SOLUTIONS TO PROMOTE THE ECONOMIC STRUCTURAL TRANSFORMATION IN BAC GIANG PROVINCE TOWARDS INDUSTRIALIZATION AND MODERNIZATION TO 2020 WITH A VISION TO 2030
Nguyen Thi Van1*, Nguyen Bich Hong2
1University of Technology - TNU
2University of Economics and Business Administration – TNU
SUMMARY
This study aims to analyze economic structural transformation of industry in Bac Giang province in the period of 2006 – 2015. Data were collected through field survey and related researches and documents. The results show that this transformation has made positive changes. In general, the contribution of industry to the provincial gross domestic product (GDP) has gradually increased, while this one of agriculture tends to decrease. However, in the economic structure of the province, the service sector tends to decrease in its proportion, and this reflects the bias of local authorities in different sectors. Through the survey and field study in Bac Giang, the implementation of ECORE activities of the province still has shortcomings and it has not really created a fast restructuring, economic efficiency is therefore still low. Based on these results, the author offers some solutions to promote the economic structural transformation of industry in Bac Giang province to 2020 and vision to 2030.
Key words: economy, economic structure, economic structural transformation, Bac Giang province INTRODUCTION *
Economic structural transformation is a common development path for nations in the process of industrialization. Economic restructuring in the direction of industrialization and modernization has been identified by Vietnamese Party and State as an indispensable way for Vietnam to quickly get out of backwardness and become a civilizedand modern country. Bac Giang province, located in the northern midland and mountainous region of Vietnam, covers an area of 3,822 km2. The province’s geographic location is quite favorable for economic development. It is bordered by Lang Son, Thai Nguyen, Hai Duong, Bac Ninh, Quang Ninh province and Hanoi capital [1]. In recent years, the province has had many practical and preferential policies to speed up the process of international economic integration, expand external economic relations and make use of external economic resources to promote its socio-economic development.
However, Bac Giang's economy still faces
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many difficulties and challenges, economic structural transformaton is positive but slow.
Therefore, the province should have the right orientation and solution for future economic structural change.
THE REAL SITUATION OF ECONOMIC STRUCTURAL TRANSFORMATION IN BAC GIANG PROVINCE IN THE PERIOD OF 2006 - 2015
Compared to the general level of the country, Bac Giang province still faces with many difficulties. When re-establishing the province, in 1997, Bac Giang had a low economic base, high poverty rate (23.9%), and agricultural economy. The commodity production developed slowly. Average income per capita was only 1,871,000 VND/person.
The main economic structure is agriculture (the proportion of agriculture accounts for 55.1%, industry accounts for 15.2%, services accounts for 29.7%). Industry and services have not yet developed, the rate of industrial labor accounts for only 3%, and agricultural labor accounts for 90% [2].
Figure. 1. Structure of the province’s gross domestic product at current prices with respect to economic activity (%) [3]
Since 2006, the province's economic structural transformation has marked a major shift from a mainly agricultural province to industry-service structure with rapidly growing rate. The proportion of industry increasing and the share of agriculture reducing in the province’s gross regional domestic product (GRDP) reflect the development of economic sectors and the transformation of the economy towards industrialization.
Figure 1 shows that in terms of the proportion in the economic structure, in 2006, agriculture, forestry and aquaculture ranked first with 39.8%, however, in 2015, the first place has been shifted to the industry and construction, the service stands at second place. Thus, the sector structure tends to shift to fit the restructuring towards modernization.
The share of the industry-construction sector in GRDP tends to increase steadily, from 25.2% in 2006 to 41.6% in 2015, with a
structural shift of 16.4%. However, the increase was concentrated in a number of commodities such as electricity, electronics, garments, but depends heavily on foreign investment area, the localization rate is low, the increase mainly due to increase in width.
The share of agriculture, forestry and aquaculture in GRDP has been decreasing over the years, from 39.8% in 2006 to 23.6%
in 2015, with a structural shift of -16.2%.
