Essential Action   >Structural Adjustment and Labor

Vietnam

Vietnam Interim Poverty Reduction Strategy Paper, March 14, 2001

III. Macro Mechanisms and Policies to Promote Economic Growth and Create Resources for Poverty Alleviation

Promulgate the decree on gradual transformation of state-owned enterprises (including enterprises founded by socio-political organisations) into sole-proprietor limited liability companies operating under the Enterprise Law.

Adopt policies to assist workers who are made redundant in the course of SOE reorganisation and transformation of ownership in accordance with the current regime; study and apply mechanisms to encourage workers to leave their jobs voluntarily by providing them with appropriate compensation, and mechanisms to deal with debts owed by enterprises whose form of ownership is transformed during the process of SOE reform.

Memorandum of Economic and Financial Policies, and Technical Memorandum of Understanding, March 22, 2001

Ensuring funding for critical areas, while keeping expenditure restrained overall. Spending will be redirected toward key social services, especially for primary education and basic health services, and for vital social and economic infrastructure (in particular for rural development) in support of poverty reduction. To ensure funding for such spending, the 16 percent increase in government wages this year is being accompanied by a cut in administrative staff so as to contain the growth in the wage bill in the coming years, and by economies in spending as necessary. Subsidies to SOEs will be avoided.