SBV, MOF, MOET, MOLISA, and MONRE, and of course my colleagues at the World Bank.  

I’d like to congratulate the Government for impressive gains in macroeconomic stability during 2012.  This has been made possible by the recognition of macroeconomic stability as an important priority, by strong political commitment and resolve, which has allowed the needed bold actions.  
 
At the same time Vietnam’s continued downward growth trend over the last few years — this year’s growth is the slowest since 1999—suggests that the economy is losing much of its dynamism and structural constraints are becoming more binding, dragging down the economy’s competitiveness and growth. 

Key structural problems – the over-extended state enterprise sector, weak banking and financial sector and inefficient public investment are well known and have been  identified by the Party and the Government as areas that need urgent restructuring. What is needed now is the same resolve, political commitment and flowing from this, demonstrable action.  Proper sequencing of action will allow some concrete early wins, which can build confidence in the Government’s efforts and leverage this for success of subsequent actions.    

Without determined and resolute action, the costs of addressing these challenges will rise. In some countries, the costs of addressing difficulties in the financial sector has been as high as 30-40% of GDP.  

Without resolute action, Vietnam also risks falling overtime into the middle income trap with weak competitiveness, a likely return to recurring instability continued widening inequality and inadequate social progress. Excellency PM Dung as your partners, we hope Vietnam will avoid going down this path and we look forward to being able to support you and your Government to move from planning to credible implementation and action. Firm and credible actions can attract much needed private resources to complement your own resources and what we as your development partners can bring to the table to address these challenges

Today we will also discuss two issues that will be important determinants of Vietnam’s ability to succeed as a MIC. Vietnam needs to build a well-skilled workforce to allow a move from low productivity, lower value added to higher productivity, higher valued added activity. Advanced skills are needed across cognitive, behavioural and technical domains. Developing these skills in the workforce will require the strengthening of the entire education system from early childhood development to basic, vocational and tertiary education to set a sound foundation for life-long learning.

How Vietnam manages its scare land resources is also important. Assuring secure land rights for farmers, more flexible use of agricultural land, strengthening the land use rights of vulnerable groups such as women, the poor, and ethnic minority communities, creating more transparent and equitable arrangements for land acquisition and compensation by the State and limiting the circumstances in which compulsory land acquisition may occur, and  improving the effectiveness of land planning management systems within an overall enhanced framework for land governance will all be critical for the efficiency and inclusiveness of Vietnam’s future development. We hope that these considerations will be reflected in the new Land Law to be adopted in 2013.

Over the last year, the Government and Development Partners have spent a considerable amount of time discussing how Vietnam’s CG should evolve to reflect the country’s new stage of development and the changing development partner landscape in Vietnam. 

This annual CG is the last in the current format which was designed about 20 years ago to serve primarily as an ODA resource mobilization platform. Today most development partners have their own bilateral ODA discussions and agreements and the resource mobilization function of the CG is no longer relevant. 

What is needed now is a platform for substantive and meaningful dialogue between the Government and partners in Vietnam’s development.  Twenty years ago, the key partners were Government and development partners.  

Today there are more partners in Vietnam’s development—civil society both international and local, as well as private sector. 

We hope that the new format going forward will embrace this wider group, allowing the collective wisdom of all stakeholders to be effectively tapped. 

Finally we would like the CG to become more action oriented and come up with concrete areas of follow up. 

I am confident that we are embarking on an exciting new phase of our dialogue and partnership as we move to a new format for the CG in 2013 and beyond. 

Excellency PM Dung we thank you for your support of this evolution, and look forward to your continued active engagement in the years ahead. 

Prime Minister, as development partners, we appreciate the opportunity to discuss with your Government Vietnam’s key development issues.  On behalf of all of us, I would like to reassure you that we approach this with a strong sense of responsibility and sincerity and hope that it does add value for you and the Government at this critical juncture in the country’s history. 

We should discuss openly, honestly and constructively, drawing on the trust and the goodwill that underpins our partnership.   

I urge all of us to keep our interventions focused and succinct and allow the opportunity for real dialogue by giving each other a chance to be heard and by actively listening to others.
I look forward to very fruitful CG.


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