Institutional breakthroughs to provide solid foundation for heightened business confidence: economists

At a meeting of the National Assembly's Economic Committee in early February, the government proposed the 2025 GDP growth be "8% or more", instead of 6.5-7% set last November. The Investor introduces opinions of some leading Vietnamese economists on this proposed target.

Nguyen Duc Kien, former head of the Prime Minister’s economic think tank

While 2024 presented many challenges, we exceeded expectations. This is an exciting and commendable achievement. But we must ask: "Did this growth rate meet the development target outlined by Party General Secretary To Lam?"

Our goal is to build a prosperous, happy Vietnam; become a modern industrial nation with a high average income by 2030, and a developed, high-income country by 2045.

To reach this, GDP per capita in 2030 should be around $7,500 per year, and by 2045, it should rise to $13,000-15,000 per year which triples our current tally of $4,800. Achieving this means striving for double-digit growth over the next two decades. That’s why I say we should be "very happy" because the road ahead is still long and challenging.

Beginning in 2025, we need a major change, a turning point that sets the stage for reaching our strategic goals, including the national planning objectives and aspirations for 2030 and 2045. A key goal here is robust GDP growth. Without big economic expansion, we won’t achieve any of the other objectives.

Looking back over the past four decades of Doi moi (reform), we see that while Vietnam has grown stronger, more beautiful and more influential, GDP growth has slowed over time.

In the first decade, GDP grew by 7.6%, followed by 6.6% in the second decade and 6.32% in the third. If GDP growth in 2025 reaches only 7-7.5%, the average GDP growth for this fourth decade will only be around 5.9-6%.

This represents a continued decline. If growth remains at these levels, it will be insufficient to meet the ambitious goals set for 2030-2045. Moreover, we risk falling further behind in technology, economic development, and other key areas.

For the country to become strong, powerful and prosperous, we must prioritize growth. This growth must be in double digits to create momentum needed for the next phase of development.

2025 is the final year to accelerate efforts to meet the five-year plan for 2021-2025 and achieve the goals of the 10-year strategy for 2021-2030. It is also the year of the 14th Party Congress, which will lay the groundwork for the next phase of development.

The goal is clear, the aspirations are high, and expectations are rising. Clearly, change, breakthroughs and acceleration are necessary to create a turning point that will propel us forward. This is our opportunity to set the nation on an upward trajectory in the new era.

Party General Secretary To Lam once said: “This is a very difficult task, but we certainly have the foundation to accomplish it."

Nearly 40 years after the reform process began, we’ve achieved significant progress. To reach the next set of goals, we need to embrace a new approach, what I call a “second reform,” beginning right in 2025.

Can Van Luc, chief economist of BIDV and member of the National Monetary and Financial Policy Advisory Council

The BIDV research team has outlined three GDP growth scenarios for this year. In the base case (60% probability), Vietnam's economy is projected to grow by about 8%. In the positive scenario (20% probability), the economic expansion is 9-9.5%. In the negative scenario (20% probability), the figure is 7-7.5%.

Therefore, the target of 8% GDP growth for Vietnam this year seems achievable. However, the key to success lies in making institutional breakthroughs, "revolutionarily" streamlining organizational structures, and tackling inefficiencies quickly and decisively.

This includes completing mergers and restructuring to make the administrative apparatus leaner and efficient. At the same time, it’s critical to intensify the fight against corruption, particularly waste, with a focus on five key areas: land, real estate, public assets, public investment, and resources.

The government must implement breakthrough policies to build a team of civil servants and public employees who are highly qualified and committed to their roles. This includes implementing salary reforms, creating incentives, and providing protection for officials who are courageous enough to speak out, take action, and accept responsibility for the greater good.

Additionally, the government needs to enhance the coordination and effectiveness of its policies, especially among fiscal, monetary, price and other macroeconomic policies. This will help stimulate high growth, control inflation, stabilize the macroeconomy, maintain exchange rate stability, and safeguard financial and monetary markets, all while ensuring social security.

I am confident that with the important successes we’ve seen so far, institutional breakthroughs will provide a solid foundation for strengthening business and public confidence, which in turn will drive rapid economic growth.

Nguyen Dinh Cung, former director of the Central Institute for Economic Management (CIEM)

The government recently issued Resolution 25/2025/NQ-CP, setting growth targets for various sectors and localities to ensure the national growth target for 2025 reaches 8% or higher.

This approach can be seen as a macroeconomic management strategy aligned with the need for somprehensive and strong decentralization, following the principle of "localities decide, localities act, localities take responsibility."

It is important to note that, according to the development plans of provinces and centrally run cities approved by the Prime Minister, each locality has set its growth target at over 10%. These plans also outline breakthrough tasks, development directions for sectors and regions, and a list of priority investment projects to meet these growth goals. In practice, localities have set high growth targets and clearly identified the tasks they need to accomplish.

However, with the issuance of Resolution 25, the government has implemented a "growth assignment" mechanism, which defines the responsibility for both the quantity and quality of performance for localities.

At the same time, it also clarifies the government’s responsibility in supporting localities to meet their growth targets. If most localities achieve a GRDP (Gross Regional Domestic Product) growth of over 8% this year, national GDP will certainly surpass the 8% target. Similarly, if we aim for double-digit growth in the years ahead, most localities must achieve GRDP growth of over 10%.

But setting high targets requires the right incentives and enough flexibility for localities to leverage their talents and complete their tasks effectively. The necessary flexibility involves thorough and comprehensive decentralization, which follows the principle of "localities decide, localities act, localities take responsibility."

This means localities should not only decide "what to do" but also have the autonomy to determine "how to do it" without needing approval or consultation from central or superior agencies. Localities must be empowered to apply and enforce legal regulations flexibly.

In cases where legal regulations are unclear or conflict, localities should have the right to choose the most appropriate regulation to resolve the issue. In situations where there is no legal framework or no clear legal framework, they should be allowed to apply the most reasonable and effective solutions.

Moreover, the assessment of government performance should be based on objectives, results, and overall effectiveness, rather than strictly on procedures and regulations. A failure or lack of success in one project should not undermine the achievement of overall goals as reflected by these indicators.