NN38, February 2007
Technical and Vocational Skills Development
SKILLS DEVELOPMENT AND THE WTO IN VIETNAM: WHAT?S NEXT?
By Alexandre Dormeier Freire, IUED, Geneva (currently in Vietnam)
KeywordsVietNam, Skills development, WTO
Summary
This article summarizes the findings of a recent study that examines skills development in Vietnam and briefly discusses the current strategy issues and recent government initiatives in the context of the country?s membership of the WTO in January 2007.
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After 11 years of negotiations, Vietnam succeeded in its attempt to join the World Trade Organization (WTO). Vietnam has ratified its membership agreement and became the WTO?s 150th member in January 2007. In a recent publication based on research done by Alexandre Dormeier Freire and Vu Bich Thuy funded by the Swiss Development Cooperation Agency, the two authors have demonstrated that the situation of skills development (SD) in Vietnam remains unclear and uncertain (Freire and Thuy, 2006). How will the government adapt the skills development strategies to the new WTO context? What are the current trends in skills development in one of the fastest growing economies in the world? This article discusses the current strategic issues and recent government initiatives.
In a nutshell, there are several gaps regarding the skills development policies and strategies and the economic challenges in Vietnam today. First, it seems that skills strategies are not clearly located at the national and provincial development goals. As a consequence, Vietnam?s abundant workforce remains largely unskilled (83% of the total workforce of 40 million people) and the lack of prioritization of SD at both central and provincial level is a problem. Second, some actors such as business associations and entrepreneurship associations are left outside of the design and conception of both policies and strategies. Third, SD strategies engender tensions between a social approach to SD and a more ?technical? vision. Some actors do strongly believe that SD strategies have to be linked to market and labour questions whereas others consider them as being only limited to social issues (such as working with women, maternal heath training, etc.). Fourth, SD is still more supply-driven than demand driven. Many reasons could be found to explain this: two among these would be the remaining vestiges of central planning practices and the labour market segmentation across regions, gender, industries, etc. Many papers have pointed to this segmentation (e.g. ADB, 2006).
In which direction is the government heading in order to tackle the WTO access? There?s no doubt that the WTO access will provoke a profound change in the country?s economic structure. At a recent international conference (see references below) on Viet Nam, held at IUED last December, CIEM (Central Institute for Economic Management, Hanoi) experts pointed out that some of the major challenges would be: to conduct institutional reforms and broader integration, to secure FDI (including in service sectors) and to adapt its human resource development by some fundamental changes in the education and training system. The country has already started some profound reforms and a new education bill is under discussion. Meanwhile, the authorities have agreed to privatize parts of the education and training sector. According to the Ministry of Education and Training, the goal is to raise the enrolment rate of universities and colleges from 250,000 students at present to 420,000 by 2010, and to 1.2 million by 2020. However, the government has said that, within these totals, it would gradually reduce the proportion of university students from 78.4% at present to 56% by 2020 while raising the ratio of college students from 21.6% to 44%, respectively (Vietnam News Brief Service, 18 July 2006). At the same time, more technical secondary schools and technical training programmes would be implemented. Therefore, in July the Ministry of Labour and Social Affairs has announced that it would grant licenses to individuals and organizations to run vocational schools provided certain criteria and standards are met. Vietnam counts now nearly 1,600 public vocational training centres and schools attended by 1.1 million people annually.
If privatization appears to be one of the main answers to the WTO challenges for skills development, questions immediately arise concerning accreditation, quality, access, institutional procedures for skills? policies and for provincial inequalities. In a country where education is already highly competitive and where 37% of university and colleges graduates remain unemployed, not only have SD strategies and policies to be adjusted to include raising awareness questions but also the design process of SD strategies has to be reconsidered to better reflect the changes of the modern economy. The continual shortage of technical workers and technicians will remain a problem in any industrial and economic shift that the country is hoping to make with the WTO access. The danger for the country is that the current gaps between the SD strategies and policies and the needs of a modern economy and labor market briefly described in this paper will expand.
References
ADB (2006) Labour Market Segmentation and Poverty, Briefing Note No12.
Economic Internationalisation, Human Development and State-society Relations in Asia: Learning from Vietnam, Conference, IUED, UNCTAD, University of Geneva, ITC, Geneva, 14-16 December 2006.
Education: Vietnam Allows Organizations, Individuals to Run Vocational Schools, Vietnam News Brief Service, 18 July 2006.
Freire, A., D. and Thuy, V., B. (2006) How Do National and International Actors Interact in Skills Development Strategies? The Analysis of Vietnam under Doi Moi (1986-2004), Coll. Etudes Courtes No. 9, IUED : Genève.
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