Việt Nam ranks 4th in “well-being” study
Việt Nam ranks 4th in “well-being” study
Việt Nam ranks fourth out of 149 countries assessed on how well they convert national wealth into well-being of its population, according to business strategy advisor Boston Consulting Group (BCG).
The finding comes from an analysis conducted using the company’s sustainable economic development assessment (SEDA) and is detailed in its “Lotus Nation: Sustaining Vietnam’s Impressive Gains in Well-Being” report, which was released on Tuesday.
The analysis finds that Việt Nam, with per capita gross domestic product (GDP) based on purchasing-power parity of approximately US$5,200, has well-being levels that would be expected of a country with GDP per capita of more than $10,000. Việt Nam is also above average in converting economic growth into well-being improvements.“The latest findings indicate what we have believed all along – that Việt Nam’s success in harnessing its limited resources for the good of its citizens is impressive and comparable to higher-income countries,” Chris Malone, BCG partner and economic development expert based in Việt Nam, said.
“This is particularly noteworthy given the country’s remarkable pace of economic growth of about 7.1 per cent annually from 2006 to 2013,” he said.
However, the report says that big challenges lie ahead for Việt Nam, and the country needs action in three critical areas, such as employment, infrastructure and governance, to ensure its “impressive record”.
The report compares Việt Nam’s performance to that of four peer nations that like Việt Nam, have midlevel incomes: Malaysia, the Philippines, Thailand and Indonesia. The group is referred to as the ASEAN 4.
Việt Nam ranks near the bottom of the ASEAN 4 in income, infrastructure, governance and environment. While Việt Nam’s score in the employment dimension is in line with that of its ASEAN 4 peers, the country faces a number of significant issues in the labour market, including low labour productivity and a much smaller base of skilled workers that could create challenges in sustaining the current pace of development.
The report identifies concrete actions such as upgrading the workforce by improving the links between industry and providers of training and education, and by steering young people towards high-demand sectors. It also recommends a robust performance management system for the country’s education institutions.
Infrastructure requires an estimated investment of $113 billion to $140 billion by 2020, but only 50 per cent to 60 per cent of that can be funded through the government’s budget. Việt Nam should improve the way it plans and executes public-private partnerships in order to draw in more private investment and deliver the highest impact from investment, the report says.
Improving governance is the key to increasing the confidence of foreign investors in Việt Nam and will require the country to strengthen its institutions and use digital tools in order to help increase transparency. The government must also upgrade the talent in the country’s public service, the report says.
SEDA defines well-being through 10 dimensions: income, economic stability, employment, and health, in addition to education, infrastructure, income quality, and civil society. It is also defined by governance, and environment. It uses the most recent available data, and data from the past seven years.
