National Focus

Labor migration helps to boost Vietnam economy

By Dang Hoa October 11, 2017 | 07:31 AM GMT+7

Easing restriction on labor migration can boost workers’ welfare and deepen regional economic integration, according to the World Bank's report on “Migrating to opportunity” just released.

Labor migration helps to reduce poverty in Vietnam. (Photo: the Internet)

The intra-regional migration in ASEAN in general and in Vietnam, in particular, has increased significantly, especially in the period from 1995 to 2015, which has impacted significantly on its economy.

On average, the remittance sent to Vietnam which significantly helped to reduce poverty accounted for seven percent of its Gross Domestic Products (GDP), compared to ten per cent in the Philippines, five per cent in Myanmar and three per cent in Cambodia. 

Remittance sent to Vietnam in 2017 accounted for seven per cent of GDP (source: WB)

According to World Bank Economist for the Social Protection and Jobs Global Mauro Testaverde, Vietnamese labors mostly migrated to Malaysia as this is one of its traditional markets and also Malaysia’s average monthly wage is triple that of Vietnam. He also said that ASEAN is not a preferable market to Vietnamese when Vietnamese labor migrants accounted for only two per cent of the regional figure. In order to encourage more people to work in regional countries, the government should propose and implement more policies and interventions. 

Besides, the emigration of high-skilled individuals in Vietnam accounting for 10 per cent has created the effects of “brain circulation” which means both contributing to sending and receiving countries. However, the low-skilled labors are not always able to take advantage of the high-salary jobs in ASEAN due to the lack of information.

“With the right policy choices. Sending countries can reap the economic benefits of out-migration while protecting their citizens who choose to migrate for work. Inappropriate policies and ineffective institutions mean that the region is missing opportunities to gain fully from migration,” said Sudhir Shetty, WB Chief Economist for the East Asia Pacific region. Therefore, according to the report, Vietnam will need to evaluate its current policies for incentivizing outmigration to determine whether they are meeting the country’s needs.

The 4.0 industrial revolution brings about economic efficiency, higher labor productivity, product improvements and better competitiveness; however, it will undeniably pose a big labor problem as millions of jobs in many countries including Vietnam will be affected.

Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) said that nine million Asian people may lose their jobs and 85 per cent of textile-garment and leather-footwear workers Vietnam would face the onslaught of automation in the 4.0 industrial revolution (4IR).

"However, if Vietnam can make the most of its strengths in such fields as tourism, agriculture, and crafts, it can address the detrimental impact of the 4IR as other nations are focusing on mass production," he said.

CEO Group chairman unveils guide to Vietnam real estate for foreigners

CEO Group chairman unveils guide to Vietnam real estate for foreigners

National Focus -  1 month

Doan Van Binh, Chairman of CEO Group and Vice President of the Vietnam National Real Estate Association, introduced his latest book, “Vietnam Real Estate for Foreigners,” at a launch event in Hanoi on Friday.

Women leading the charge in Vietnam's green transition

Women leading the charge in Vietnam's green transition

National Focus -  2 month

Acting for increased women’s participation and leadership in climate action, Vietnam can accelerate a transition that is more inclusive, just, and impactful.

Steam for girls: A journey of passionate and creative girls

Steam for girls: A journey of passionate and creative girls

National Focus -  3 month

The "Steam for girls 2024" competition provides a creative platform for Steam and an opportunity for students to connect with peers from various regions within Vietnam and internationally.

Politburo backs North-South high-speed railway proposal

Politburo backs North-South high-speed railway proposal

National Focus -  3 month

The Politburo on Wednesday supported a plan to invest in a high-speed railway along the country’s North-South axis, marking a crucial step for the multi-billion-dollar project aimed at boosting economic growth and infrastructure development.

Ho Chi Minh City inaugurates Japan-funded wastewater treatment plant

Ho Chi Minh City inaugurates Japan-funded wastewater treatment plant

National Focus -  3 month

Ho Chi Minh City has inaugurated the expanded Binh Hung wastewater treatment plant, now the largest facility of its kind in Vietnam.

Electric vehicle market faces growth hurdles

Electric vehicle market faces growth hurdles

National Focus -  3 month

Vietnam's electric vehicle market, holding just 15 per cent of the automotive market share, shows promise but faces significant challenges in scaling up due to infrastructure and regulatory obstacles.