Making cities thrive
by Albert K. Ting, Chairman at CX Technology Corporation in Taiwan, presented his plan for Ho Chi Minh City at the Global Economic Symposium 2014 (GES) in Kuala Lumpur.
The population in cities is expected to have nearly doubled by 2050. Small cities will become large cities. This also happened to Ho Chi Minh City, Vietnam, and it is an outstanding example of how growing cities can be developed sustainably. Here is a three-step strategy:
1. Kick-start job creation
The planners of Ho Chi Minh City introduced an export-oriented free trade zone, which helped to attract more than 150 manufacturing firms, generating 65,000 jobs. Starting with labour-intensive production, the zone has successfully transitioned into the production of more skill-intensive goods.
2. Provide infrastructure
Along with the establishment of an export-oriented free trade zone, infrastructure investments need to keep pace with the evolving needs of industry. In Vietnam, energy supply was ensured by investing into a foreign-owned power company.
3. Develop schools – develop human capital
Skill-intensive production requires a skilled workforce. Hence, investments into education will have to complement the other steps. In Ho Chi Minh City, two schools were initially build up; one for Vietnamese nationals, and one for expatriates. Soon, other countries set up consulate schools, leading to a vibrant learning environment.
Combining these three steps helped to put growing Ho Chi Minh City onto the right track. Will it work elsewhere? The exact same model may be problematic in more remote locations because geography matters a lot for participation in global value chains. Yet, this well-developed plan is adaptable.