An apparel factory of the Formostar Garment Vietnam Co., Ltd in Hai Duong province (Photo: VNA) Hanoi (VNA) – Vietnam’s labour productivityis very low compared with growth need, thus raising productivity is the key toeconomic growth, experts said at a conference on April 13.
According to Ngo Van Tuan, deputy director of theParty Central Committee’s Economic Commission, the country’s productivityincreased by an average 4.7 percent a year during 2011-2017, while the GDPgrowth was about 6.21 percent and real wage rose by an average 12.59 percent.
“This means production costs in Vietnam isbecoming more expensive, which directly affects the country’s competitiveness,”Tuan told the CEO forum 2018 held by the Vietnam Economic Times.
The General Statistics Office (GSO) reported thatlocal productivity has been increasing throughout recent year, but remainslower than regional levels.
By purchasing power parity in 2012, Vietnam’sproductivity in 2016 reached 9,894 USD in 2016, equal to only 7 percent ofSingapore’s, 17.6 percent of Malaysia’s and 36.5 percent of Thailand’s.
The gap is still expanding, GSO Director GeneralNguyen Bich Lam said, attributing it to the slow restructuring process of theeconomy, with the high proportion of the workforce working in the agriculturalsector where the labour productivity is low.
[Infographics: VN's labour productivity remains low compared to development demand]
The prevalence of outdated machinery, equipmentand technology in the economy is another cause, he said, noting that mostdomestic firms, particularly private ones, use technology that are two or threegenerations backward compared to the world’s average.
Furthermore, the capacity of resource managementand use is low, as is business administration capacity, according to Lam.
He urged the Government and sectors to make raisinglabour productivity a leading task to improve the national economy’scompetitiveness and sustainable growth.
The Government should set up a national labourproductivity committee to coordinate efforts to enhance productivity, anddevelop a national strategy to help the country catch up with regionalcountries in terms of productivity.
Deputy director of the Party Central Committee’sEconomic Commission Tran Van Tuan was of the opinion that the most effectivesolution to enhance productivity is to attract FDI into industrial production andservices of higher value.
He said the country needs a new strategy and newdirections in attracting FDI, in order to allow the FDI sector to play agreater role in technology transfer.
A representative from Deloitte Vietnam Ha ThuThanh said as the human factor is the first to affect labour productivity, thecountry needs a human-based approach to productivity enhancement.-VNA
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