Seminar to present World Development Report 2024: The Middle-Income Trap

The chairpersons of the seminar

The seminar was co-chaired by Assoc. Prof. Dr. Hoang Van Nghia, General Director of the Department of International Cooperation; Assoc. Prof. Dr. Bui Van Huyen, Director of the Institute of Economics; and Mariam J. Sherman, World Bank Director for Vietnam, Cambodia and Laos.

Sharing about the report, Somik Lall, Senior Advisor to the Chief Economist of the World Bank Group said since 1990, only 34 economies have successfully transitioned from middle- to high-income status, while up to 108 countries have failed to do so.

In its report, the World Bank gives a three-stage formula for all countries known as the “3-i” strategy. In the first stage, countries aiming to reach middle income status need to attract investment, especially foreign direct investment. The second stage requires “2-i”, which are continuing to attract investment and absorb technologies. In the third stage, after passing the upper middle income status, countries must embrace all “3-i”, countries need to start focusing on researching new technologies that lead the world and technological innovation.

Scene from the seminar

At the seminar, experts and scientists listened to Sebastian Eckardt, the World Bank’s Practice Manager for Macroeconomics, Trade and Investment in the East Asia and Pacific Region, as he shared about development and reform issues taking place globally and in Vietnam. Based on his presentation, the two sides discussed and analyzed the issues that middle-income countries are facing such as slowing growth, structural stagnation, and narrowing policy space.

Representatives and scientists also spent a lot of time discussing the internal situation of Vietnam’s economy after 40 years of renovation; lessons learned from success and failure in overcoming the middle-income trap, drawing on two typical case studies: South Korea and Brazil. Many participants said that Vietnam has achieved outstanding achievements in socio-economic development, transformed from a poor country to a middle-income country and become one of the most open economies in the world; however, Vietnam still faces numerous challenges.

To achieve rapid growth and overcome the middle-income trap, participants provided recommendations and suggestions for Vietnam, focusing on three key areas: a transformation in mindset, policy reform, and improved data systems.