"Vietnam needs a second Doi Moi with stronger, more profound reforms"
Báo điện tử VOV•23/10/2024
VOV.VN - Mr. Kamal Malhotra, former Resident Coordinator of the United Nations in Vietnam, said that after nearly 40 years of achievements in Doi Moi, Vietnam is standing at a very important threshold to enhance its own development.
After nearly four decades of Doi Moi and opening up, Vietnam has achieved great achievements in hunger eradication, poverty reduction and economic development. However, past achievements are also putting Vietnam at a very important threshold to enhance its own development. This is the affirmation of Mr. Kamal Malhotra, former Resident Coordinator of the United Nations in Vietnam, in an interview with VOV's resident correspondent in India. Mr. Kamal Malhotra has more than 30 years of experience in Vietnam's development and transformation.
Vietnam needs a second Innovation with a stronger development ambition than the first Innovation.
Reporter: Thank you for joining us in this conversation. We mentioned Vietnam's ambition and aspiration to become a developed country by 2045. This goal is based on the important political and economic achievements Vietnam has made after the Doi Moi process over the past 40 years. What do you think about this?
Mr. Kamal Malhotra: I think it is a remarkable change in Vietnam since 1986, when the Doi Moi process began. I don't think any other country has been able to transform so quickly and from such a low starting point, after the devastation of war. But let's be aware that there is a difficult road ahead.
If Vietnam's annual GDP per capita was around $200 to $300 in the mid-1980s, it is now closer to $4,000 per year. But to reach the minimum level of 'high income' status as calculated by the World Bank (WB) by 2045, Vietnam will need to reach a minimum of $14,000 per capita per year by that time. This will be very difficult. And Vietnam must also be careful not to get stuck in the lower middle-income trap. These are real risks for Vietnam in the current situation. We see the benefits and risks brought by Artificial Intelligence (AI) in the next few years, creating many new technologies, but also bringing economic and political challenges to Vietnam. Therefore, in 2024, Vietnam is facing important turning points in the 21st century - like the Doi Moi period in 1986 and in 1945, 1954 and 1975 before.
Former UN Resident Coordinator in Vietnam Kamal Malhotra has over 30 years of experience working in Vietnam.Reporter: So how do you view the leadership role of the Communist Party of Vietnam in the overall development of the country?Kamal Malhotra: Under the leadership of the late General Secretary Nguyen Phu Trong, the Communist Party of Vietnam has played a very important role, leading the development of the country. General Secretary Nguyen Phu Trong is the most prominent Marxist-Leninist theorist that Vietnam has had in the past three decades. He is also famous for his Bamboo Diplomacy. Inheriting and realizing the legacy of General Secretary Nguyen Phu Trong is something that Vietnam is promoting in the context of a completely changed 21st century geopolitical landscape. And to do that, I think Vietnam needs Doi Moi 2.0 with the ambition to develop more strongly than Doi Moi 1.0 in 1986 - the period when Vietnam mainly focused on "economic innovation". Doi Moi 2.0 needs to emphasize a long-term economic strategy that allows Vietnam to develop more strongly. Reporter: Vietnam aims to become a developed economy by 2045. How do you assess the feasibility of this plan?Mr. Kamal Malhotra: As I mentioned, Vietnam wants to become a “high-income” country by 2045. To become a “developed” country, of course, Vietnam will need to make more efforts. In fact, the criteria for becoming a developed country (according to the World Bank) is that each country must achieve an annual per capita income of at least 14,000 USD. Currently, Vietnam’s annual per capita income is still below 4,000 USD. That means Vietnam must set many goals to strive for in the next 20 years. But that is only one factor. Vietnam will have to carry out stronger and more extensive reforms, such as reforming the judicial system, investing in human resources, intelligence and nurturing new generations of leaders capable of leading the country in all aspects. Reporter: There are many obstacles for Vietnam, both internally and externally, if it wants to achieve its goals in the next 20 years. How can Vietnam overcome these challenges, sir?Mr. Kamal Malhotra: As I said, Vietnam needs a second Doi Moi. But Doi Moi 2.0 must be different from Doi Moi 1.0. Doi Moi 1.0 was very successful, but much easier, because what Vietnam needed to do then was to rise from the difficulties after the war. But Doi Moi 2.0 means that Vietnam must go from a lower-middle-income country to a developed country. Economically, that means Vietnam needs highly qualified, high-tech human resources to avoid falling behind in the AI era and becoming dependent on AI.
Vietnam increased its average income 40 times between 1989 and 2023.
Reporter: Back to the path that Vietnam has taken since the Doi Moi. What do you think about Vietnam's efforts to achieve the Sustainable Development Goals over the past 10 or 20 years?Mr. Kamal Malhotra: Vietnam has done very well to achieve the Millennium Development Goals, all 8 of which Vietnam achieved before 2015. That is commendable. The Sustainable Development Goals agenda set by the UN, to be achieved by 2030, is an agenda based on human rights. Therefore, along with taking care of economic and social development - issues that Vietnam is doing quite well, Vietnam needs to further promote ensuring social rights and security for the people. In addition, there are other major challenges related to climate change and the environmental front. And Vietnam is facing two major challenges. That is the problem of plastic waste pollution. For example, when tourists come to Hanoi or other places in Vietnam, everywhere is full of plastic waste. Vietnam must take environmental cleaning seriously. Secondly, Vietnam needs to develop small and medium enterprises in strategic areas and on an international scale to be able to increase international competitiveness. However, I want to emphasize that Vietnam has achieved excellent results in reducing multidimensional poverty. But you should not be subjective and need to go further. The poverty rate in Vietnam has been reduced to about 4%. This is remarkable, but more efforts are needed.
Former United Nations Resident Coordinator in Vietnam in a conversation with VOV reporterReporter: So what about the most notable achievements in poverty reduction since the beginning of Doi Moi, sir?Mr. Kamal Malhotra: I think the most important achievement is that Vietnam has lifted about 40 million people out of poverty in the past three decades, out of a total population of about 100 million. Vietnam has also halved its multidimensional poverty rate since 2005. Absolute poverty has now fallen to about 4-5%. It is impressive that Vietnam has increased its per capita income by 40 times between 1989 and 2023. But as I said before, Doi Moi 1.0 was easier for Vietnam, while Doi Moi 2.0 will be a challenge if Vietnam wants to achieve developed country status or even just 'high income' status by 2045.
Vietnam is the only country with a chance to escape the middle-income trap.
Reporter: In the beginning of our conversation, you mentioned the Middle Income Trap. Many countries have encountered this situation and got stuck in it. What lessons can Vietnam learn from this, sir?Mr. Kamal Malhotra: You will see that Korea in the 1960s and 1970s had to overcome many challenges to prevent falling into the lower middle income trap. They had to address the issue of social policy. They had to address investment in education at all levels. Vietnam is doing well in investing in education at the basic level, but it needs to focus on investing in higher education. Vietnam needs to learn from Korea's successful example in this regard. Higher education goes hand in hand with academic freedom. Another example is that Vietnam needs to look at the experience of the small and medium enterprises group in Taiwan (China). This is one of the very few places in the world that has so far escaped both the lower middle income trap and the middle income trap. Today, some countries like the Philippines, Thailand, Indonesia and Malaysia are stuck in this situation. In my view, and as I said this a few years ago, Vietnam is the only country that has a chance to escape the middle income trap but it will take a lot of effort, with world-class technocrats and economists. Reporter: Thank you, Mr. Kamal Malhotra, for the interview.
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