Towards a Shared Vision and Strategy for Vietnam's Development

Washington Contact:	Loty Salazar (202) 458-2559 Fax (202) 522-3405
Hanoi Contact:		Ha Thanh Hoang or Lucy Oh (84-4) 8432-461 (09) 043-5115 Fax (84-4) 8432-471

HAIPHONG, June 15, 1999  Over 120 delegates from donor countries and institutions met today with officials from the Government of Vietnam to do a mid-year assessment of the progress made since last year's Consultative Group (CG) meeting in Paris and to review new development prospects for stimulating economic growth in Vietnam.

Deputy Prime Minister of Vietnam, Mr. Nguyen Manh Cam, head of the delegation, said, "I think that this was an excellent opportunity for representatives from important Ministries of the Government of Vietnam, donor communities, and non-governmental organizations to bridge the gaps and to better understand and act upon the current development difficulties facing Vietnam. The time is now ripe for us to develop an efficient and long-term cooperation so that we can go beyond the agenda and focus on solving these problems in a way that satisfies the needs of all parties."

The second mid-year follow-up meeting also included for the first time Vietnam Women's Union, representatives from six provinces, and international business participants from the Private Sector Forum held yesterday, who provided a more comprehensive view of development to the mix of international government and non-governmental participants.

Discussion at the mid-year meeting further developed the issues raised at last year's CG meeting:

• Vietnam's Doi Moi reform program, especially enterprise and banking reform and the climate for the private sector
• Rural Development and poverty reduction
• Good governance and fiscal transparency
• Aid effectiveness and partnership
• Donor support to Vietnam

The morning session looked at assessing the progress made since the December 1998 CG in Paris, while in the afternoon participants discussed ways to look ahead in moving towards more long term development. A new theme raised at today's meeting was the need for a new approach to support the public administration reform program.

Minister of Planning and Investment, Mr. Tran Xuan Gia made assurances that the Government would be taking strong measures to develop a public administration reform strategy. "A public administration reform strategy is one of the initiatives that will help to curb corruption and to alleviate poverty in Vietnam," he said.

The international donor community praised the efforts made to date by the Government of Vietnam and offered suggestions on how the country's reform program could be accelerated.

"Vietnam's economic slowdown threatens to undermine the impressive progress in reducing poverty in the past decade," said Mr. Andrew Steer, Director World Bank in Vietnam. "And the dialogue between the Government and the donor community today was frank and very productive, however, the coming year will determine the level of success of reform."

United Nations Resident Coordinator, Mr. Edouard Wattez added, "the crucial element to reform at this stage is more productive partnerships led by the Government at all levels to ensure quality and strategic' development assistance. In order to establish sustainable investments there needs to be targeted training and institution-building beforehand."

Leading up to the mid-year CG meeting was a separate private sector investors forum that was organized by the International Finance Corporation (the World Bank's private sector finance arm) and the Vietnam Chamber of Commerce. The forum enabled domestic and foreign private sector participants to discuss policy and institutional reforms that are necessary for "leveling the playing field" between the private and state-owned enterprises. In two specific areas -- banking and legal sectors -- where the need is quite urgent, the participants agreed to form joint working groups to encourage further dialogue.

The total aid pledged at the Consultative Group meeting last year in Paris was US$2.2 billion, with another US$500 million offered specifically to support an accelerated reform program. In addition, Japan has recently agreed to provide US$160 million to the Government of Vietnam to assist reform efforts.

Today's Mid-Year Consultative Group was coordinated by the Government of Vietnam, the United Nations Development Program and the World Bank.