Journal Articles & Occasional Papers
Electricity Demand and Supply in Myanmar
David Dapice, December 2012
The Asian Development Bank (ADB) recently released an excellent report on Myanmar’s energy sector. In it they presented estimates of future demand growth by the Ministry of Electric Power for electricity. They show demand doubling from 12,459 million kWh in 2012-13 to 25,683 million kWh in 2018-19, a compound rate of growth of 13% a year. However, the actual production in 2012 appears to be only 10,000 million kWh, and it is unlikely that moving to 2012-13 will raise the total much beyond 10,500 million kWh. Of this output, about 1700 million kWh will be exported. (Electricity exports exceeded 1700 million kWh in both 2010 and 2011.) So, the likely electricity output in 2012-13 available for domestic use will be 3659 kWh below this year’s demand estimate. Production for domestic use would have to jump by 42% to equal the expected demand. This is a massive shortfall and demand grows by over 1500 million kWh in 2013-14. So for 2013-14, supply net of exports would have to grow by nearly 5200 million kWh to account for the existing shortfall and projected growth, or by nearly 60% over 2012-13. More»
David Dapice, December 2012
The Asian Development Bank (ADB) recently released an excellent report on Myanmar’s energy sector. In it they presented estimates of future demand growth by the Ministry of Electric Power for electricity. They show demand doubling from 12,459 million kWh in 2012-13 to 25,683 million kWh in 2018-19, a compound rate of growth of 13% a year. However, the actual production in 2012 appears to be only 10,000 million kWh, and it is unlikely that moving to 2012-13 will raise the total much beyond 10,500 million kWh. Of this output, about 1700 million kWh will be exported. (Electricity exports exceeded 1700 million kWh in both 2010 and 2011.) So, the likely electricity output in 2012-13 available for domestic use will be 3659 kWh below this year’s demand estimate. Production for domestic use would have to jump by 42% to equal the expected demand. This is a massive shortfall and demand grows by over 1500 million kWh in 2013-14. So for 2013-14, supply net of exports would have to grow by nearly 5200 million kWh to account for the existing shortfall and projected growth, or by nearly 60% over 2012-13. More»
China and Yunnan Economic Relations with Myanmar and the Kachin State: Powering the Peace Process
David Dapice, September 2012
Myanmar, long isolated from western economies due to its government, is one of the poorest and worst governed countries in the world.1 Ruled for many years by a reclusive dictator, senior general Than Shwe, it was dependent on China for diplomatic protection and arms. Trade and investment deals reflected its lack of alternatives. China’s “One nation, two oceans” policy and Yunnan’s “Bridgehead” strategy envisioned Myanmar providing access to the sea via gas and oil pipelines, deep sea ports, naval docking facilities and transport for Yunnan. Yunnan through its Southern Grid along with CPI (China Power International) saw Myanmar’s Kachin state as providing ample hydroelectric supplies for the landlocked Chinese province. Deals were signed under General Than Shwe without popular review or consultation with the Kachin whose state had most of the hydroelectric sites. More»
David Dapice, September 2012
Myanmar, long isolated from western economies due to its government, is one of the poorest and worst governed countries in the world.1 Ruled for many years by a reclusive dictator, senior general Than Shwe, it was dependent on China for diplomatic protection and arms. Trade and investment deals reflected its lack of alternatives. China’s “One nation, two oceans” policy and Yunnan’s “Bridgehead” strategy envisioned Myanmar providing access to the sea via gas and oil pipelines, deep sea ports, naval docking facilities and transport for Yunnan. Yunnan through its Southern Grid along with CPI (China Power International) saw Myanmar’s Kachin state as providing ample hydroelectric supplies for the landlocked Chinese province. Deals were signed under General Than Shwe without popular review or consultation with the Kachin whose state had most of the hydroelectric sites. More»
Myanmar: Negotiating Nation Building, A Path to Unity and Progress
David Dapice, May 2012
There is an immense challenge facing the leadership in Myanmar. They have to negotiate a nation and to reform the basic assumptions and processes that have ruled for the past decades. They need to make the new system more representative, more inclusive, less favorable to a narrow group of businessmen and government or army officials, and more broadly successful. The new system has to give minority groups a reason to want to be part of the new nation. That means not only creating new sources of growth and wealth, but also making rules that ensure the benefits go to many more than the relatively narrow groups who have largely benefitted in the past. The technical adjustments needed in the exchange rate, the financial system, taxing and spending, infrastructure investments, and competition policy will all ultimately be judged on the ability of the policy package to create the conditions for national unity and progress. The government needs to have a vision of this goal and how the pieces fit together. Getting it to work in a shaky world economy with new and still evolving institutions is a huge challenge. But for those who have seen the past clearly for what it was, there can be no doubt that moving forward together is better than going back or staying put. More»
