Bold action needed to empower Vietnam's entrepreneurial spirit

By Dam The Thai,

Email Print

Surfing around some websites to read the news, I happened to find an article by a Vietnamese-born professor in Japan.
The article reviews the growth development in the last three decades of Vietnam vis-a-vis other countries, acknowledging the achievements since the doi moi reform era began in 1986. At the same time it comments on the missed chances of the nation, pointing out that the growth rate for instance should have been further accelerated to around 10 percent instead of just 7 percent from 1990s to now. The article also exposes the potential risk of losing the limited time for maximizing the current golden population structure. However, it just addresses the issues without proposing the solutions.
I would like to share some personal views on hands-on how-to in order for Vietnam to maximize the existing golden opportunities for becoming a developed country.
The private sector should be further supported by the state to expand to its fullest extent, thereby contributing significantly to the development as a whole of the nation. Statistics showed that in 2012, the private sector was the largest contributor to GDP, at 49 percent compared with 32 percent from the state enterprise sector. Within 2006-2010, the private sector though with less investment capital of approximately 28 percent accounted for 55 percent of jobs in the country. The numbers from the state sector were 45 percent and 23 percent respectively. The great potential of the private sector in Vietnam has not yet reached its maximum level.
There has emerged so far an increasing number of successful non-state corporates with their products' fame reaching country-wide level, such as Vingroup, Masan, Vinamilk, Vietjetair, Thegioididong, FPT. Among those mentioned, the most noteworthy is Vietjetair. The company is not only well-known nationwide as a pioneer of budget airline but also recognizable internationally through its intentional purchase of a fleet of up to 100 Airbus planes in 2013. If Henry Ford did democratize the automobile and allowed everyone in the US at the time to afford one and have one then it may be said that Nguyen Thi Phuong Thao, the owner of Vietjetair, did democratize air travel and allowed a majority of Vietnamese people to be able to afford flying and to fly.
The airline industry in Vietnam is tightly strict. The domestic market is dominated by Vietnam Airlines, a state-owned carier, and there were some cases of failures of local private airliners who would like to enter into the playing field. Just after four years since the first flight in 2011, Vietjetair has been able not only to survive but also to thrive and fly high in the sky occupying 36 percent of the market share by the end of 2015.
Increasingly expanding business activities of a privately owned enterprise like Vietjet may also play a somewhat significant role to encourage the airplane maker, Airbus, to think of setting up a part of their manufacturing process in Vietnam, which promisingly shall help to facilitate and boost the engineering industry of the country.
The success story of Vietjetair shows the intelligence and resilience as well as the highly entrepreneurial spirit of local capitalists. Vietnam however needs to have hundreds of such cases like Vietjetair in each and every industries. They need the support from the state given the fact that in Vietnam there are not so many warriors combating alone albeit energetically and efficiently like Thao.
The process of Vietjetair-ization of the private sector in Vietnam shall need a series of bold actions from the state, both strategic plans such as reallocation of resources in all terms in a more unbiased and balanced way between the state and private sectors for the efficient use to its maximum extent and tactical measures like less procedurally administrative proceedings and more tax incentives.
In addition to the private sector-focused growth strategy, there requires an aggressiveness in institutional reform, beginning with reforms in human resources, especially the leader. I am not a fan of personality cult but it holds true that in some context sometimes there needs to be one single person or a few people who dare to gather the crowd and to lead the people in pursuit of a common good goal.
Vietjetair story above is a typical example for this idea, and in my opinion in a broader perspective the country is not an exception.
I find in men like Nguyen Ba Thanh, the late Party chief of Da Nang City and Dinh Lang Thang, the Party chief of Ho Chi Minh City, the leadership needed for Vietnam's human-resources-oriented institutional reform.
Their actions have helped stir up the old-fashioned management theme, which lacks the accountability and dynamics. They have applied effectively the good principles of Yamashita-Rule, which requires the gut of the leader and always keeps the top leader accountable and responsible for any wrongdoings under their management.
Thang and Thanh are the kind of modern and action-oriented bureaucrats of which this nation needs in the rough road of institutional reform to become a developed country.

More Opinion News

So long to the Asian sweatshop

So long to the Asian sweatshop

  In Asia, the factors that made sweatshops an indelible part of industrialization are starting to give way to technology.