Addressing a press conference to launch the WB’s new study “An East Asian Renaissance: Ideas for Growth” in Hanoi on June 6, Home Kharas, the bank’s former East Asia and Pacific chief economist and co-author of the study, said that Vietnam has proactively integrated into global and regional economies and achieved rapid economic growth rates.

However, while other East Asian countries such as China, Indonesia, Malaysia, the Philippines and Thailand have already become middle-income countries, Vietnam has strived for the target by 2010. Only a few key economic areas have reached middle-income levels while the remainder of the country has remained at a low-income level.

Therefore, battle-tested strategies for low-income countries such as Vietnam will be maintaining a stable macro economy, opening trade, strengthening education and attracting investment, Kharas said. However, Vietnam must turn to urgent domestic challenges of inequality, corruption and environmental degradation that have arisen from its successes.

Vietnam also needs to adapt a new development strategy that focuses on social cohesion and the building of dynamic and connected cities that are linked both domestically and to the outside world, he said.

Meanwhile, Dr. Indermit S. Gill, economic adviser to the World Bank’s East Asia and Pacific chief economist, said that Vietnam has done well in delivering social services, which in his opinion, is one of major tasks for middle-income countries to ensure social equality.

Martin Rama, the WB’s lead economist in Vietnam, said as the country’s capital market is becoming hot, the Vietnamese government should maintain a stable macro economy and improve financial systems in a transparent way so that it would minimise factors leading to inequality between economic sectors.