Experts warn of low productivity results

Low productivity growth Dr. Nguyen Dinh Cung, Director of the Central Institute for Economic Management (CIEM), said Vietnam reached an annual labor productivity growth of 4.8 and 4.3 percent and a yearly economic growth of 7.3 and 6.7 percent in 1990-2000 and 2000-2012, respectively. The country’s labor productivity was unstable in recent years, falling to its lowest level – 3.8 percent – in 2013 and rising to 6.5 percent in 2015, leading to an annual economic growth of only 5.96 percent in the 2011-2016 period. According to Minister of Planning and Investment, Nguyen Chi Dung, 2017 was a successful year of Vietnam, which fulfilled or exceeded all of the 13 socioeconomic development targets set by the National Assembly, including gross domestic product (GDP) growth of 6.7 percent. However, Vietnam’s growth quality remains modest, which is mainly attributed to modest labor productivity. Ousmane Dione, Country Director of the World Bank in Vietnam, said Vietnam’s average labor productivity growth is about four percent, much lower than the seven and five percent that China and the Republic of Korea (RoK) reached when they were at the same level of development as Vietnam. If Vietnam continues with its current rate of productivity growth, it won’t be able to keep pace with such countries the RoK and Singapore, he warned. Economists say that if Vietnam doesn’t improve its labor productivity, it won’t be able to lure large, quality investment projects. Education is key Forum participants said Vietnam needs a skilled workforce, noting that currently, only… [Read full story]

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