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"Lara J. Iverson-Hamill" <larajiuk@yahoo.co.uk>
date Mar 1, 2007 6:42 PM
subject [Vsg] Vietnam has second thoughts about WTO
Published in Asia Times Online today:
Vietnam has second thoughts about WTO
By Shawn W Crispin
Bill Hayton <bill.hayton@bbc.co.uk>
date Mar 1, 2007 7:37 PM
subject RE: [Vsg] Vietnam has second thoughts about WTO
It's a very good article except for the title and the opening paragraph.
The idea that the leadership is thinking of going back on WTO
commitments isn't credible. There may be some, like Margaret Thatcher
after she agreed to the Single European Act, who are only now realising
what they've done - but any idea of a pull-out from the WTO or failing
to live up to commitments is wide of the mark, in my view.
Bill Hayton
"Adam @ UoM" <fforde@unimelb.edu.au>
date Mar 2, 2007 1:55 AM
subject RE: [Vsg] Vietnam has second thoughts about WTO
I would like to know the basis for the view that the Vietnamese government
will not fail to live up to their commitments. It would seem to me that
there are very plausible arguments that they both lack the authority over
their own apparatus, and the basic political economy premises, even if they
had, to do so. Look at the realities of the SOE equitisation drive, to start
with. A lot of what is in the article suggests an element of planning behind
all this, which makes sense.
Adam
Bill Hayton <bill.hayton@bbc.co.uk>
date Mar 3, 2007 6:01 PM
subject RE: [Vsg] Vietnam has second thoughts about WTO
I'm going to stick my neck out on this one...
The Asia Times article below is almost entirely about how the State Bank and the State
Securities Commission are trying to manage the markets. According to several international
bankers in Hanoi and HCMC, to whom I have spoken, the SBV and the Ministry of Finance are
becoming increasingly sophisticated in the way they try to control the stock markets (I'm not
talking about the over-the-counter market here). Despite a lack of secondary legislation they
are learning how to deliver messages and have been using the banks as messengers - at a
conference in Hanoi in January several big investors were lined up by the SBV to say the
market was 30% over-valued and ANZ were also used to speak to the press more recently about
the possibility of capital controls. So yes, there is certainly an element of planning in the
way parts of the government are attempting to control the financial markets.
But on the wider question of whether the government will live up to its WTO commitments the
article below says almost nothing (despite the title). The question of capital controls has
nothing to do with the WTO - Thailand, a WTO member, has them for example. There's one
sentence - "Amid the internal debate on capital controls, a reportedly reactionary camp of
party cadres has asserted its view that the government should ease the pace of reform now
that it has safely secured WTO membership." But all that says is that some people disagree
with the direction of policy. No surprise there.
I am increasingly of the view (and this is where I'm sticking my neck out) that there has
been a significant shift in the way the leadership thinks about the economy. I think that it
has decided to be a 'Gaullist' economy - with a nationally-directed but profit-making (if
possible) state sector active in strategic areas - but with a mix of state, private, foreign
and domestic companies and with an increasingly level playing field between them. From my
conversations with the few state/party officials who will talk to foreign journalists I think
the leadership is serious about living up to its WTO commitments, that it recognises that to
provide the required million jobs news a year for the next decade at least it needs foreign
investors and free enterprise. The recent Central Committee decision to strip the military of
most of its business interests was, I believe, in part dictated by WTO provisions on
transparency and removing hidden subsidies.
I'm not arguing that everyone in positions of authority, particularly those in the state-
owned sector, agrees with this policy or that it will be a simple linear path to a more open
economy. But I do believe that the majority of the current Party-State leadership are set on
this direction.
Now you can tell me that I'm a naïve fool...
"Adam @ UoM" <fforde@unimelb.edu.au>
date Mar 3, 2007 6:47 PM
subject [Vsg] The emerging Vietnamese 'developmental state'?
"A 'Gaullist' economy - with a nationally-directed but profit-making (if
possible) state sector active in strategic areas - but with a mix of state,
private, foreign and domestic companies and with an increasingly level
playing field between them."
Good on you! I agree - see Fforde 2007 (the book) and my earlier working
paper up at the SEARC site on SOE real ownership. Blah blah. The idea of a
level playing field, though, is both somewhat murky and not really needed;
it assumes a level of cunning and clarity that may not be quite enough to
support PhD theses about the emerging Vietnamese developmental state. Though
you never know. Wait and see.
As we may about to be reminded, many histories suggest that the French post
WWII Economic Miracle (including the 1950s, for those who have seen M
Hulot's Holiday) was largely based upon the state sector, and especially
state commercial banks. So it was not Gaullist, but Schumanesque (?
spelling). The French had no equivalent to the German transition from
Erhardt creative capitalist chaos to post-68 regulated sclerosis.
This is of course largely (still?) anathema to mainstream development
doctrine, especially Anglo-Saxon - though the more intense the condemnation
usually the more out of date the economics degree of the economist you are
talking to is ... but that is another matter. There are so many ways to skin
a cat that the data suggests that there are no robustly correct policies,
which is another piece of heresy.
Cheers
Adam
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