David Dapice, May 2012
There is an immense challenge facing the leadership in Myanmar. They have to negotiate a nation and to reform the basic assumptions and processes that have ruled for the past decades. They need to make the new system more representative, more inclusive, less favorable to a narrow group of businessmen and government or army officials, and more broadly successful. The new system has to give minority groups a reason to want to be part of the new nation. That means not only creating new sources of growth and wealth, but also making rules that ensure the benefits go to many more than the relatively narrow groups who have largely benefitted in the past. The technical adjustments needed in the exchange rate, the financial system, taxing and spending, infrastructure investments, and competition policy will all ultimately be judged on the ability of the policy package to create the conditions for national unity and progress. The government needs to have a vision of this goal and how the pieces fit together. Getting it to work in a shaky world economy with new and still evolving institutions is a huge challenge. But for those who have seen the past clearly for what it was, there can be no doubt that moving forward together is better than going back or staying put. More»
Electricity in Myanmar: The Missing Prerequisite for Development
David Dapice, May 2012
Electricity is a fundamental input to every modern economy. Electricity consumption per capita in Myanmar is among the lowest in Asia and had been growing very slowly since the 1980’s. It gently grew from 45 kWh per capita in 1987 to 99 kWh in 2008, a 3.8 percent annual growth rate.1 However, since 2008, the production of electricity has jumped very quickly. This 50 percent jump in three years is about 15 percent per year, far higher than in the past. The CSO does not report any increase in installed capacity since 2009/10, so the existing system is being worked much more intensively. This creates problems, such as the risk of sudden outages from failures in generators. Indeed, there has been an increase in blackouts in the Yangon and Mandalay areas in the last year in spite of higher output – and even during the wet season. With increases in tourism, exports and overall economic activity, electricity demand will continue to soar. Even with 2011/12 output, estimated consumption in Myanmar is only about 160 kWh per capita, compared to 2009 consumption of over 250 kWh per capita in Bangladesh and nearly 600 in Indonesia. Vietnam had over 1000 kWh per capita in 2011. More»
David Dapice, May 2012
Electricity is a fundamental input to every modern economy. Electricity consumption per capita in Myanmar is among the lowest in Asia and had been growing very slowly since the 1980’s. It gently grew from 45 kWh per capita in 1987 to 99 kWh in 2008, a 3.8 percent annual growth rate.1 However, since 2008, the production of electricity has jumped very quickly. This 50 percent jump in three years is about 15 percent per year, far higher than in the past. The CSO does not report any increase in installed capacity since 2009/10, so the existing system is being worked much more intensively. This creates problems, such as the risk of sudden outages from failures in generators. Indeed, there has been an increase in blackouts in the Yangon and Mandalay areas in the last year in spite of higher output – and even during the wet season. With increases in tourism, exports and overall economic activity, electricity demand will continue to soar. Even with 2011/12 output, estimated consumption in Myanmar is only about 160 kWh per capita, compared to 2009 consumption of over 250 kWh per capita in Bangladesh and nearly 600 in Indonesia. Vietnam had over 1000 kWh per capita in 2011. More»
Industrial Policy Reform in Myanmar
Dwight H. Perkins, April 2012
Myanmar faces fundamental choices about its economic future when the sanctions are lifted, and many of these choices will be present even if some of the sanctions remain. There is no technical reason why Myanmar cannot achieve a GDP growth rate of 8 percent a year or more for several decades. If the country did achieve a growth rate of that magnitude, the standard of living of its people would double over the next decade and increase four-fold over the next two decades. Poverty would fall dramatically, first in the more developed regions and then nationwide. In the most recent two decades, in contrast, Myanmar’s electric power consumption suggests that GDP growth per capita has at best been negligible and may even have been negative.
More»
Dwight H. Perkins, April 2012
Myanmar faces fundamental choices about its economic future when the sanctions are lifted, and many of these choices will be present even if some of the sanctions remain. There is no technical reason why Myanmar cannot achieve a GDP growth rate of 8 percent a year or more for several decades. If the country did achieve a growth rate of that magnitude, the standard of living of its people would double over the next decade and increase four-fold over the next two decades. Poverty would fall dramatically, first in the more developed regions and then nationwide. In the most recent two decades, in contrast, Myanmar’s electric power consumption suggests that GDP growth per capita has at best been negligible and may even have been negative.
