Overview

Since 1998 Viet Nam has been engaged in a process of "renovation" and reform intended to facilitate its transition towards a socialist market economy the goal of which is to marry rapid economic growth with equitable social development. In this process the Government of Viet Nam has paid conscious attention to both the economic and the social needs of its population. Its current development strategy is based on four pillars, namely: sustainable economic growth; political, social and economic stability; equity; and people-centered development. That this explicit linking of the economic with the social has contributed, in great measure, to the high degree of progress made in the social arena to date is best exemplified by the rising standards of living and the concomitant fall in poverty in the country over the decade since the institution of its policies of renovation and reform. Nonetheless, while the progress achieved over the past decade has been impressive, Viet Nam remains a very poor country with a per capita GDP of around $370 and an estimated 30 million people (or around 37 percent of the population) living in poverty. Recent World Bank figures also suggest that around 25 million people, accounting for about 60 percent of the labour force, are unemployed or underemployed and that there will continue to be over one million new entrants to the labour force each year, making employment creation one of the major concerns of the Vietnamese Government in the next decade. Poverty alleviation, and the creation of adequate social safety nets also continue to be major preoccupations of the Government.

In April 2001 the IX National Congress of the Viet Nam Communist Party unveiled its new Socio-Economic Development Strategy for 2001 - 2010. The Strategy envisages continued progress towards a socialist market economy, which is fully integrated into the global economy and competitive internationally; and which is characterized by: rapid and sustainable economic growth; a modern, industrialized and knowledge-based economy; and a just and stable society with a high quality of life for all its people. Specific targets include: a doubling of GDP by 2010, to be attained through annual economic growth of over seven percent; a decline in the share of agriculture in GDP from its current level of 25 percent to 16 - 17 percent and corresponding increases in the shares of industry (from 35 to 40 - 41 percent) and services (from 40 to 42 - 43 percent); a decline in the share of rural employment from two-thirds to half of all employment. Importantly, explicit attention is paid to the quality of growth and Viet Nam’s goal is to share the fruits of growth broadly across all segments of the population so as to avoid inequities, social exclusion and environmental degradation.

The Socio-Economic Strategy is to be implemented through two five-year Socio-Economic Development Plans and the goals of the first Plan (2001 - 2005) include: vigorous economic and labour restructuring geared towards industrialization and modernization; improving the efficiency and competitiveness of the economy; developing a multi-sector economy based on all forms of ownership (in which the State sector continues to play a key role but which also acknowledges the growing importance of the private sector, including the micro-enterprise and household sectors); expanding foreign economic relations; improving education and training; multiplying job opportunities; eradicating hunger and reducing the number of poor households. State economic management remains central to the process of transition to a market economy and is to be strengthened and made more efficient. Special attention is to be paid to the development of  markets, including the labour market. Specifically, the Plan is expected to expand the domestic labour market under State monitoring and supervision, protect the interests of both employers and workers; encourage and facilitate the overseas migration of workers; complete the design of a legal and policy system which would create equal job opportunities for working people; and provide enabling and conducive conditions for self-employment, skills improvement, training and retraining.

In July 2000, the United States of America and Viet Nam signed a bilateral trade agreement (BTA) which is intended to extend conditional normal trade relations to Viet Nam, significantly lowering tariffs on imports from Viet Nam in return for the latter’s agreement to enact a wide-range of market-oriented reforms. While the BTA itself does not specifically address workers’ rights, the on-going Congressional debate on the BTA is expected to highlight labour issues in Viet Nam.

ILO Constituents

The Ministry of Labour, Invalids and Social Affairs (MoLISA) is the main focal point for the ILO in Viet Nam. In addition to the activities carried out under a wide range of projects, direct ILO assistance and advisory services have been sought on public sector pay reform, the drafting of the new social security act which went before the National Assembly in June this year, and the review of the two forced labour Conventions (C29 and C105) with a view to their eventual ratification.

Ms. NGUYEN Thi Hang is the Minister of Labour, Invalids and Social Affairs.

Employers

There are two recognized organizations representing employers at the national level: the Viet Nam Cooperative Alliance (VCA) whose membership base includes the micro- and household enterprise sector and cooperatives; and the Viet Nam Chamber of Commerce and Industry (VCCI) which, by and large, covers the formal private sector, including the foreign invested firms, but which also numbers some state owned enterprises among its membership. More recently the VCCI has been turning its attention to the micro-enterprise sector and is also increasingly active in the policy dialogue between the Government and the private sector with a view to improving the enabling environment for private sector development. The ILO’s SEED programme is assisting in this process through technical cooperation and research intended to support the VCCI’s participation in the policy debate. It also fosters public private partnerships at the communal level.

With the establishment in 1997 of a Bureau for Employers’ Activities (BEA), a number of capacity-building activities for it, and for its membership, are being undertaken by the ILO’s Bureau for Employers’ Activities (ACT/EMP) and EASMAT. The ILO’s Start and Improve Your Business Project is based in the VCCI/BEA and the VCCI/BEA has responsibility for the labour-management relations component of the SAVPOT project.

The Director of the VCCI’s Bureau for Employers’ Activities is Mr. Phung Quang Huy. Mr. Nguyen Ty is the President of the VCA.

The Viet Nam General Confederation of Labour (VGCL) is one of the five mass organizations affiliated to the Communist Party and represents the working population of Viet Nam. Internationally it is affiliated to the WFTU.

The VGCL comprises an umbrella organization under which all local level and sectoral unions operate. Although the Labour Code requires that a trade union be established in all enterprises with ten or more employees, and be affiliated with the VGCL, recent information indicates that compliance with this requirement is relatively low in the emerging private sector where only around 30 per cent of the eligible two million workers are unionized. However, the VGCL is a powerful actor in the national policy making arena and at the provincial level. With the transition to a market economy and the emergence of a private sector, the strengthening of trade union capacity to engage in dialogue and action on a wide spectrum of labour issues has become critical and the ILO is providing assistance in such areas as collective bargaining, employment services and occupational safety and health, working women and child labour. The VGCL participates in the SAVPOT project and was one of the national trade unions involved in the regional project on Strengthening Trade Union Support for the Informal Sector which has just concluded. Assistance is also provided to the National Institute for Labour Protection in the area of occupational health and safety.

Ms. Cu Thi Hau is the President of the VCGL.

International Labour Standards

Viet Nam has ratified 15 Conventions to date, three of which are among the Core Conventions (C100, C111 and C182). Three further core Conventions (C138, C29 and C105) are currently under active review and there are indications that C138 could be ratified this year.

Technical Cooperation

The ILO is currently implementing seven national projects in Viet Nam and one further project was successfully concluded in December 2000. In addition, Viet Nam participates in eight international, regional or sub-regional projects. Three new projects have just been approved and are expected to start up shortly. Areas of assistance include: child labour, women workers, trafficking in women and children, labour administration, labour inspection, social security, occupational safety and health, public sector wage reform, social dialogue and small and micro enterprise development.