Professor Trẩn Đình Thiên, former director of the Central Institute for Economic Management, talks to Thanh Niên (Young People) newspaper about the role transparency could play in the country’s unobserved economy.

What should Việt Nam do to observe and calculate the amount of corrupt assets in the unobserved economy?

First of all, there is a need for Việt Nam to observe its informal economic performance. We’ll face big challenges as it is not easy, particularly with corruption cases. However, corruption is one cause leading to smuggling, drug addiction and prostitution. These issues have caused big losses to our national economy. As a result, it is imperative for us to develop open and transparent institutions. With such institutions in place, I’m sure that we’ll be able to bring the ‘dark side’ of society to light. With a society operated on the principles of transparency and accountability, I’m confident that there will be no place for the ‘ask and give’ mechanism. As a consequence, acts of corruption will be reduced.

How should Việt Nam start to control the unobserved economy?

We all agree that if we want to be able to control the unobserved economy, the first thing we should do is to hold high the principles of transparency and accountability. At the same time, we have to streamline the current State apparatus. Of course, to do this we need to develop a set of working tools. At the same time, we also need to make a proper assessment of the current national economy before starting to develop a plan for the country’s future economic development. Last but not least, the capacity of the people who are carrying out the programmes is a very important element that we can’t forget. But to perform their assignment well, these people need good policies and programmes.

How should we ensure this plan is a success?

Gambling and betting activities should be legalised in Việt Nam. To do that we need a clear set of tools for such activities. So far we have lost quite a lot of money on gambling and betting activities. It is the task of the State management agencies to be able to monitor illegal acts of money laundering or corruption through gambling or betting activities.

The Government should also encourage big household businesses to become enterprises. And as a result, Việt Nam will have a higher number of strong private entrepreneurs.

What’s the most important part of having the full picture of the unobserved economy?

Statistics may not only help raising budget collection for the national economy. They will help the national economy operate in a more transparent manner with fewer corruption cases while the citizens’ rights will be ensured.

To encourage organisations and people who are engaged in the informal economy to switch to the registered or official economy, the Government should focus on long term measures while developing a more institutional transparency through the operation of e-Government and non-cash transactions. This is a way to prevent tax fraud and help management agencies perform their duties more efficiently and effectively. — VNS