More»
Yangon's Development Challenges
José A. Gómez-Ibáñez and Nguyễn Xuân Thành, March 2012
Yangon is an attractive and relatively livable city that is on the brink of dramatic change. If the government of Myanmar continues its recent program of economic and political reform, the economy of the country is likely to take off, and much of the growth will be concentrated in Yangon, Myanmar’s largest city and commercial capital. This paper argues that Yangon is poorly prepared to cope with the pressures of growth because it has only begun to develop a comprehensive land use and development plan for the city that would guide the location of key activities including export-oriented industries and port terminals. In addition, the city lacks the financial resources to finance the infrastructure and other public services required to serve the existing population, let alone support a population that is larger and better off. Failure to address these challenges will not only make Yangon a less livable city but will also reduce the rate of economic growth for the entire country. Myanmar needs a dynamic and vibrant Yangon to thrive. More»
José A. Gómez-Ibáñez and Nguyễn Xuân Thành, March 2012
Yangon is an attractive and relatively livable city that is on the brink of dramatic change. If the government of Myanmar continues its recent program of economic and political reform, the economy of the country is likely to take off, and much of the growth will be concentrated in Yangon, Myanmar’s largest city and commercial capital. This paper argues that Yangon is poorly prepared to cope with the pressures of growth because it has only begun to develop a comprehensive land use and development plan for the city that would guide the location of key activities including export-oriented industries and port terminals. In addition, the city lacks the financial resources to finance the infrastructure and other public services required to serve the existing population, let alone support a population that is larger and better off. Failure to address these challenges will not only make Yangon a less livable city but will also reduce the rate of economic growth for the entire country. Myanmar needs a dynamic and vibrant Yangon to thrive. More»
The Exchange Rate in Myanmar: An Update to January 2012
David Dapice, January 2012
The exchange rate has moved from about 1300 kyat per dollar in 2006-07 to 800 kyat to the dollar in January 2012 while the consumer price index has jumped by over two-thirds. World rice prices in dollars have been generally strong, with Vietnamese five percent broken export prices at $520/ton in December 2011, 78 percent above their 2006/07 average. Wholesale paddy prices in Myanmar have plunged 30 percent in real terms from 2007 to 2012 and 25 percent in just the last year. For a variety of reasons, the paddy price to farmers may have fallen even more. This results in less hiring of landless neighbors, migration out of the village (often to a foreign country), less use of inputs and reduced summer paddy planting. Sharp real price declines in pulses have also been reported, though the exchange rate is only one contributing factor to their low prices. Poor quality pulses due to untimely rains and reduced demand from India also play some role. More»
David Dapice, January 2012
The exchange rate has moved from about 1300 kyat per dollar in 2006-07 to 800 kyat to the dollar in January 2012 while the consumer price index has jumped by over two-thirds. World rice prices in dollars have been generally strong, with Vietnamese five percent broken export prices at $520/ton in December 2011, 78 percent above their 2006/07 average. Wholesale paddy prices in Myanmar have plunged 30 percent in real terms from 2007 to 2012 and 25 percent in just the last year. For a variety of reasons, the paddy price to farmers may have fallen even more. This results in less hiring of landless neighbors, migration out of the village (often to a foreign country), less use of inputs and reduced summer paddy planting. Sharp real price declines in pulses have also been reported, though the exchange rate is only one contributing factor to their low prices. Poor quality pulses due to untimely rains and reduced demand from India also play some role. More»
Appraising the Post-Sanctions Prospects for Myanmar's Economy: Choosing the Right Path
David O. Dapice, Michael J. Montesano, Anthony J. Saich, Thomas J. Vallely, January 2012
This paper is the first iteration in an ongoing effort by the Ash Center and Proximity Designs to describe a growth strategy for Myanmar that takes account of political and economic realities – assuming that sanctions will soon be removed. Myanmar is a country facing a difficult political and economic transition. In spite of the implications of official statistics and recent surveys, it is a very poor country, long mired in conflict and cut off from much of the world. It has an immense struggle ahead, as it tries to create a more modern and capable state apparatus, a competitive private sector and economy, and an economic and political system that reflects popular sentiments. It is not just behind its neighbors – it is starting from a different place altogether. More»
David O. Dapice, Michael J. Montesano, Anthony J. Saich, Thomas J. Vallely, January 2012
This paper is the first iteration in an ongoing effort by the Ash Center and Proximity Designs to describe a growth strategy for Myanmar that takes account of political and economic realities – assuming that sanctions will soon be removed. Myanmar is a country facing a difficult political and economic transition. In spite of the implications of official statistics and recent surveys, it is a very poor country, long mired in conflict and cut off from much of the world. It has an immense struggle ahead, as it tries to create a more modern and capable state apparatus, a competitive private sector and economy, and an economic and political system that reflects popular sentiments. It is not just behind its neighbors – it is starting from a different place altogether. More»
Structural Reform for Growth, Equity, and National Sovereignty
Jonathan Pincus, Vu Thanh Tu Anh, Pham Duy Nghia, Ben Wilkinson, and Nguyen Xuan Thanh, January 2012
This paper has been prepared for the third annual Vietnam Executive Leadership Program (VELP), to be held at Harvard Kennedy School from February 12 to 17, 2012. The goal of this paper is to provide participants in the VELP forum, including Vietnamese government officials, international scholars, and corporate executives, with an assessment of some of the key public policy challenges confronting Vietnam today. This paper is by no means comprehensive; by necessity, it has not been possible to undertake an exhaustive study of every policy area. In selecting which issues to address, the authors have been guided by the priorities of the Vietnamese government as they have been articulated in policy statements promulgated over the past year. More»
Jonathan Pincus, Vu Thanh Tu Anh, Pham Duy Nghia, Ben Wilkinson, and Nguyen Xuan Thanh, January 2012
This paper has been prepared for the third annual Vietnam Executive Leadership Program (VELP), to be held at Harvard Kennedy School from February 12 to 17, 2012. The goal of this paper is to provide participants in the VELP forum, including Vietnamese government officials, international scholars, and corporate executives, with an assessment of some of the key public policy challenges confronting Vietnam today. This paper is by no means comprehensive; by necessity, it has not been possible to undertake an exhaustive study of every policy area. In selecting which issues to address, the authors have been guided by the priorities of the Vietnamese government as they have been articulated in policy statements promulgated over the past year. More»
Squaring the Circle: Politics and Energy Supply in Indonesia
By David Dapice and Edward A. Cunningham, December 2011
Ensuring affordable, stable, and accessible energy supply remains one of the most critical functions of government, particularly in the developing world. The creation and expansion of a national energy system presents governments with inherent risks that must be managed if an economy is to be supplied with the energy it requires to grow. Some risks are structural, and inherent to the sector itself. Energy systems are characterized by high levels of capital intensity (e.g. oil refining), long-cycle investments with extended pay-back periods (e.g. oil exploration and production), natural monopolies (e.g. electric grid and gas transmission), and high levels of risk that result from the combination of these attributes. Energy flows may also carry the added complexity of perceived national security externalities, such as supply risk in the form of oil import dependency on one partner. More»
By David Dapice and Edward A. Cunningham, December 2011
Ensuring affordable, stable, and accessible energy supply remains one of the most critical functions of government, particularly in the developing world. The creation and expansion of a national energy system presents governments with inherent risks that must be managed if an economy is to be supplied with the energy it requires to grow. Some risks are structural, and inherent to the sector itself. Energy systems are characterized by high levels of capital intensity (e.g. oil refining), long-cycle investments with extended pay-back periods (e.g. oil exploration and production), natural monopolies (e.g. electric grid and gas transmission), and high levels of risk that result from the combination of these attributes. Energy flows may also carry the added complexity of perceived national security externalities, such as supply risk in the form of oil import dependency on one partner. More»
Myanmar Agriculture in 2011: Old Problems and New Challenges
David O. Dapice, Malcolm McPherson, Michael J. Montesano, Thomas J. Vallely, and Ben Wilkinson, November 2011
In May 2010, a team from the Rajawali Foundation Institute for Asia at Harvard Kennedy School wrote a report on approaches to the revitalization of Myanmar’s agricultural sector for Proximity Designs, a Myanmar (Burma) social entrepreneurship organization. The same Harvard Kennedy School team (with one extra member) visited Myanmar in June 2011 to update and expand upon its 2010 report. Important changes had occurred since May 2010. A new government had assumed control; in an atmosphere of anticipation and some excitement, new and potentially effective policies were being discussed and developed. The drought in the Dry Zone had ended, but unseasonable rains had affected production. Some initiative had been taken to offer more agricultural credit to farmers, an important suggestion of the May 2010 report. More»
David O. Dapice, Malcolm McPherson, Michael J. Montesano, Thomas J. Vallely, and Ben Wilkinson, November 2011
In May 2010, a team from the Rajawali Foundation Institute for Asia at Harvard Kennedy School wrote a report on approaches to the revitalization of Myanmar’s agricultural sector for Proximity Designs, a Myanmar (Burma) social entrepreneurship organization. The same Harvard Kennedy School team (with one extra member) visited Myanmar in June 2011 to update and expand upon its 2010 report. Important changes had occurred since May 2010. A new government had assumed control; in an atmosphere of anticipation and some excitement, new and potentially effective policies were being discussed and developed. The drought in the Dry Zone had ended, but unseasonable rains had affected production. Some initiative had been taken to offer more agricultural credit to farmers, an important suggestion of the May 2010 report. More»
The Myanmar Exchange Rate: A Barrier to National Strength
David O. Dapice, Malcolm McPherson, Michael J. Montesano, Thomas J. Vallely, and Ben Wilkinson, June 2011
The exchange rate is one of the most important tools in economic development. In Myanmar (Burma), an overvalued exchange rate is currently undermining economic activity involving all tradable goods. If this situation persists, the country’s industrial base will shrink, investors will be discouraged, unemployment will rise, poverty will deepen, more people will leave the country, the divide between rich and poor will grow, and national strength and the people’s prosperity will be diminished if not destroyed. Myanmar’s overvalued exchange rate is inconsistent with the development experience throughout Asia since 1945. More»
David O. Dapice, Malcolm McPherson, Michael J. Montesano, Thomas J. Vallely, and Ben Wilkinson, June 2011
The exchange rate is one of the most important tools in economic development. In Myanmar (Burma), an overvalued exchange rate is currently undermining economic activity involving all tradable goods. If this situation persists, the country’s industrial base will shrink, investors will be discouraged, unemployment will rise, poverty will deepen, more people will leave the country, the divide between rich and poor will grow, and national strength and the people’s prosperity will be diminished if not destroyed. Myanmar’s overvalued exchange rate is inconsistent with the development experience throughout Asia since 1945. More»
Park Chung Hee’s International Legacy
William H. Overholt, May 2011
Former U.S. President Bill Clinton had an enormously successful campaign slogan: “It’s the economy, stupid.” Whereas Clinton just saved a campaign with this strategy, Park Jung Hee saved a country.
Park Jung Hee took over the most threatened country in the world in 1961. South Korea had been devastated by the Korean War just a few years earlier. Its economy remained one of the world’s poorest. Its political stability appeared to be among the world’s poorest. It faced a formidable opponent with greater natural resources, superior industrial power, seemingly superior political stability and the backing of Mao Zedong’s unified and determined China. More»
William H. Overholt, May 2011
Former U.S. President Bill Clinton had an enormously successful campaign slogan: “It’s the economy, stupid.” Whereas Clinton just saved a campaign with this strategy, Park Jung Hee saved a country.
Park Jung Hee took over the most threatened country in the world in 1961. South Korea had been devastated by the Korean War just a few years earlier. Its economy remained one of the world’s poorest. Its political stability appeared to be among the world’s poorest. It faced a formidable opponent with greater natural resources, superior industrial power, seemingly superior political stability and the backing of Mao Zedong’s unified and determined China. More»
Revitalizing Agriculture in Myanmar: Breaking Down Barriers, Building a Framework for Growth
David O. Dapice, Mike Montesano, Thomas J. Vallely, and Ben Wilkinson, July 2010
This is a study of the rice economy in Myanmar (Burma). It seeks to identify barriers and bottlenecks that are hindering growth and depressing value in a sector that must play a central role in alleviating the extreme poverty that currently afflicts an expanding proportion of rural households. The issues that this paper addresses are of importance to the entire Myanmar economy and its prospects for achieving a higher level of growth and delivering prosperity to the Myanmar people. This is because many of the barriers to greater productivity in the rice economy are also obstacles to growth of the economy as a whole. More»
David O. Dapice, Mike Montesano, Thomas J. Vallely, and Ben Wilkinson, July 2010
This is a study of the rice economy in Myanmar (Burma). It seeks to identify barriers and bottlenecks that are hindering growth and depressing value in a sector that must play a central role in alleviating the extreme poverty that currently afflicts an expanding proportion of rural households. The issues that this paper addresses are of importance to the entire Myanmar economy and its prospects for achieving a higher level of growth and delivering prosperity to the Myanmar people. This is because many of the barriers to greater productivity in the rice economy are also obstacles to growth of the economy as a whole. More»
Beyond the Apex: Toward a System Level Approach to Higher Education Reform in Vietnam
Vietnam Program, July 2010
A broad consensus has emerged in Vietnam that higher education is in need of deep and wide-reaching reform. This consensus extends from students and their families to public intellectuals and educators to policymakers at the highest levels of government. Vietnam‘s national competitiveness increasingly depends on skilled human capital, which its higher education system is not delivering. Ever growing numbers of families are choosing to send their children abroad for undergraduate and even high school education in order for them to acquire the skills and credentials needed to succeed in the global economy. More»
Vietnam Program, July 2010
A broad consensus has emerged in Vietnam that higher education is in need of deep and wide-reaching reform. This consensus extends from students and their families to public intellectuals and educators to policymakers at the highest levels of government. Vietnam‘s national competitiveness increasingly depends on skilled human capital, which its higher education system is not delivering. Ever growing numbers of families are choosing to send their children abroad for undergraduate and even high school education in order for them to acquire the skills and credentials needed to succeed in the global economy. More»
The Intangibles of Excellence: Governance and the Quest to Build a Vietnamese Apex Research University
The New School, June 2009
Knowledge and human capital are now the main drivers of economic development and the key determinants of national competitiveness. The role of research universities in the development process has changed as a result of the emergence of the knowledge economy. Research universities educate a country’s most talented students, irrespective of socioeconomic status; their graduates serve society in important ways, as innovators, entrepreneurs, managers, civil servants, and political and civic leaders. In developing countries, apex research universities often play a critical role in adapting advancements in global knowledge to conditions in their own countries. The knowledge generated by research universities contributes to social well being and prosperity. Research universities are increasingly viewed as symbols of national prestige. Having a handful of research universities benefits the entire national education system by producing highly qualified professors and teachers. For all of these reasons, countries have expended vast sums of money in an effort to build world-class research universities. However, the results of these efforts have been mixed. More»
The New School, June 2009
Knowledge and human capital are now the main drivers of economic development and the key determinants of national competitiveness. The role of research universities in the development process has changed as a result of the emergence of the knowledge economy. Research universities educate a country’s most talented students, irrespective of socioeconomic status; their graduates serve society in important ways, as innovators, entrepreneurs, managers, civil servants, and political and civic leaders. In developing countries, apex research universities often play a critical role in adapting advancements in global knowledge to conditions in their own countries. The knowledge generated by research universities contributes to social well being and prosperity. Research universities are increasingly viewed as symbols of national prestige. Having a handful of research universities benefits the entire national education system by producing highly qualified professors and teachers. For all of these reasons, countries have expended vast sums of money in an effort to build world-class research universities. However, the results of these efforts have been mixed. More»
