Vietnam cuts 20% of government workforce

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Government Cuts

Vietnam is undergoing a major overhaul of its government, with plans to slash the size of ministries, government agencies, and the civil service workforce by roughly 20%. The Communist Party, led by chief To Lam, is pushing for this streamlining ahead of next year’s leadership reshuffle at the National Party Congress. The reforms include the abolishment of five ministries, the merger of others like finance and planning and investment, and the elimination of four government agencies.

Several state-run media outlets will also be scrapped, with at least sixteen state-run television channels already ceasing broadcasting as of January 15. The government overhaul is being pitched as essential to remedy a bloated bureaucracy, reduce red tape, and cut unnecessary costs. However, it will also dramatically curb outlets for information in the nation’s state-controlled media landscape.

Businesses cautiously welcome the long-overdue reforms but worry about potential policy decision delays and months-long logjams. The restructuring process may cause things to slow down initially, but it is expected to ease the cost burden on the state budget and boost the efficiency of the state apparatus. The ministries set to stay include defense, public security, justice, foreign affairs, and industry and trade.

Government streamlining ahead of reshuffle

The Government Office, Government Inspectorate, and State Bank of Vietnam will also remain intact, albeit subject to internal streamlining. The belt-tightening comes alongside a worsening global backdrop, with Vietnam relying heavily on foreign investment to fuel export-driven growth.

The bureaucratic shakeup follows the Party’s years-long corruption crackdown that has led to high-profile political resignations and arrests. Streamlining the apparatus poses challenges, particularly in supporting redundant officers and retaining talent. The process must be carried out based on optimal principles to avoid inequality, dissent, and social conflict.

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The state needs to provide support to help redundant officers adapt to new circumstances and find new jobs. Retaining talented and capable cadres is crucial to ensure the apparatus runs smoothly. The streamlining must be conducted transparently, fairly, and democratically to encourage unsuitable officers to leave and retain capable individuals.

The goal of streamlining is not merely to cut the number of cadres but to enhance the quality of the workforce. A timeline and method are required to ensure democratic and harmonious implementation, fostering social stability and preventing discontent among those who have to leave.

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