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Vietnam minister says party must reform, or face opportunity loss

HANOI (Reuters) - Vietnam must urgently reform its political system to continue its economic growth and liberalisation and bolster the private sector to win back public trust in the ruling party, the country’s investment minister said on Friday.

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Bui Quang Vinh said the past three years had seen “life-changing” moves away from central planning towards a market economy, but Vietnam needed effective leadership and a party that was more efficient and supportive of private firms.

Vinh referred several times to “Doi Moi”, or “renovation”, the term used in Vietnam to describe the opening up of its economy in the 1980s.

“Over the past five years, we have actively renovated our economic institutions and have achieved certain fruitful and positive results, but renovation in politics has barely been done,” Vinh told the Communist Party’s five-yearly congress.

“This is a prerequisite and the most important factor for the next renovation period. Doing this well, the party will regain trust of the people by setting itself as a renovating example and by effective leadership.”

His comments come after a year that saw record foreign investment and mergers and acquisitions, and economic growth of 6.7 percent, the fastest in five years, helped by new legislation geared towards attracting firms that include Panasonic, Toshiba and Samsung, which has at least $12 billion pledged in Vietnam.

The tone of the speech by Vinh, who is expected to retire soon, differed from that on Thursday of party chief Nguyen Phu Trong, who gave a more modest recap of the economy but also called for a strong reform push.

Trong is among nominations endorsed by the outgoing central committee for key leadership posts to be decided during the congress, according to several party sources, who said Prime Minister Nguyen Tan Dung had been omitted.

Some experts believe Dung’s surprise exclusion may not completely rule him out of leadership of the secretive party.

Dung has been widely credited with steering reforms of late, including Vietnam’s pursuit of free trade deals with its biggest markets through pacts with the European Union, top investor South Korea and the U.S.-led Trans-Pacific Partnership.

Vinh said Vietnam’s focus should be strengthening private domestic firms to integrate into the global economy.

“To achieve our desire of heading to a prosperous, creative, fair and democratic Vietnam, our only choice is to reform,” he said.

“We have to focus highly on boosting growth of domestic businesses, and mostly private Vietnamese companies... the health of domestic companies is the health of the economy.”

Reporting by Martin Petty; Additional reporting by Mai Nguyen