Vietnamese still doubt market economy

Vietnam’s transition to a market economy will be tougher than expected as even well-educated people still want to rely on state protection for economic security, a survey reveals.
According to the survey just released by the World Bank and the Vietnam Chamber of Commerce and Industry, the common attitudes of the majority of highly-educated Vietnamese about the role of the state in the market are mixed.
Of 892 people interviewed, 93 percent are university and post-university graduates and are working for the government, private businesses, foreign-invested firms, international donors and others.
An overwhelming number of these respondents (87 percent) prefer a market economy, while 7 percent say the state-led economy is better than the market economy and 6 percent say it does not matter.
Only 1 out of 4 agrees that Vietnam has become a market economy. The majority also advocate entrepreneurship, as up to 69 percent say they believe private ownership is better than any other forms of ownership, while 13 percent say state ownership of enterprises is better.
Ironically, however, an overwhelming rate (68 percent) of respondents think prices of common items consumed by households should be determined by the state.
Meanwhile, only 29 percent of respondents believe prices should be determined by market forces with no interference from the state, and 3 percent say it does not matter.
The mixed signals from the survey make economists and experts worry that the transition to a market economy would face resistance.
Economist Pham Chi Lan, former vice chairwoman of VCCI, said the survey shows the state is still needed in determining market forces when it comes to important items like petroleum, power, and air tickets.
“People have gotten used to state monopoly, so they’ve clung to state protection,” Lan said.
Meanwhile, economist Nguyen Quang A said he felt afraid that it would be worse for Vietnam if state agencies would continue to intervene in the economy based on such findings.
The survey shows that the number of respondents dissatisfied with the current state of the economy exceeds those satisfied by two to one, at 39 percent against 19 percent.
The World Bank’s chief economist Deepak Mishra concluded that most respondents prefer market-led economy, private ownership of enterprises, and greater transparency in decision-making.
However, they still approve intervention by the state to stabilize prices. He said that the group that seems most satisfied with the status-quo are those working for the government, the National Assembly and the Party, as well as private businesses and foreign enterprises.
On the other end of the spectrum are those working with international donors, social organizations and the media.
“Those working in the government are less enthusiastic about reforms than those working outside of the government, so Vietnam’s transition to a market economy is unlikely to be fast,” he said.
The survey is to support the Vietnam Development Report 2012 to be issued late this year by international donors. – Source:Vietbiz24.com

Tags: market economy, Vietnam economic news, Vietnam economy, Vietnam economy 2011, Vietnam’s transition

Posted by quynhdn on Oct 3 2011. Filed under Economy News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry