Sunday, 22/10/2017
Implementing sustainable development policies in Vietnam at present
4/10/2017 13:50' Send Print
Sustainable development is a global concern. Source: tapchitaichinh.vn

Difficulties and challenges for sustainable development

The Political Report of the Central Committee of Party, 11th Ternure on 30 years (1986-2016) of sustainable renewal and development of the country identifed many contraints and limitations. Macroeconomic growth has increased but not sustainable; problems in education and training, science and technology, socio-cultural fields were not sustainably resolved; Constraints in management of resources, environment and response to climate change resulted in implications that threaten sustainable development.

Difficulties and challenges to sustainable development in Vietnam are shown in several aspects:

There has not been great changes in awareness, sense of responsibility on protection of natural resources and environment among cadres, public servants and society. Several Party committees, authorities, unions and people have not fully aware of the value of resources toward survival and sustainable development, and understood that development of green growth and green economy are means for sustainable development in society. Consideration has not been given to overall and equal interests and benefits among concerned stakeholders and generations while harnessing resources for economic development and generating budget revenue.

There are a number of contrainsts in policy framework, laws and the state management of resources protection. Policy solutions have not been taken to ensure consistent implementation of the principle that resources are national capital, assets, resources and living environment for sustainable development. Policy solutions to encourage the development, and use of renewable energy, new energy, promote and encourage the thrift, rational, effective and sustainable use of resources for sustainable development have not been fully developed. Solutions and policies on environmental protection have not been synchronized with those of market economy institutions; solutions and policies towards new environmental issues have not been complete. Stakeholders’overlapping and unequal participation in environmental and resource protection, especially in waste management, biodiversity and intersectoral and interregional environmental and resource issues have remained.

In addition, compliance with policies and laws on resources management and environmental protection is not strict, coordination between ministries, branches and localities is poor. Compliance with legislations and policies is weak. Non compliance, lack of management in resources and environment in many localities are quite common, especially in the management of mining, waste water, and gas emission. Information in the management of resources and environment, especially in terms of land and waste is not transparent. There are limitations in effective management of intersectoral and interregional resources and environment.

Inclusion of environmental and resource issues in development decisions has not yet met the requirements of sustainable development. The issue of resources and environment has not been fully taken into account in policy development and implementation. Monitoring of the implementation of new policies on resources and environment has been carried out in only some aspects, and fields mainly focusing on environmental sanctions rather than prevention. Many pressing environmental issues, such as protection and conservation of biodiversity and resources, the thrifty use of natural resources, energy and water resource protection have not yet included in policy monitoring.

The ineffective and unsustainable exploitation and use of resources have resulted in some resources’ exhaustion which cannot guarantee resources for socio-economic development in the future. Wasteful use of land, ineffective use of land, forest, water and mineral resources, fragmented exploitation and mining of mineral resources, obsolete exploitation and processing technology are other problems. Aquatic resources in the watersheds and coastal areas have been overexploited leading to their inability to regenerate and restoration.

Meanwhile, environmental pollution tends to increase in both urban and rural areas. Sources of environmental pollution have rapidly increased in quantity, scale and level, causing negative impacts on environment, poluting land, water, air in many places, very serious in some places. Pollution of water source and river basins and sea tends to increase. Air quality in major cities is declining.

Biodiversity depletion threatens large scale ecological imbalance. Natural ecosystems have been shrinking. Primeval forests have been reduced. The number of endangered species and plants has increased. River, lake and lagoon ecosystems are overexploited. Marine ecosystems, such as mangrove forest, coral reefs, seagrasses, and biodiversity have degraded and shrunk. Conservation of indigenous genetic resources, and control of invasive alien species, management of genetically modified organisms are still inadequate.

Science and technology have not made much practical contribution to the protection of resources and environment. Research and activities to protect resources and environment have been still limited. Low capacity of and and low level of technology application, use, processing of resources and environmental protection have been identified.

Investment and recurrent expenditures have come mainly from the state budget and fallen short of expectation; resources mobilized from society is limited; financial management is poor. Annual recurrent expenditures for environmental, though reaching 1% of the total state budget expenditures, are far below demands and have been mainly focused on waste management and management apparatus. Mobilized resources are small. Official Development Assistance (ODA) for environmental protection is low, scattered and decreasing.