However, the internal structure transferred slowly, the proportion of forestry and aquaculture is very low. Agricultural service is an area where value added can increase rapidly and contributes significantly to the total value of agricultural production, but it still occupies a very low proportion. The main agricultural products are not deeply involved in the value chain, but they are mainly concentrated in the lowest chain of production and exported mainly in raw and less processed products.
Table 1. Production value and the structure of Bac Giang’s industrial production value in the period 2006 – 2015 [3]
Year
Production value
(billion dong) Structure of production value (%)
Total Total Mining
industry
Processing industry
Production, distribution of electricity
and water
2006 1.76 100 0,65 98,53 0,82
2010 12.48 100 0,77 95,16 4,07
2015 54.49 100 2,53 93,39 4,08
Table 2. The structure of Bac Giang's agro-forestry-fishery production value (2006-2015) [3]
Year Total (%) Agricuture (%) Forestry (%) Aquacuture (%)
2006 100 94,4 3,4 2,2
2010 100 93,7 2,4 3,9
2015 100 90,0 3,6 6,4
Level of transformation -4,4 0,2 4,2
Service sector has not clearly shifted trend, sector structure increases, fluctuates, does not follow the general trend. In 2015, the proportion of the sector in the GRDP structure of the province is lower than that of 2010 and 2006, with a change of -0.1%.
Service sector structure has almost no breakthrough, not yet shown sustainability.
Wholesale and retail trade services, car and motorcycle repair account for the largest share. Production valuestructure of some service sectors such as transport and storage, finance and banking, accommodation and restaurant does not increase.
Under the impact of the mechanism and policies of the province together with the trend of local development, the structure of capital investment for the sectors also has a significant shift, greatly affecting the process of economic restructuring of each sector.
In the period 2006-2015, capital is a key contributor to the economic growth of the province. Given the limited capital base, economic growth is too dependent on capital, which indicates that the growth pattern is not sustainable and that adjustments need to be made to ensure the future economic development of the province. The number of sector, potential; advantages; high value
products are not much. Compared with the list of potential products of the world2, Bac Giang province has no such products. In general, the process of economic structural transformation of the province is basically in the right direction.
The economic structure is shifting positively from agriculture, forestry and aquaculture to the industry - construction and services. Within the internal structure, there is a shift towards the promotion of local advantages.
However, besides the achieved results, there are still shortcomings in the economic structural transformation of the province:
Economic structural transformation is in the right direction, but the speed is still slow.
The share of agriculture, forestry and aquaculture in GRDP remains high. The
2 34 potential economic sectors in the world, including:
Medicine; Analysis tools; Medical equipment;
Publishing and printing; Education and training;
Business, financial services; Information techology;
Electronic; Communication equipment; Embroidery items; Leather products; Footwear; Textile; Leather products; Furniture; Agriculture forestry seafood;
Wholesale and retail; Travel and services;
Entertainment; Transportation and logistics; Frame construction equipment; Construction and real estate;
Plastic; Chemistry; Oil and gas; Production and transmission of electrical energy; Automation; Engines, aviation and defense; Metal production; Mining and minerals; Production technology; Motor-driven products; Heavy industry.
internal structure of agriculture, forestry and aquaculture is slowly shifting. The internal structure of the industry shifted towards unbalanced, with a sharp increase in the processing and manufacturing industries. Service sector’s structure has almost no breakthrough.
The proportion of environmentally-friendly industries and products accounts for a small proportion and tend to decrease. Forestry contributes very little to the economy.Some sectors and products causing environmental pollution still do not have solutions to thoroughly treat such as:
raising pigs including farm and households; exploiting ores, coal, brick kilns, tunnels, metal working... etc.
Table 3. Investment capital structure of Bac Giang province according to economic activity (2006 - 2015) [3]
Economic sector 2006 2010 2015
Total investment capital (million dong) 2.789.930 9.675.636 30.467.293
Investment capital structure (%) 100 100 100
Agriculture - forestry – aquaculture 11,82 4,3 1,85
Industry – construction Industry
20,18 14,64
79,51 21,68
76,52 30,02
Service 68,0 16,19 21,63
Causes of limitations
First of all, Bac Giang suffered from drastic competition from economic centers, while not promote the potentials and advantages of the locality.
