Ho Chi Minh City renews growth model

Sunday, 2018-11-11 15:17:26
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NDO – Over the years, Ho Chi Minh City's economy has been continuously growing at a high level, contributing significantly to the development of the country. However, according to experts, in order to develop a sustainable economy and keep pace with global trends, the city should synchronously implement measures to continue renewing the growth model in association with raising the quality of growth, labour productivity and competitiveness.

Transformation based on science and technology

The world is entering the fourth industrial revolution (also known as Industry 4.0), with the power of innovation. Not to be out of the trend, many businesses in Ho Chi Minh City are trying to modernise technology that aims to increase competitiveness and improve product quality, and participate in global supply chains. Minh Nguyen Industrial Supporting Joint Stock Company (Minh Nguyen), at the Saigon Hi-Tech Park (SHTP), is the first domestic supporting industry enterprise to directly participate in the supply chain of high quality components for Samsung. Chau Ba Long, General Director of Minh Nguyen, said: "To be selected by Samsung as the first-class supplier of supporting industrial products, Minh Nguyen has paid attention to the investment strategy of automation technology. It not only improves the quality of products but also provides a large number of orders of Samsung in particular and other units in general.
Minh Nguyen is currently negotiating with Samsung and other partners in European and North American markets. In order to gain results, Minh Nguyen has received a lot of support from the authorities of Ho Chi Minh City and SHTP, which created favorable conditions for the investment environment as well as preferential policies on tax and high quality human resources, General Director Ba Long added.

SHTP is a location to attract high-tech projects and is a centre for research, transfer and the replication of advanced science and technology products for the city in particular and the whole country in general. Currently, SHTP is implementing a project of building and developing Sai Gon Silicon Park. Assoc. Prof. Dr. Le Hoai Quoc, Head of SHTP Management Board, said that after commencing operations, Sai Gon Silicon will help Ho Chi Minh City to close the gap in the level of science and technology with the world and the region. The project aims that, by 2025, SHTP will strive to become the leading hi-tech centre in Southeast Asia, which will provide and nurture innovative science and technology opportunities, he added.

However, according to experts, although the science and technology foundation in Ho Chi Minh City has made remarkable changes in recent years, the results have not been as expected. Prof. Dr. Nguyen Trong Hoai, Vice President of the University of Economics Ho Chi Minh City, said that it is necessary to strengthen policies to support technology innovation for enterprises.

Making breakthroughs from competitiveness

After nearly two years of implementing the programme on on-going innovation of the growth model, improvement of the quality of growth, labour productivity and competitiveness of the economy under Resolution No. 27 / NQ-CP dated February 21, 2017 of the Government, the economy of Ho Chi Minh City continues to maintain a high and stable growth rate. However, in order to meet the development requirements of the new era, the city should actively remove barriers to sustainable economic development. According to Doctor Huynh The Du, Lecturer of Fulbright University Vietnam, under the SHTP, the result analysis on competitiveness, based on domestic context and comparison with certain cities in the region, show that from the point of view of the economic and commercial centre, Ho Chi Minh City ranked at the top position. However, in order to develop towards a prosperous city with two criteria: competition and a decent living environment, the city needs to exert a lot of effort compared to other cities in Asia.

For the economic growth of Ho Chi Minh City, Prof. Dr. Nguyen Trong Hoai said that the GRDP scale of the city compared to the country has reached a very high threshold and has basically taken maximum advantage of the available inputs and infrastructure. However, technology, the business environment, and infrastructure have not met the metropolitan area of more than 10 million people; regional solutions, spatial expansion and existing spatial restructuring have not been resolutely implemented; and the administrative management mechanism is still complicated therefore productivity is not as good as expected, he added.

Ho Chi Minh City has a very important position and role in the southern key economic region, which is “the nucleus” to create motives for the socio-economic development of localities in the region. In contrast, the provinces in the region are also levers to promote socio-economic growth for the city. Therefore, strengthening the cooperation process in the links is essential to expand the development of the city. Assoc. Prof. Dr. Do Phu Tran Tinh, Faculty of Economics, Ho Chi Minh City University of Economics and Law, commented: "The space for city development is not much and has almost been exploited. The lack of connection among localities, especially in the southern key economic region, is making it difficult to improve the competitiveness and quality of the city's growth in the future. ".

According to Dr. Luong Van Khoi, Deputy Director of for the National Centre for Socio-Economic Information and Forecast, for the main driving force for Ho Chi Minh's economic growth and development in the period from 2018 to 2020 with a vision to 2025 and beyond, it is necessary to continue to focus on three groups of factors: the private sector; institutional reform and business environment; science and technology and improving labour productivity. In addition, in the context of the fourth industrial revolution throughout the world, in order to improve the quality of growth and development of the city's economy, in the short term, Ho Chi Minh City should focus on the socio-economic development policies based on sharing economy and the fourth industrial revolution. Dr. Luong Van Khoi also added that the quality of growth and competitiveness of Ho Chi Minh City depends on the productivity of enterprises and sectors. Therefore, the city should have a strategy and policies to increase productivity for businesses, for the economic sectors of the city in a specific and highly practical manner.

Suggesting the policies of renewing the growth model, Prof. Dr. Nguyen Trong Hoai proposed: "The city should approach the basic steps of the smart urban model, moving from the economic model to focus on inputs into a model of efficiency - innovation - creativity, towards long-term goals with three contents: Technology and infrastructure; people promote creativity and flexible institution, and promoting the business environment by applying technological advances.”.

Ho Chi Minh City should promote its pioneering role of leading the development and cooperation of the region, aiming to become a developed city with two criteria, including high competitiveness and decent living.