Competition sustains growth

SUSTAINS GROWTH is a simple terms referring to a business. It is the realistically attainable growth that a company maintains without running into problems.

Speaking at the Vietnam Development Partnership Forum 2015 (VDPF 2015), Prime Minister Nguyen Tan Dung affirmed that Vietnam has obtained remarkable achievements on many socioeconomic fields thanks to strong commercial relations between Vietnam and other countries. However, Vietnamese economy is also facing some huge challenges.

Competition sustains growth

Vietnam also places ambitious goals for five year period from 2016 to 2020 based on four main categories:

  • Obtaining higher and more sustainable economic growth;
  • Developing culture, ensuring of social welfares, considering the development of people living standard as an on top objective;
  • Protecting and improving environment;
  • Guaranteeing peace and stability.

Ms. Victoria Kwakwa, Director of World Bank in Vietnam, said Vietnam has gained a lot on the socioeconomic development strategy. Thus, the economic dimension almost doubles to US$200 billion. Poverty has continued to decrease quickly from 20.7% in 2010 to 13.5% in 2014. Moreover, nearly 95% of children under five years old go to kindergarten.

According to the World Bank, however, the downward trend in productivity growth should be taken into the account. Vietnam’s productivity growth rate is under 4%, which is far less than the figure for China with 7% and South Korea with 5%. These numbers do not reflect any sign of the sustained growth which is one of four major targets of Vietnam in the next five years.

Layton Pike who is Australian Deputy Ambassador in Vietnam suggest the Vietnamese government gradually transfer their ownership in companies operating in non-public sector and relocate its resources to strategic areas such as infrastructure development and governance quality improvement. It will not only promote the competition among enterprises, but it also lowers the government’s burden.

Obviously, sustainable growth is a prime concern of both business owners and the government. However, achieving this goal is not easy, especially in Vietnamese politic and economic conditions. In recent years, almost all of domestic companies carry out cost reduction plans, means that they should attract customers by enhancing value and self-distinguish among other competitors. That is prerequisite for sustainable growth in business sector.

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