Secondly, resource mobilization is difficult.
Human resources development is confusing.
Socio-economic infrastructure is poor and lack of synchronous as well as its the ability to connect traffic with longitudinal axes and horizontal connections is not good, which lead to great limitations in economic development.
Thirdly, business management capacity is low.
The application of scientific and technical advances to production and business of enterprises is limited, leading to the weak competitiveness of products and low efficiency of production and business.
Fourthly, the business environment is not good, the procedures are unclear or cumbersome; negative in dealing with administrative procedures, especially in terms of land… etc.
Fifth, linkage does not create a shared interest, therefore lack of cohesion. The participation of the state management agencies are not active, lacks an overall strategy. The role of
enterprises has not been promoted. Exploiting the potential world market is not good...etc.
SOLUTIONS TO PROMOTE ECONOMIC STRUCTURAL TRANSFORMATION OF
BAC GIANG PROVINCE TOWARDS
INDUSTRIALIZATION AND MORDERNIZATION TO 2020 WITH A VISION TO 2030
In order to accelerate Bac Giang province’s economic structural transformation, the following specific solutions should be implemented in the coming time:
Solutions to improve the competitiveness of the economy
These are important measures to ensure the province's economic development a breakthrough in the context of international economic integration. These solutions call for the deepening of internal sector transfer in the direction of enhancing added value and sustainable development. In order to implement the solutions effectively, Bac Giang province needs to step up administrative reform, improve the business environment. Furthermore, the province should promote domestic and foreign investment and have special preferential policies to attract investors, especially multinational corporations and exporters. It is
also essential to enhance scientific research, and encourage the development of science and technology for all branches in the direction of combining modern technologies and traditional technologies on the basis of ensuring economic efficiency and product diversification.
Solutions on infrastructure and human resources development
These are basic solutions to ensure fast and sustainable development of economic sectors of the province in the future, accelerating and speeding up the process of economic structural transformation. On the basis of capital from the State budget and capital mobilized from the people, the province needs to pay attention to the planning to create a communication network linking provinces and inter - provincial areas, building electricity network, roads, telecommunications... to meet the production and circulation demand. At the same time, the province should coordinate with other departments in the training and employment. Moreover, the province need transfer agricultural labor to industry, construction and services and strengthen the coordination between enterprises and training institutions, contributing to ensuring the balance between supply and demand for human resources. Departments and agencies have specific programs to improve the human resource quality in the relationship between forecasting information and enterprises, employers - all levels of government, training facilities - workers.
Solutions on capital investment
The province should have preferential mechanisms and policies to increase the attractiveness of foreign direct investment (FDI) and official development assistance to local in order not only to generate large capital sources but also to renovate technology, develop high quality labor force and expand the market. State budget capital will be concentrated on infrastructure investment for industrial production, compensation for
ground clearance and construction of technical infrastructure. Credit capital from commercial banks and financial institutions and investors will boost production and expand investment in the industry. Furthermore, the province should actively implement priority credit programs for agriculture and rural areas as well as renovate administrative mechanisms and procedures to increase access to credit for farmers and economic partners to invest in agriculture and rural areas.
Solutions on the market
Specific measures to seek out markets for Bac Giang's economic sectors are to organize trade promotion, study market and business partners in domestic and foreign, especiallyfor the traditional products having the strength of the province. The province also need link agricultural production with processing industry, preserve and marketing products with value chains for branded products having advantages and competitiveness in the market.
Furthermore, the province could coordinate with neighboring provinces and regions to develop bilateral and multilateral cooperation programs as well as continue to implement programs with Bac Ninh province, Quang Ninh province, Hanoi capital, Thai Nguyen city to develop key products. The implementation of the cooperation program with localities is a central task in the province's external economic activities during the integration period.