Database for resources and environmental management remains limited; information on resources and environment is not transparent. The information system for monitoring, and supervision of resources management, environmental protection and sustainable development is seriously deficient. People and communities’ access to information on resources and environment is limited. Complaints and petitions about resources management, and environmental protection have increased and complicated.

Macroeconomic growth is not stable. State budget balance faces difficulties; the structure of budget revenues and expenditures is not suitable. Credit quality is not high. There are difficulties in bad debt settlement. The capital, security, real estate markets’ development is not synchronous with slow recovery and potential risks. In the period of 2011-2016, the average growth of gross domestic product (GDP) was lower than the previous 5 years; agricultural production gained low efficiency; industry and servicess growth was lower than in the previous period. Business performance is not high; Large-scale enterprises are few in number. National competitiveness is not much improved, especially in terms of economic institutions, infrastructure and technological innovation.

Investment efficiency, especially public investment, is on a downward trend and stands at low level. Investment decentralization mechanism is inadequate, wasteful, inefficient and this has led to dependence of localities on the central level. Frangmented investment, slow progress, bad debt in capital construction have not been thoroughly overcome. Management, process, and allocation of investment have not been transparent. Private sector’s resources have not been mobilized at the highest level for development investment. Financial and bank restructuring have been delayed and failed to achieve objectives; State-owned enterprises’ restructuring through equitization and state capital withdrawal has been delayed.

Vietnam's financial and monetary market has been relatively low and inadequate. Although basic components have been made available, the financial system has still relied heavily on commercial banks; non-banking financial institutions have played a fairly limited role. Modern banking services have not yet developed. Stock market has been still very small with limited type, size and membership.

Exports and imports have depended quite a lot on the outside, and so all fluctuations of the world have quickly affected domestic economy. The quality of Vietnam’s economic openess has been still low with high proportion of raw materials, initially processed goods and assembled goods in the total export turnover; support industries have developed slowly hence low export value; the import of raw materials and auxiliary materials has been quite high.

The job market has not fully developed, workers have to accept low quality jobs, low wages in the nonformal economy, or accept informal employment agreements to earn a living. Therefore, although the unemployment rate of Vietnam is currently low, in the long term it is a negative factor. Laborers are less motivated to improve their qualifications and skills due to the lack of pressure on labor standards.

Vietnam's public debt is still under control, but in terms of its debt structure, the problem may actually be more serious. There are discripancies in public debt and foreign debt of Vietnam from different sources and at different times so risk assessment of public debt cannot be based on debt record books. Though bad debts of State-owned enterprises are not guaranteed by the Government, when faced with solvency, state budget is still used for payment. State budget deficit and public debt tend to increase in recent years. Public expenditure of our country is very high. Government spending in Vietnam has accounted for more than 30% of GDP in recent years (1). Budget overspending continued to increase from the projected VND 224 trillion in 2014 to VND 226 trillion in 2015.

There remain constraints in cultural development and social progress. The life of a part of the people is still difficult. The development of an advanced culture imbued with national identity falls short of requirements. Degradation of ethics, lifestyle causes resentment among people; social evils are complicated. Management of cultural, artistic and festive activities is not good in many aspects. Cultural life, especially in remote areas, is still limited. Management of information, media, especially internet governance is still inadequate. Poverty reduction results are not sustainable with high risk of relapse; the gap between the rich and poor, between regions, communities is still large. Labor restructuring is slow; labor proportion in the agricultural sector remains high.

The quality of public service delivery is limited. People's healthcare and quality of medical examination and treatment, especially at grassroots level have not met requirements. Life expectancy increases but the quality of life is not high. The quality of education, training, especially higher education and vocational training is low compared to requirements, hence lack of high quality labor. The education system lacks continuity of levels as well as synchronization. Training does not associate with science research, production, business and demands of labor market.

Orientations and solutions for better sustainable development policies

Given the United Nations’ 2030 Agenda for Sustainable Development shifting from the Millennium Development Goals (MDGs) to global Sustainable Development Goals (SDGs) on the global scale, to achieve better sustainable development policies in the next stage environmental protection must be placed at the forefront; economic growth must be linked with environmental protection and settlement of emerging social issues. Democracy and justice will also be important requirements in the implementation of sustainable development policy.

