Monthly Archives: June 2015

A view from Vietnam on managing resources and economic growth

Last week I represented the UK at a meeting of the Steering Group of the International Resource Panel  (IRP) in Hanoi. I wanted to share a few reflections, first about Vietnam itself and secondly about the meeting.

The Vietnam characterised by the horrors of the cold-war conflict which dominated the international news in my teenage years is now a very different country. Hanoi is now a major Asian city of around seven million people just a little smaller than London. In fact, the population of Vietnam has roughly doubled since the 1970s. Like its bigger neighbour China, its economic growth rate was a phenomenal six to eight per cent up to 2009 and five per cent since then. It is developing fast.

The English language newspapers here reflect a very different cultural approach to news from the UK.  Food stories dominated the front pages in the days I was there including an article questioning activists’ concerns about GM technologies.

Another complained about the poor return on investments in research to improve the efficiency of Vietnam’s fishing and aquaculture industry. This industry’s turnover has grown from $500 million (about the size of the UK fishing industry) to an astonishing $8 billion in the past 20 years, but it is still composed of about 130,000 individual fishing boats. Clearly Vietnam is driving itself hard.

Another story looked at claiming regional branding and protected name status for Vietnamese rice. If this sounds familiar it’s because in the UK we are promoting exactly the same issue for our own food products to boost our competitive advantage in international markets. The phenomenal rate of growing prosperity in Vietnam offers the opportunity of better living standards for its people, but behind this economic success story is a darker message for us all.

A major activity of the IRP meeting here has been to understand the stocks and flows associated with global resources – everything from metals and water to fish protein and soy. This work has resulted in some remarkable statistics about the rate at which we, the international community, are using up the resources of the planet. For example, from 2011 to 2013 China used more cement than the United States did in the whole of the 20th Century.

By 2050, 30-75% of global energy will be absorbed just mining the primary metals needed (iron, copper, nickel, cobalt etc) because the easy stuff has already been mined. Assuming all other things are equal, if everybody on the planet was to be as wealthy as the average American then the world would need five times the current planetary resources to sustain the population.

These are interesting and sobering statistics. This is a global challenge on a massive scale and the challenge for the IRP is to find out what a solution to this might look like. Optimists often draw attention to our capacity to innovate our way out of these problems, but the pessimists will then say that there is little evidence that these kinds of technical changes actually arrest the demand for primary resources like water, minerals and basic foods.

The IRP can only try to set out solutions. In broad terms these concern finding ways of using resources more sparingly, and also by applying the ‘5 Rs’ to current use of resources: Repair, Re-use, Refurbish, Re-manufacture and Regulate. Implementation of all these measures, plus various forms of technology innovation, may have the capacity to solve this global problem.

Although the IRP will provide reports to the G7 and other influential decision-making bodies, messages that have important implications for the way that societies function, and especially for potential economic growth, can land badly with both people and policy makers.

But there is a bright side to this message. If Vietnam can change so radically in so short a period of time, then there is hope the rest of the world can too.