Remarks by Mr. Bakhodir Burkhanov, UNDP Deputy Country Director at the round-table on emerging trends of economic integration in Asia-Pacific and implications for Viet Nam
Speaker: Mr. Bakhodir Burkhanov, UNDP Deputy Country Director
Date: 23 November 2012
Event: Round-table on emerging trends of economic integration in Asia-Pacific and implications for Viet Nam
Excellency Mr. Bui Thanh Son, Vice Minister of Foreign Affairs
Excellency Mr. Vu Khoan, Former Deputy Prime Minister
Mme Ambassador Nguyen Nguyet Nga, Director General for Multilateral Economic Cooperation
Distinguished panelists and round-table participants:
Let me start by thanking the Ministry of Foreign Affairs for the opportunity to address this important event. It is UNDP’s privilege to attend today’s meeting. We have been supporting the Ministry of Foreign Affairs since 2006 to strengthen its capacity for economic diplomacy. Soon we will be launching a new partnership on national capacity enhancement for international economic integration. This new project will support the Government in developing key national policies and strategies on international economic integration through evidence-based research and international and south-south collaboration.
As the UN Development Programme, our role is to bring the human development perspectives to the debate about economic growth and international integration, and to provide relevant regional and global perspectives.
Projections of the world’s top 10 economies in 2050 see China as the largest economy, overtaking the U.S. before 2027; Indonesia rising to the 9th largest economy; and India becoming the third largest economy, nearly catching up with the U.S. by mid-century. However, per capita income of Asia’s emerging economies will still be much lower than that of the developed countries of the OECD club.
Though the Asia’s biggest development success is its poverty reduction record, the agenda is not finished: poor people are increasingly found in Middle-Income Countries. In fact, of the 1 billion poor people in the world, more than 70% live in Middle-Income Countries.
To add to this complexity, increasing inequalities and disparities between population sub-groups pose a growing threat to economic and social stability within countries and in the region.
Emerging economies in Asia, including Viet Nam are looking for ways to “restructure” their economies, to move up in the value chain and at the same time ensure that the growth is inclusive and equitable, that it is sustainable and resilient to economic and climate change shocks.
For the past two decades economic integration has been an important contributor of economic development in many Asian countries, including Viet Nam. Viet Nam has been actively involved in several economic integration processes including unilateral liberalisation of trade and investment regimes, implementation of WTO obligations, negotiation and implementation of ASEAN commitments including the ASEAN Free Trade Agreement (AFTA) as well as various bilateral initiatives.
These efforts paid off as the country’s economy grew exponentially in the last twenty years. From 1990 to 2011, Viet Nam’s Human DeveIopment Index value has increased by an impressive 37 percent. Viet Nam’s progress over time in the Human Development dimensions – namely life expectancy, schooling and incomes – showed most improvement in per capita incomes. Economic growth has deservedly been the single most important driver of human development in Viet Nam.
While growth oriented policies have been successful so far, policy-makers across Asia and in Viet Nam must continue to ensure that growth remains robust and brings equal benefits to the poor, generates jobs for the youth and in informal sectors, and translates into progress in social development. In the case of Viet Nam, the progress in health and education has been less rapid, while other countries in the region have invested more heavily in educated and skilled workforce to maintain the momentum of economic growth and to re-orient their economies at the time of global crises.
The current economic slowdown has hit Asia's traditional export markets. We see re-emergence of protectionist policies in some countries. Countries in Asia need to increasingly rely on domestic and regional demand. In fact, Asia-Pacific has recently emerged as the main source of final demand for the region’s exports, with sizable middle class to absorb a growing range of products and services. Boosting purchasing power of the poorer population is emerging as a key priority for many Middle-Income Countries. It calls for broad-based investments in education, health services, social protection and basic infrastructure, which will facilitate access to employment and business opportunities for all social groups.
International economic integration has been a successful strategy, which could deliver even more dividend if paired with smart investment decisions benefiting the social sector in order to achieve the full potential of human development.
The United Nations believes firmly that the MDG 8 target of “open, rule-based, fair trading and financial systems” can make a great contribution to global development. The removal of barriers to trade and investment and more transparent economic regulations are key to this vision. These measures hold greater potential still if countries pursue inclusive and equitable growth models. UNDP stands ready to provide further advice and expertise towards sustainable growth and economic integration initiatives.
I once again thank the Ministry of Foreign Affairs for convening this important round table, and wish all participants a successful and productive meeting.