Vietnam's Industrial Policy: Designing Policies for Sustainable Development
Dwight Perkins and Vu Thanh Tu Anh, March 2009
Vietnam has made a remarkable transition since 1989 from a centrally planned industrial sector dominated by administrative allocation of inputs and outputs to an industrial sector governed mainly by market forces. Furthermore, Vietnam accomplished this transition while avoiding the sharp fall in GDP and industrial output that occurred in so many other centrally planned economies. In the 1980s, Vietnamese exports covered less than half of the country’s relatively small import requirements and virtually no Vietnamese industries were capable of selling their products in the demanding markets of Europe and North America. Twenty years later Vietnamese exports are twenty fold what they were in the 1980s and industrial products sold around the world are the largest contributors to these export sales. More»
Dwight Perkins and Vu Thanh Tu Anh, March 2009
Vietnam has made a remarkable transition since 1989 from a centrally planned industrial sector dominated by administrative allocation of inputs and outputs to an industrial sector governed mainly by market forces. Furthermore, Vietnam accomplished this transition while avoiding the sharp fall in GDP and industrial output that occurred in so many other centrally planned economies. In the 1980s, Vietnamese exports covered less than half of the country’s relatively small import requirements and virtually no Vietnamese industries were capable of selling their products in the demanding markets of Europe and North America. Twenty years later Vietnamese exports are twenty fold what they were in the 1980s and industrial products sold around the world are the largest contributors to these export sales. More»
Assessment of the Myanmar Agricultural Economy
Vietnam Program, March 2009
During two weeks in January 2009 a team from the Rajawali Foundation Institute for Asia, International Development Enterprises (IDE), and the Ministry of Agriculture and Irrigation of the Union of Myanmar conducted a humanitarian assessment of food production and the agricultural economy in Myanmar. This report summarizing the team's findings and focuses on paddy production, because rice is the country’s staple crop. Based on field work in cyclone-affected areas of the Ayeyarwady River Delta and in Upper Myanmar, the report concludes that paddy output is likely to drop in 2009, potentially creating a food shortage by the third quarter. Estimates are based on imperfect data, and this scenario may not materialize, but the avoidance of a food shortage this year would represent a temporary reprieve, not a recovery. More»
Vietnam Program, March 2009
During two weeks in January 2009 a team from the Rajawali Foundation Institute for Asia, International Development Enterprises (IDE), and the Ministry of Agriculture and Irrigation of the Union of Myanmar conducted a humanitarian assessment of food production and the agricultural economy in Myanmar. This report summarizing the team's findings and focuses on paddy production, because rice is the country’s staple crop. Based on field work in cyclone-affected areas of the Ayeyarwady River Delta and in Upper Myanmar, the report concludes that paddy output is likely to drop in 2009, potentially creating a food shortage by the third quarter. Estimates are based on imperfect data, and this scenario may not materialize, but the avoidance of a food shortage this year would represent a temporary reprieve, not a recovery. More»
Vietnam's Infrastructure Constraints
David Dapice and Nguyen Xuan Thanh, February 2009
Successful countries provide economy and society with infrastructure needed to maintain growth. Development experience suggests that investing 7 percent of GDP in infrastructure is the right order of magnitude for high and sustained growth. Over the last twelve years, the government of Vietnam was able to sustain infrastructure investment at 10 percent of GDP. This remarkably high level of investment has resulted in a rapid expansion of infrastructure stocks and improved access. Despite this achievement, Vietnam is experiencing more and more infrastructure weaknesses that negatively affect its ability to sustain high economic growth in the long term. Transport and electricity – the two most essential infrastructure activities – appear to be the weakest infrastructure sectors in Vietnam with blackouts and traffic jams occurring more and more frequently. More»
David Dapice and Nguyen Xuan Thanh, February 2009
Successful countries provide economy and society with infrastructure needed to maintain growth. Development experience suggests that investing 7 percent of GDP in infrastructure is the right order of magnitude for high and sustained growth. Over the last twelve years, the government of Vietnam was able to sustain infrastructure investment at 10 percent of GDP. This remarkably high level of investment has resulted in a rapid expansion of infrastructure stocks and improved access. Despite this achievement, Vietnam is experiencing more and more infrastructure weaknesses that negatively affect its ability to sustain high economic growth in the long term. Transport and electricity – the two most essential infrastructure activities – appear to be the weakest infrastructure sectors in Vietnam with blackouts and traffic jams occurring more and more frequently. More»
Structural Change: The Only Effective Stimulus
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, and Ben Wilkinson, January 2009
This paper responds to a request from the Vietnamese government for an analysis of the impact of the global economic crisis on Vietnam, and policy recommendations to help the government stimulate growth and reduce the risk of financial crisis. The government has proposed an economic stimulus valued at six billion U.S. dollars, although details of this plan are still being worked out as this document is prepared. The roots of macroeconomic instability in Vietnam are domestic, and that the appropriate policy response is structural change. This paper argues that the deepening of the international economic downturn strengthens the case for structural reforms. Further, the paper suggests that the fiscal and monetary stimulus proposed by the government will not have the desired impact but will instead accelerate inflation and increase systemic financial risks. The authors recommend an alternative set of policies including gradual depreciation of the VND and adjustments to the public investment program to delay capital and import intensive projects in favor of labor intensive projects that do not rely heavily on imports. More»
