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Charting a new path to income convergence

Margaret McMillan's picture

Developing countries made considerable gains during the 2000s, resulting in a large reduction in extreme poverty and a significant expansion of the middle class. More recently that progress has slowed—and the prognosis is for more of the same, given an environment of lackluster global trade, a lack of jobs coupled with skills mismatches, greater income inequality, unprecedented population aging in richer countries, and youth bulges in the poorer ones. As a result, developing countries are unlikely to close the development gap anytime soon.

Three lessons to boost job creation through productive alliances in the food system

Ethel Sennhauser's picture
 
The job creation challenge is intensifying. And the next generation of productive alliances must tap its potential more proactively. What are the best ways to optimize this approach towards boosting employment?
The job creation challenge is intensifying. And the next generation of productive alliances must tap its potential more proactively. What are the best ways to optimize this approach towards boosting employment? (Photo: Chhor Sokunthea / World Bank)


The food system currently employs the majority of people in developing countries, both in self and wage employment. And, according to our recent paper on jobs, all signs indicate that this system — which includes agriculture, as well as beyond-farm jobs in food processing, transportation, restaurants and others — will continue to be a major engine for job creation in the foreseeable future. As economies all over the world are confronted with the challenge of creating around 1.6 billion jobs over the next 15 years, it is important to harness the potential for job generation through productive alliances.

When thinking of forests, don’t forget the value of trees

Werner Kornexl's picture
Forest Landscape


Over the past decade, commitments and support for Forest Landscape Restoration have grown significantly. As part of the Bonn Challenge, for instance, some 40 countries, sub-national jurisdictions, and non-governmental entities have now pledged to restore forest landscapes across 148 million hectares.  Although the environmental benefits in terms of ecosystem services, soil restoration, water, biodiversity and climate resilience are evident, the tremendous economic arguments and the value proposition for poor people living in, or nearby, the forests, are not always at the forefront of the efforts to restore landscapes.
 
In fact, some 1.3 billion people around the world depend on forests for their livelihood—that is 20% of the global population. This includes income from the sale of trees and tree-related products. It also includes the value of fruit, fodder, medicines, and other direct or indirect products that they consume. However, the restoration of forest landscape at a global scale needs a new vision for an integrated forest economy which appreciates and understands forests along their entire value chain. Thus it is crucial to see forest landscape restoration efforts as much more than just protecting forests, but as a force for economic growth and poverty reduction.

Economic marginalization of minorities: Do laws provide the needed protections?

Elaine R.E. Panter's picture

Never in recent history has anti-minorities rhetoric — anti-immigrants, anti-religious-minorities, anti-LGBTI — been so pronounced in so many countries around the world. Those groups, we are told, are the cause of our current economic crisis because they steal our jobs, fuel criminality and threaten our traditional way of living. And yet, the causes of our economic crisis are probably more nuanced, and initial research seems to suggest that more and not less social inclusion will help us overcome the instability of our times.

The exclusion of minorities from the labor force is becoming politically and economically unsustainable for many states that are struggling to retain their legitimacy and strengthen their competitive potential in an increasingly global marketplace. As a consequence, governments, international development agencies and academic institutions are now looking seriously at ways to develop policies that guarantee a more equal and sustainable form of economic development — development that addresses both short- and  long-term economic goals.

The World Bank’s Equality Project attempts to address this problem. The idea driving the project is that institutional measures that hamper the access of ethnic, religious and sexual minorities to the labor market and financial systems (such as legal and policy restrictions, or the absence of appropriate, positive nondiscrimination actions) directly affect their economic performance and, as a consequence, represent a cost for the economy: If a sizeable percentage of the population is not given the opportunity to acquire a high-quality education, a good job, secure housing, access to services, equal representation in decision-making institutions and protection from violence, human capital will be wasted, income inequality will grow and social unrest will ensue. The World Bank’s widely cited Inclusion Matters report puts it succinctly: “Social inclusion matters because exclusion is too costly. These costs are social, economic and political, and are often interrelated.”

The project collected and validated data on the legal framework of six pilot countries: Bulgaria, Mexico, Morocco, the Netherlands, Tanzania and Vietnam. The methodological approach of collecting cross-country comparable data according to key indicators yielded some general but interesting results, published in a research working paper in March 2017.

Các dự án đầu tư đột phá giúp kinh tế Việt Nam phát triển

Kristalina Georgieva's picture

Available in english



Tháng trước tôi có dịp sang công tác tại Việt Nam. Những tiến triển mạnh mẽ tại đây so với 17 năm trước đã gây cho tôi một ấn tượng mạnh.