To complete policies for sustainable development in the next stage, it is necessary to strengthen environmental protection, implement economic restructuring policy in association with reforming the growth model, developing the economy with green growth, clean energy, renewable energy and implement policies to ensure food security, develop sustainable agriculture, rural areas, regions, areas and localities, remove bottlenecks in policy towards state-owned enterprises and investment. In other words, while implementing policies for economic growth, it is necessary to attach importance to the implementation of social policies, and policies on protection of resources and environment and response to climate change.

Continue reforming the market economy, create a healthy and fair competitive environment for all industries, sectors and enterprises in line with international commitments and international integration roadmap. Speed up the process of SOE reform. Maintain macroeconomic stability, promote restructuring to improve the efficiency of the economy, create an environment that encourages businesses to continually innovate. Continue to improve investment efficiency, mobilize funds for economic growth. It is important to attract domestic and foreign capital to develop medium and long-term capital markets through speeding up equitization and restructuring the stock market. Develop financial markets, debt trading markets, emerging financial instruments, and leasing of assets. Improve the performance of the monetary market; open credit market and banking services to meet development requirements and in line with international commitments. Implement fiscal policy to strict manage state budget revenues and spending, with the state budget-to-GDP ratio averaging around 20% - 21%.

Complete green growth policy, and develop clean, and renewable energy. Enhance understanding and awareness of green growth, helping communities in society, especially the business community, acquire correct awareness and understanding, thereby taking practical actions to contribute to sustainable development. Implement policy to improve efficient energy use, reduce energy consumption in production, transportation and commerce; gradually change the fuel structure in industrial production and transportation, such as the use of new, clean, renewable energy with less greenhouse gas emissions. Attract and mobilize investment sources for the development of clean and renewable energy along with a reasonable and appropriate price policy and encourage the use of this energy in production and daily life.

Enhance the operation of market-based instruments to boost production, consumption of clean energy, renewable energy with less “greenhouse gas” emissions, such as carbon tax, fossil fuel energy quotas, formation of domestic carbon finance market. Study and issue quotas (norm quotas) on production and consumption of clean energy and renewable energy. Set export and import tax rates for eco-products in line with the international and regional integration roadmap in order to boost production, import and export of environmental-friendly products. Attract the private sector’s invest in climate change response, green growth in the form of technology change/pilot project/case studies, public-private partnerships (PPP) in the field of infrastructure construction, and production of clean electricity.

It is necessary to have solutions on sustainable production and consumption and policies to encourage organizations and individuals to invest in the production and trading of environment-friendly products. Integrate sustainable production and consumption into national and sectoral development plans, and economic development, environmental protection and poverty reduction programs. Advocate and encourage environmental-friendly lifestyles, sustainable consumption, sense of environmental protection, build a society with less waste, and low carbon, and live in harmonious with environment. Create close relation between green producers, green products and "green consumers."

Promote the renewal of technology; gradually apply clean and environment-friendly technology. Harness and use resources in a sustainable way; increase the use of new and renewable resources instead of exhaustible resources.

Step up the development of environmental industry, develop and scale up green business models and adopt price support policies for green products and services; enhance marketing and advertising of green products and services. Develop a system of standards and certification for a green, environment-friendly distribution model.

Sustainable development must ensure food security, sustainable agricultural and rural development. The restructuring of agriculture should focus strongly on restructuring public investment and public services in agriculture, creating an enabling environment for effective and sustainable formation of agro-based agricultural value chains based on comparative advantages of each region and locality. Scale up high-tech agriculture, wide application of science and technology, especially biotechnology, information technology in agricultural production and management.

Step up agricultural insurance market, strengthen farmers' response to risks, ensure that agriculture is less vulnerable to climate change; localities, especially those in low terrains, should work out timely response plans and arrange suitable agricultural production.

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(1) The Economic Commission of the National Assembly and United Nations Development Program (UNDP): Report on Public Debt, 2013

This article was published on Communist Review No. 898 (August 2017)

Prof. Do Phu Hai, PhDUniversity of Home Affairs, Ministry of Home Affairs