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Sep 1, 2010 (Vol. 30, No. 15)

Vietnam on Path to Free Market Economy

Economic Liberalization Has Produced Some Results, but Much Work Remains to Be Done

  • Ever since Vietnam launched its “doi moi” economic liberalization policies 15 years ago, many have predicted that the country will be the next Asian tiger. This presumption has been reinforced by the stunning success of China’s market-driven economy. Vietnam and China have many similarities including full political control by the Communist party and an economy that is moving toward the free market.

    With a population of 86 million, Vietnam has a per capita GDP of $2,500,  and the GDP has grown an average of 6.4% annually over the past five years. The annual per capita pharmaceutical expense is just $16.13, although that number is projected to rise to $60.30 by 2019. The country’s large population and expanding economy will provide many commercial opportunities in the years to come, as will its proximity to China. 

  • R&D as a State Function

    Click Image To Enlarge +
    One of the goals of the “General Plan for Developing and Applying Biotechnology in Vietnam until 2020” is to modernize the country’s biomedical sector. [BSIP/Photo Researchers]

    The Vietnamese government has placed a strong emphasis on biotechnology in order to modernize the country’s agricultural and biomedical sectors. The “General Plan for Developing and Applying Biotechnology in Vietnam until 2020” addresses the country’s economic development objectives.

    The Ministry of Science and Technology will spend $15 million to fund R&D in several of the national laboratories, including the Institute of Biotechnology, the Vietnam Agricultural Science Institute, the Agricultural Genetic Institute, and the Institute of Tropical Biology.

    Increasing the pool of scientific manpower is a priority in Vietnam and encompasses two phases: producing more than 8,000 graduates and postgraduates by 2010, and then training another 12,000 scientists by 2015. Strengthening the science and technology (S&T) infrastructure is another priority. This will be accomplished through regulations, new management practices, production development, and the importation of genetically modified organisms. Crops of particular importance include rice, sweet potatoes, papaya, cotton, and maize.

    The S&T infrastructure shows the influence of the French and Soviet systems. In the Soviet S&T model, research is conducted at government institutes and instruction is the responsibility of the universities. A major flaw in such a system is the lack of technology transfer from the laboratory to industry and agriculture.

    Two important institutes were established during French colonial rule— Pasteur Institute Ho Chi Minh City and the Pasteur Institute Nha Trang. Both are under the Ministry of Health. The Pasteur Institute pursues research in dengue fever, HIV, diarrheal diseases, leptospirosis, and poliomyelitis. The Nha Trang institute pursues research in microbiology, immunology, and environmental surveillance.

    Vietnam hopes to fuel growth in the private sector by providing tax incentives, encouraging the creation of start-up companies based on technology developed at government institutes, and opening high-tech science parks.

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