Economist Pham Chi Lan: ‘Policy discussions should be honest and forthright’

As the former deputy president of the Vietnam Chamber of Commerce and Industry (VCCI), and member of Advisory Group of the Vietnam National Assembly’s Economic Commission, she has advocated for private sector and SME development, economic reforms and the Vietnam’s integration into the global economy.

On the occasion of the Vietnam businessmen's day (Oct 13) and the Vietnamese women's day (Oct 20), Pham Chi Lan had an interesting discussion with young business women at the event “Vietnamese women in modern economy" held by Finance Business News Corporation (FBNC) in Ho Chi Minh City.

In recent studies, you warned that the rise of automation poses risks for female laborers. Could you elaborate on this issue?

Economist Pham Chi Lan: It is clearly an issue in the textile and footwear industry. Increasingly sophisticated products require labors to be more ingenious. This makes it harder for older women, who have made up a significant share of employment in this sector, to continue working.

Cheap labor for assembly, which Vietnam has used to its advantage for 20 years, is no longer delivering the same benefits. A garment factory was recently told me that it has to discharge 3,000 female workers due to increasing automation.

The same experience is occurring in many other enterprises in the south of Vietnam. It is unavoidable, however, as businesses simply cannot compete if they resist the rising tide of automation.

Twenty years ago, when I visited a business in Hai Phong, I only saw 20-25 year-old women labours, then I asked for reason why there are no older women? They gave me an answer that women over 30 are not suitable for carpet weaving.

Many critics say Vietnam’s integration into the world economy has been somewhat disappointing because its position in global value chains remains at a low level. Do you agree?

Economist Pham Chi Lan: Japan and South Korea used to make shoes for Nike, but only for 5 years. Meanwhile, Vietnam has held the position of processing for a quarter of century and is still proud of it.

Nike’s shoes are labelled "Made in Vietnam" but in fact, we only get about 1 USD from a pair. It seems to be the root cause of women workers’ trouble.

Vietnamese people always consider themselves hardworking, but I am not sure about it. My view is that hard working people are those who work with thoughts, not just machines that obey the instructions of others. Regarding managers, they must first think for their business, then the country, not only for their own interests.

In the economic integration process, we also give too much credit to ourselves. Vietnam only gains a maximum of 15% in the annual export turnover of US$20 billion of textile and garment industry. Similar issue can be seen in the case of Samsung.

If we keep assuming FDI enterprises’ revenue to be ours, then rolling out the red carpet for them, one day, as they find better environment for their business and leave us, we will have to pay a heavy price.

Are Vietnamese women spending money too extravagantly?

Economist Pham Chi Lan: I think only those who make money so easily spend money extravagantly, conversely, people who work hard do not spend in such way.

Most Vietnamese women know how to save and sacrifice for their family. That they are sparing does not mean they are stingy and careless, especially businesswomen, as they know that money will proliferate, and they will know how to value the money to use it more effectively.

As far as I know, women in Hanoi Women's Business Club are very active in charity activities; they are always willing to spend their money to help the needy.

In your opinion, what are the advantages and disadvantages of businesswomen when stepping into business field?

Economist Pham Chi Lan: Women are naturally kindhearted, but also quite determined. Taking Ms. Mai Kieu Lien, Vinamilk CEO for example, at the time Vietnam started to implement equitization, if she had kept enjoying government’s subsidies, Vinamilk could not have been successful as today. Another typical example is Mrs.Mai Thanh, Chairwoman and General Director of REE Corporation, who is also a pioneer model of the country’s equitization process.

Such women are very strong and ambitious. They, with great passion, always eager to learn and attract others who share mutual passion. A leader, without such will power and passion, cannot win other’s hearts.

With the rise of social networking, personal life seems to be more intertwined with the world of business. How would you think that women to cope with these issues?

Economist Pham Chi Lan: Under the influence of social networking, you have to be yourself and be selective among load of information.

I spend about two hours per day reading things online, because there are so many articles and good books to read; however, do not let yourself be "dragged away" by other things rather than yourself.

Working with young people, I always advise them to focus on their work and life as they cannot satisfy everyone, just live as fully as they can.

How do you evaluate the role of industry associations and women's unions in supporting female employees?

Economist Pham Chi Lan: I want to see an effective union working properly with its mission, which is to protect workers' rights. So do other organizations; they are supposed to be a good listener to support women.

It is odd that the Government of Vietnam is much more concerned about the monthly and quarterly GDP growth rate than the employment rate. In many other, countries it is the opposite. So little attention is devoted to employment data that our statistics are very unreliable.

In the next 10 years, the index related to employment issue should be the most important indicator.

On the other hand, women's skills need to be improved to confront with the wave of automation as 10 years from now. The government must create favorable conditions for women, especially those who work in manual jobs, to shift to other fields. Most importantly, authorities must foresee the upcoming trends to help them adapt with modern tools.

In the Vietnam 2035 report, we have envisioned the challenges of Vietnam in the coming time, and recommended that service, tourism and agriculture sectors need to develop strongly by utilizing the technological strength to create more new jobs.

In the future, the number of famers directly working in the field will reduce to only 15-20%, and a large number of farmers (20-25%) will be transferred to the sectors related to agriculture processing, which opens a new door for workers.

What's your secret to keep patient and gentle for years fighting for a private business?

Economist Pham Chi Lan: Much like policy discussion, businesswomen need to be firm to achieve results.

During 37 years I worked at VCCI, my main task was to improve business environment for the private sector. It was not until 1999 that the Enterprise Law was enacted. Even when it came into effect, we continued fighting to remove sub-licenses.

After eliminating about 200 sub-licenses, several years later, the number of sub-licenses again mushroomed and now there are up to 5,200 types of business conditions.

It is the war that never stops. I only participated in a very small part. At this age, I sometimes want to take a rest, but I still wonder why so many people trying to tackle existing problems, such as abovementioned one, but they will flare up even more intense.

Thus, how can I sit still and ignore all the obstacles for businesses? Indeed, we could count on the fingers of one hand the number of those who dare to speak up frankly!

Thank you very much!