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, and Ben Wilkinson, January 2009
This paper responds to a request from the Vietnamese government for an analysis of the impact of the global economic crisis on Vietnam, and policy recommendations to help the government stimulate growth and reduce the risk of financial crisis. The government has proposed an economic stimulus valued at six billion U.S. dollars, although details of this plan are still being worked out as this document is prepared. The roots of macroeconomic instability in Vietnam are domestic, and that the appropriate policy response is structural change. This paper argues that the deepening of the international economic downturn strengthens the case for structural reforms. Further, the paper suggests that the fiscal and monetary stimulus proposed by the government will not have the desired impact but will instead accelerate inflation and increase systemic financial risks. The authors recommend an alternative set of policies including gradual depreciation of the VND and adjustments to the public investment program to delay capital and import intensive projects in favor of labor intensive projects that do not rely heavily on imports. More»
Funding Economic Development: A Comparative Study of Financial Sector Reform in Vietnam and China
Jay Rosengard and Huynh The Du, January 2009
Given the importance of financial sector development for sustained economic growth, especially in the context of Vietnam’s own performance since embarking the Đổi Mới economic reforms twenty years ago, the objective of this study is to analyze the financial sector development in Vietnam and China within the framework of financial sector reforms introduced in the two countries. The study assesses the progress to date and future challenges for each country; compares and contrasts financial sector reform strategies and performance; and formulates policy recommendations for further financial sector reform in Vietnam. More»
Jay Rosengard and Huynh The Du, January 2009
Given the importance of financial sector development for sustained economic growth, especially in the context of Vietnam’s own performance since embarking the Đổi Mới economic reforms twenty years ago, the objective of this study is to analyze the financial sector development in Vietnam and China within the framework of financial sector reforms introduced in the two countries. The study assesses the progress to date and future challenges for each country; compares and contrasts financial sector reform strategies and performance; and formulates policy recommendations for further financial sector reform in Vietnam. More»
The Structural Roots of Macroeconomic Instability
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, Ben Wilkinson, September 2008
This paper responds to a request from the Vietnamese government for an analysis of the short- and long-term challenges confronting the Vietnamese economy. The paper argues that restoring macroeconomic stability and positioning the economy for long term growth will require fundamental, structural reform. The paper begins by comparing Vietnam's performance over the past 20 years to other countries in the region. This comparison reveals a set of worrisome trends which, taken together, raise questions about the sustainability of Vietnam's growth path. Part II examines the current macroeconomic environment and assesses the government's response to date. The paper concludes that, while government policy has succeeded in reducing macroeconomic turbulence in the short run, nothing has been done to address the structural weaknesses of the Vietnamese economy. More»
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, Ben Wilkinson, September 2008
This paper responds to a request from the Vietnamese government for an analysis of the short- and long-term challenges confronting the Vietnamese economy. The paper argues that restoring macroeconomic stability and positioning the economy for long term growth will require fundamental, structural reform. The paper begins by comparing Vietnam's performance over the past 20 years to other countries in the region. This comparison reveals a set of worrisome trends which, taken together, raise questions about the sustainability of Vietnam's growth path. Part II examines the current macroeconomic environment and assesses the government's response to date. The paper concludes that, while government policy has succeeded in reducing macroeconomic turbulence in the short run, nothing has been done to address the structural weaknesses of the Vietnamese economy. More»
Surviving a Crisis, Returning to Reform
Vietnam Program, May 2008
The Vietnamese economy is facing its most serious challenges since the mid-1980s. Over the past several months the government has stated its determination to curb inflation and restore macroeconomic stability. These are indeed critical priorities, but the government’s actions to date to achieve this end have been largely ineffectual. This Vietnam Policy Discussion Paper argues that a restoration of the situation prior to the onset of the current instability is neither possible nor desirable. This is because the current situation is due largely to structural weaknesses in the Vietnamese economy; the international conditions that have been offered as explanations are, at best, secondary factors. More»
Vietnam Program, May 2008
The Vietnamese economy is facing its most serious challenges since the mid-1980s. Over the past several months the government has stated its determination to curb inflation and restore macroeconomic stability. These are indeed critical priorities, but the government’s actions to date to achieve this end have been largely ineffectual. This Vietnam Policy Discussion Paper argues that a restoration of the situation prior to the onset of the current instability is neither possible nor desirable. This is because the current situation is due largely to structural weaknesses in the Vietnamese economy; the international conditions that have been offered as explanations are, at best, secondary factors. More»
Macroeconomic Instability: Causes and Policy Responses
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, and Ben Wilkinson, February 2008