Năm 2000, kênh Nhiêu Lộc – Thị Nghè chảy qua khu trung tâm Thành Phố Hồ Chí Minh còn ô nhiễm và gây ảnh hưởng xấu lên sức khỏe người dân sống và làm việc trong khu vực. Nhưng hôm nay, dòng kênh đã được cải tạo với dòng nước trong và sạch, mang thêm màu xanh và sức khỏe cho 1,2 triệu người sống tại khu vực này – một khu đô thị đang phát triển nhanh chóng.

Transformative investments shape Vietnam’s economic rise

Kristalina Georgieva's picture
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I was in Vietnam last month and I was so impressed by the tremendous progress the country has made compared to what I had seen 17 years earlier.

In 2000, the Nhieu Loc–Thi Nghe canal in Ho Chi Minh City’s central business district was so polluted that it posed a health risk to everyone living and working there. How times have changed. The canal’s water is now clear, contributing to a greener and healthier urban living for 1.2 million people in the rapidly expanding metropolis.

Working to attract PPPs in countries with the greatest needs

François Bergere's picture



At the Public-Private Infrastructure Advisory Facility (PPIAF) we are always trying to improve how we help countries—especially those with the greatest needs—develop strategies to attract private sector investment in much-needed infrastructure such as transport, water/sanitation, and energy. And we aren’t afraid to assess our past work to find ways to do it.

Urban jungles in jeopardy

Ivo Germann's picture
Why the world’s cities are at risk – and what we can do to make them more resilient



We may not know exactly what the world will look like in two decades, but we know this: it is going to be a world of cities.
 
The global population is becoming increasingly urban, and at an astonishing rate. Each year, urban areas are growing by an average of more than 75 million people – more than the population of the world’s 85 smallest countries combined.
 
For the world’s economy, this is great news, since cities produce 80 percent of global GDP, despite currently being home to only 55 percent of the population. But it is a problem for urban infrastructure, which can’t keep up with such fast-paced growth. As a result, cities, already vulnerable, are becoming increasingly susceptible to natural disasters – from flooding and landslides that can decimate informal housing settlements, to earthquakes that can devastate power grids and water systems.
 
These risks could be disastrous for the urban poor, 881 million of whom currently live in slums (up 28 percent since 2000). And climate change – which is increasing the intensity and frequency of natural disasters – will only exacerbate the problem. For this reason, multilateral and government institutions now see resilience and climate adaptation as integral pillars of development.
 
The Swiss State Secretariat for Economic Affairs (SECO), for example, considers low-emission and climate-resilient economies to be key to global competitiveness. A recent report by the World Bank and the Global Facility for Disaster Reduction and Recovery (GFDRR) found that climate change may force up to 77 million urban residents into poverty by 2030 – unless we take action to improve the resilience of cities around the world.

How do we achieve sustained growth? Through human capital, and East Asia and the Pacific proves it

Michael Crawford's picture
Students at Beijing Bayi High School in China. Photo: World Bank


In 1950, the average working-age person in the world had  almost three years of education, but in East Asia and Pacific (EAP), the  average person had less than half that amount. Around this time, countries in  the EAP  region put themselves on a path that focused on growth  driven by human capital. They made significant and steady investments in  schooling to close the educational attainment gap with the rest of the world. While  improving their school systems, they also put their human capital to work in  labor markets. As a result, economic growth has been stellar: for four decades  EAP has grown at roughly twice the pace of the global average. What is more, no  slowdown is in sight for rising prosperity.

High economic growth and strong human capital accumulation  are deeply intertwined. In a recent paper, Daron Acemoglu and David Autor explore  the way skills and labor markets interact: Human capital is the central  determinant of economic growth and is the main—and very likely the only—means  to achieve shared growth when technology is changing quickly and raising the  demand for skills. Skills promote productivity and growth, but if there are not  enough skilled workers, growth soon chokes off. If, by contrast, skills are abundant and  average skill-levels keep rising, technological change can drive productivity  and growth without stoking inequality.

Education and economic development: Five reforms that have worked

Harry A. Patrinos's picture
Education systems are simply not performing as needed; not as economies demand, and not as parents desire. Yet it’s important to celebrate and recognize the success of countries that have made significant advances. (Photo: Sofie Tesson / Taimani Films / World Bank)

Every sector is reforming to meet the changing demands of the global economy. Except one. Education remains a predominantly public service.  This is fine except that it means that this is also mainly publicly-provided, publicly-financed, and regulated. No public service agency is expected to do as much as we expect of education. How are education systems around the world faring?


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