Solutions for environmental protection These solutions aim to promote economic development in the direction of green growth and sustainable development, contributing to the stable and modern economic structural transformation. This direction requires the province to thoroughly grasp the industrial zones, industrial clusters, craft villages, production and business establishments applying clean technologies and equipmentto minimize pollution and treat waste according to environmental standards to respond to market requirements. The province focuses on
the formation and development of the recycling industry in the province, contributing to the saving of resources, protecting the environment and improving the health of community.
Solutions to improve the leadership and management capacity of the Party and the authorities
The province's development and economic structural transformation is closely linked to the leadership of the Party, the management of the government and the performance of local organizations, departments and sectors. In the implementation process, the province should pay attention on building the Party, which is a key task to improve the leadership capacity of the Party in implement economic structural transformation. At the same time, it is necessary to strengthen the management of the administration at all levels to meet the production and business needs and aspirations of individual and enterprises.
CONCLUSIONS
In the period of 2006 - 2015, Bac Giang province’s economic structural transformation
shifted in the right direction, but still slow, with no breakthrough. In the province’s GRDP, agriculture, forestry and aquaculture still account for a large proportion.The internal structure, agriculture – forestry - aquaculture is slowly changing, the industry - construction shifted in a disproportionate way, the service sector has almost no breakthrough. In order to create a fast and sustainable development of Bac Giang's economy in the coming time, it is necessary to well implement solutions to promote the province's economic structural transformation, especially productivity, economic efficiency and competitiveness are the top criteria.
REFERENCES
1. Bac Giang Party Excutive Committee (2005), Bac Giang-Historical paths, National Political Publishing House, Hanoi, p.14 (in Vietnamese).
2. Bac Giang Provincial Party Committee (2006), Document of the Party Congress of Bac Giang province XVI, p. 42 (Vietnamese).
3. Bac Giang Statistical Office, Statistical yearbook of Bac Giang province in 2005, 2010 and 2015, Statistical Publishing House, Hanoi (Vietnamese).
TÓM TẮT
GIẢI PHÁP THÚC ĐẨY CHUYỂN DỊCH CƠ CẤU KINH TẾ TỈNH BẮC GIANG THEO HƯỚNG CÔNG NGHIỆP HÓA, HIỆN ĐẠI HÓA ĐẾN NĂM 2020,
TẦM NHÌN 2030
Nguyễn Thị Vân1*, Nguyễn Bích Hồng2
1Trường Đại học Kỹ thuật Công nghiệp - ĐH Thái Nguyên
2Trường Đại học Kinh tế và Quản trị kinh doanh - ĐH Thái Nguyên
Chuyển dịch cơ cấu kinh tế tỉnh Bắc Giang giai đoạn 2006 - 2015 đã có những chuyển biến tích cực theo hướng hiện đại, tỷ trọng ngành công nghiệp có xu hướng tăng dần, tỷ trọng ngành nông, lâm, thủy sản có xu hướng giảm dần. Tuy nhiên, ngành dịch vụ lại có xu hướng giảm tỷ trọng và điều này phản ánh có sự ưu tiên thiên lệch của địa phương cho các nhóm ngành. Qua khảo sát và nghiên cứu thực tế ở Bắc Giang cho thấy, việc triển khai các hoạt động chuyển dịch cơ cấu kinh tế của tỉnh còn nhiều bất cập, chưa thực sự tạo ra được tốc độ chuyển dịch mạnh, hiệu quả kinh tế chưa cao. Từ đó, tác giả đề xuất một số giải pháp nhằm thúc đẩy chuyển dịch cơ cấu kinh tế tỉnh Bắc Giang đến năm 2020 và tầm nhìn đến năm 2030.
Từ khóa: kinh tế, cơ cấu kinh tế, chuyển dịch cơ cấu kinh tế, giải pháp, tỉnh Bắc Giang
Ngày nhận bài: 01/8/2017; Ngày phản biện: 11/8/2017; Ngày duyệt đăng: 28/9/2017
*Tel: 01636.477.000; Email: [email protected]