This paper argues that a series of resolute and coordinated policy interventions is needed to restore macroeconomic stability, cushion the impact of the global economic downturn, and keep Vietnam on the path of sustainable growth. Specifically, the Vietnamese government must quell price inflation, reduce fiscal and trade deficits and slow down money and credit growth through a consistent and synchronized set of policy interventions. Gradual deflation of the real estate price bubble is needed in order to avoid a sudden collapse in prices, which would, if it occurred, destabilize the financial sector with potentially serious contagion effects for the real economy. Successful implementation of these policy prescriptions in the near term, and maintaining a stable economic environment over the medium to long term, will require greater policy coordination than the Vietnamese government has demonstrated in recent years. More»
Nguyen Xuan Thanh, Vu Thanh Tu Anh, David Dapice, Jonathan Pincus, and Ben Wilkinson, February 2008
This paper argues that a series of resolute and coordinated policy interventions is needed to restore macroeconomic stability, cushion the impact of the global economic downturn, and keep Vietnam on the path of sustainable growth. Specifically, the Vietnamese government must quell price inflation, reduce fiscal and trade deficits and slow down money and credit growth through a consistent and synchronized set of policy interventions. Gradual deflation of the real estate price bubble is needed in order to avoid a sudden collapse in prices, which would, if it occurred, destabilize the financial sector with potentially serious contagion effects for the real economy. Successful implementation of these policy prescriptions in the near term, and maintaining a stable economic environment over the medium to long term, will require greater policy coordination than the Vietnamese government has demonstrated in recent years. More»
Choosing Success: The Lessons of East and Southeast Asia and Vietnam's Future
Vietnam Program, January 2008
"For Vietnam, success is a choice." This sums up the verdict delivered by the Center's Vietnam Program to the government of Vietnam in early 2008. In a country accustomed to outpourings of praise from multilateral donors for its economic performance, the sobering assessment was headline news. On January 15, 2008, a Vietnam Program delegation headed by Director Tom Vallely met with Prime Minister Nguyen Tan Dung in Hanoi, and presented him with this report. The paper was written in response to a request from Prime Minister Dung that the Vietnam Program conduct a critical analysis of Vietnam's socioeconomic development strategy for the period through 2020. More»
Vietnam Program, January 2008
"For Vietnam, success is a choice." This sums up the verdict delivered by the Center's Vietnam Program to the government of Vietnam in early 2008. In a country accustomed to outpourings of praise from multilateral donors for its economic performance, the sobering assessment was headline news. On January 15, 2008, a Vietnam Program delegation headed by Director Tom Vallely met with Prime Minister Nguyen Tan Dung in Hanoi, and presented him with this report. The paper was written in response to a request from Prime Minister Dung that the Vietnam Program conduct a critical analysis of Vietnam's socioeconomic development strategy for the period through 2020. More»
Choosing Success: The Lessons of East and Southeast Asia and Vietnam’s Future
Vietnam Program, Rajawali Institute for Asia, January 2008
In early 2008, a HKS Vietnam Program delegation headed by Program Director Tom Vallely met with Prime Minister Nguyen Tan Dung in Hanoi, and presented him with this sobering assessment of Vietnam's economic outlook. The report was written in response to the Prime Minister's request for a critical analysis of Vietnam's socioeconomic development strategy for the period through 2020. Choosing Success was authored by HKS faculty members Anthony Saich and Dwight Perkins; Vietnam Program Economist David Dapice; and faculty from the Fulbright School in Ho Chi Minh City, including Vu Thanh Tu Anh, Nguyen Xuan Thanh, and Huynh The Du. More»
Vietnam Program, Rajawali Institute for Asia, January 2008
In early 2008, a HKS Vietnam Program delegation headed by Program Director Tom Vallely met with Prime Minister Nguyen Tan Dung in Hanoi, and presented him with this sobering assessment of Vietnam's economic outlook. The report was written in response to the Prime Minister's request for a critical analysis of Vietnam's socioeconomic development strategy for the period through 2020. Choosing Success was authored by HKS faculty members Anthony Saich and Dwight Perkins; Vietnam Program Economist David Dapice; and faculty from the Fulbright School in Ho Chi Minh City, including Vu Thanh Tu Anh, Nguyen Xuan Thanh, and Huynh The Du. More»
Improving Secondary Education Through Institutional Innovation: A Report to UNDP and UNICEF
Vietnam Program, August 2006
This report records the findings of a mission to Cambodia sponsored by the UNDP and UNICEF. The objective of the mission was to assess the present state of education in Cambodia and to make recommendations for how new investment might be used effectively to promote continued reform through institutional innovation. The mission was convened against the backdrop of ongoing negotiations between the U.S. and Cambodia over several PL-480 “humanitarian” loans made to the government of Lon Nol (1970-1975). There is bipartisan interest in the U.S. Congress in allocating these payments to support Cambodia’s continued development. It has been suggested that if and when Cambodia agrees to a repayment scheme, the United States government might use these repayments to endow a special vehicle to support education in Cambodia. More»
Vietnam Program, August 2006
This report records the findings of a mission to Cambodia sponsored by the UNDP and UNICEF. The objective of the mission was to assess the present state of education in Cambodia and to make recommendations for how new investment might be used effectively to promote continued reform through institutional innovation. The mission was convened against the backdrop of ongoing negotiations between the U.S. and Cambodia over several PL-480 “humanitarian” loans made to the government of Lon Nol (1970-1975). There is bipartisan interest in the U.S. Congress in allocating these payments to support Cambodia’s continued development. It has been suggested that if and when Cambodia agrees to a repayment scheme, the United States government might use these repayments to endow a special vehicle to support education in Cambodia. More»
