Vietnam Competitiveness Report
National Competitiveness: Issues for Vietnam
Meeting with Prime Minister Phan Van Khai and his delegation
Professor Michael E. Porter Institute for Strategy and Competitiveness Harvard Business School Cambridge, Massachusetts June 24, 2005
This presentation draws on Michael Porter, Klaus Schwab: The Global Competitiveness Report 2004-2005, Oxford University Press, 2004 and other sources. For further information on the Report and on the Institute for Strategy and Competitiveness see www.isc.hbs.edu
200506 GCR Vietnam – KC 2005.06.24.ppt
1
Copyright 2005 © Professor Michael E. Porter
Topics for Discussion
• • • •
National competitiveness: essential concepts Competitive assessment of Vietnam Key issues for Vietnamese policy Profile of the Institute for Strategy and Competitiveness
200506 GCR Vietnam – KC 2005.06.24.ppt
2
Copyright 2005 © Professor Michael E. Porter
What is Competitiveness?
• Competitiveness is determined by the productivity (value per unit of input) with which a nation, region, or cluster uses its human, capital, and natural resources. Productivity sets a nation’s or region’s standard of living (wages, returns on capital, returns on natural resources) – Productivity depends both on the value of products and services (e.g. uniqueness, quality) as well as the efficiency with which they are produced. – It is not what industries a nation or region competes in that matters for prosperity, but how firms compete in those industries – Productivity in a nation or region is a reflection of what both domestic and foreign firms choose to do in that location. The location of ownership is secondary for national prosperity. – The productivity of “local” industries is of fundamental importance to competitiveness, not just that of traded industries – Devaluation and revaluation do not make a country more or less “competitive”
• •
Nations or regions compete in offering the most productive environment for business The public
Meeting with Prime Minister Phan Van Khai and his delegation
Professor Michael E. Porter Institute for Strategy and Competitiveness Harvard Business School Cambridge, Massachusetts June 24, 2005
This presentation draws on Michael Porter, Klaus Schwab: The Global Competitiveness Report 2004-2005, Oxford University Press, 2004 and other sources. For further information on the Report and on the Institute for Strategy and Competitiveness see www.isc.hbs.edu
200506 GCR Vietnam – KC 2005.06.24.ppt
1
Copyright 2005 © Professor Michael E. Porter
Topics for Discussion
• • • •
National competitiveness: essential concepts Competitive assessment of Vietnam Key issues for Vietnamese policy Profile of the Institute for Strategy and Competitiveness
200506 GCR Vietnam – KC 2005.06.24.ppt
2
Copyright 2005 © Professor Michael E. Porter
What is Competitiveness?
• Competitiveness is determined by the productivity (value per unit of input) with which a nation, region, or cluster uses its human, capital, and natural resources. Productivity sets a nation’s or region’s standard of living (wages, returns on capital, returns on natural resources) – Productivity depends both on the value of products and services (e.g. uniqueness, quality) as well as the efficiency with which they are produced. – It is not what industries a nation or region competes in that matters for prosperity, but how firms compete in those industries – Productivity in a nation or region is a reflection of what both domestic and foreign firms choose to do in that location. The location of ownership is secondary for national prosperity. – The productivity of “local” industries is of fundamental importance to competitiveness, not just that of traded industries – Devaluation and revaluation do not make a country more or less “competitive”
• •
Nations or regions compete in offering the most productive environment for business The public