(VOVworld) – The resolution of the 12^th National Party Congress targets increasing Total Factor Productivity from 30 to 35% in 2020. Thu Hien comments on the likelihood of reaching that goal.

Total Factor Productivity (TFP) is a variable with inputs such as knowledge, experience, labor skills, commodity, service, efficiency of investment, technology, equipment, and management skills. In 2010 Vietnam’s TFP was 0.27%.

Achievable goals

Minister of Science and Technology Nguyen Quan said that since 2011 Vietnam’s TFP has increased steadily. From 2011 to 2014, TFP contributed about 26% of Vietnam’s national economic growth. TFP growth will boost GDP growth without much dependence on increasing investment capital, labor, ỏ natural resource exploitation. Like other countries, Vietnam has focused on improving TFP growth towards a sustainable economic growth strategy. The resolution of the 12^th National Party Congress sets that scientific and technological activities contributing 35% to economic growth by improving TFP.
Minister Quan said: “This goal is feasible. Last year TFP was 35%. It’s projected to rise to 39% this year. From 2011 to 2020, we expect the TFP average to be between 30 and 35% because it was below 20% in the initial years. With the current economic growth rate, we hope the average TFP in 10 years will be 35%.”

Opportunities and challenges

High labor productivity means increased income for workers. Joining the TPP and the ASEAN Economic Community may boost the average income, but Vietnamese workers will have to compete with high-quality labor from other countries. International integration will require workers to improve their skills to international standards and adapt to a new work and management environment.
Vu Thi Thao Vy is Vice President of the Students’ Association of the Hanoi University of Economics: “It will bring both opportunities and challenges to Vietnam. Job competition is a matter of fact. Each person has to improve their skills, such as English fluency.”

To reach its TFP goal, Vietnam has imported technology, hired experts, rallied scientists, and enhanced collaboration among institutes, universities, and businesses. Localities and sectors have continued the 2^nd phase of the program to improve product quality from 2016-2020, which includes creating 2,000 national criteria matching regional and international standards and helping 60,000 enterprises update their technology.