Vietnam: Mobilizing Overseas Vietnamese Human Capital to Promote Economic Growth in Vietnam

2005

Associate Professor Binh Tran-Nam

Following the end of the Vietnam War, there has been a massive outflow of Vietnamese refugees and migrants to developed countries, normally with restrictive immigration policies such as in North America, Western Europe and Australasia. The total number of Vietnam-born persons living outside Vietnam is currently estimated between 2.5 and 3 million; nearly half of that number residing in the US. After three decades of resettlement, the community of overseas Vietnamese collectively possesses a considerable amount of economic resources. Working towards channeling these resources to aid economic growth in Vietnam represents both an exciting opportunity and a difficult challenge for the Vietnamese Government.

Overseas Vietnamese have been playing an important role in sending much-needed hard currency to Vietnam. Their remittances to Vietnam reached 1.75 billion, 2.15 billion, 3 billion and more than 3 billion USD in 2001, 2002, 2003 and 2004, respectively. Their total remittance to Vietnam in the past 14 years amounted to over US$15 billion, which is equivalent to almost 60 per cent of the FDI implemented in Vietnam during the same period and is greater than the total disbursed ODA since 1993. Assuming that remittances to Vietnam from overseas Vietnamese represent 10 per cent of their income, this implies that the combined annual income of Vietnamese emigrants is at least US$30 billion, which equals about 75 per cent of Vietnam's current GDP. This is indeed a tremendous resource for Vietnam to draw upon for its FDI requirements in the future.

Even more important than the overseas Vietnamese community's financial capability is their human capital. They are well educated and trained, have access to up-to-date knowledge and possess substantial technical and managerial work experience. For example, based on the US Census 2000 data, there were in the US about 190,000 Vietnamese university graduates; about 34,000 of whom held doctoral degrees. They work in many industries that are strategic to Vietnam's drive for modernization. The number of overseas Vietnamese in the US holding managerial positions (ranging from line manager and operating manager to executive director) is also substantial.

The Vietnamese Government has so far enjoyed only limited successes in tapping into this vast pool of human capital. This remains so for several main reasons. First, many Vietnamese intellectuals living overseas still distrust or oppose the Vietnamese Government due to ideological differences or unhappy personal experiences. Additionally, for those who are willing to cooperate with the Government, they often risk the wrath of their local communities and media. Secondly, despite the Government's recognition of the potentially important role of overseas Vietnamese, the various government departments are not yet ready and have no strategic or specific plans to fully utilize the short or long-term contributions of overseas Vietnamese experts. The various exchanges between in-country and overseas Vietnamese intellectuals are often fragmented, irregular, and not well coordinated or publicized. Thirdly, emigrant experts who are considering to return to Vietnam often find that the gaps in living and working conditions between developed countries and Vietnam are far too great to be successfully overcome.

However, recent developments suggest that the stage is set for an increasingly higher level of mobilization of the overseas Vietnamese community's human capital in order to promote economic growth in Vietnam. First, regional and international integration has brought home to the Vietnamese the sad reality of how underdeveloped their country still is after almost two decades of Doi Moi. In a recent press article, former Prime Minister Vo Van Kiet forcefully argued that poverty and backwardness are truly Vietnam's new enemies. He then emphasized the importance of a new level of unity consciousness amongst the Vietnamese in the fight against these new enemies. His view sought to bring the strength of the entire Vietnamese people into play by mobilizing all their resources, including those of overseas Vietnamese.

Secondly, after 30 years, there is now a generation of overseas-born people of Vietnamese ancestry in various developed nations around the globe. Many of these persons are both highly competent and enthusiastic towards helping Vietnam. Unlike their parents' generation, they are almost free of divisive political ideologies. These young people are thus willing and ready to help Vietnam to develop, and expect little in return.

Thirdly, the overseas Vietnamese experts in the age group of 50 65 now have independent children and are financially secure. Many of them are willing to either spend substantial periods of time in Vietnam or return permanently. These persons possess not only rich cultural knowledge and a vast wealth of education and work experience but also important international networks. They can provide the urgently needed 'grey matter', which may be utilized to guide Vietnam to a path of modernity and prosperity.

Willingness and readiness from both parties are necessary but not sufficient to ensure a satisfactory outcome. Recent incentives to attract overseas Vietnamese intellectuals announced at a government-sponsored workshop held in Hanoi during last August are appropriate, but more should be done and done quickly. First and foremost, the Vietnamese Government needs to demonstrate a more genuine spirit of national reconciliation, including acknowledgement of past policy shortcomings. Secondly, the Government should draw lessons from the strategies of China and India, which have been very successfully in bringing together the strengths of their overseas communities for domestic development. Thirdly, specific policy measures need to be not only carefully thought out and consistently executed but also well coordinated between relevant government departments (for example, Science and Technology, Education and Training, and Investment and Planning).

The policy measures should be both forward looking and flexible, and focus upon quality rather than quantity with respect to overseas Vietnamese human capital. Some specific measures that deserve consideration are:

" simplifying travel conditions for overseas Vietnamese to and within Vietnam; " extending the right of overseas Vietnamese to purchase property in Vietnam; " granting dual citizenship to those overseas Vietnamese intellectuals who return home permanently (after a qualifying period); " providing tax incentives and housing subsidies to selected returnees in the early stage of their resettlement; " organizing regular international conferences in relevant areas to link up in-country and overseas Vietnamese experts; " building a technology park and a financial centre (including the stock market) to attract overseas Vietnamese IT and financial specialists, respectively.

A particular area in which overseas Vietnamese experts could contribute and make an immediate impact is in the urgently needed reform of the tertiary education sector in Vietnam. More specifically, in their various capacities as planners, administrators, teachers, researchers and international network facilitators, they could help to establish a high quality multidisciplinary university. This would fit in splendidly with the Government's university reform plan as highlighted by Prime Minister Phan Van Khai during his visit to Harvard University in June this year.

WATCHPOINT: How the Vietnamese Government enacts the recently announced incentive measures will indicate the seriousness of their commitment to mobilizing overseas Vietnamese grey matter.

 

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