In this opening speech, Deputy Prime Minister Vu Khoan emphasized some features of the 2006-2010 plan:

-Vietnam's socio-economic development plan for the 2006-2010 has been opened widely to discussion and inputs. Consultations have taken place not only with ministries, agencies, localities, and socio-political organizations, but also with local and foreign scientists and businesses, non-governmental organizations, overseas Vietnamese and diplomatic corps.

-The 2006-2010 plan will mark a turning point in terms of the quality of socio-economic development. If in 1995 Vietnam had declared it had resolved the socio-economic crisis, then in the next five years Vietnam will have to strive to escape the under-development status by increasing its GDP per capita from a current 640 USD to an over 1000 USD by 2010, concurrently establishing fundamental markets and fully integrating into the world economy through its accession to WTO.

-In the next five years, besides the need for rapid development, more attention will be paid to sustainable development and increased quality and efficiency of growth. The next 5 year plan will not only target an average growth rate of 7.5%-8.0% but also establish a set of orientations for major social issues in terms of quality and efficacy, most importantly poverty reduction according to new line, higher quality of education and health care and environment protection.

-To achieve the targets, Vietnam needs around 140 billion USD in total investment capital (according to the 2005 prices). The most important resource as assessed by the Government will continue to come from domestic channels. The ratio of investment against GDP is estimated to jump from 37.5% in the past 5 years to around 40% in the next 5 years, and investment capital from the people and the private sector will increase from the current level of 27% to 34%. A new channel of fundraising will be the equitisation of State-owned enterprises and the issuance of sovereign, project and corporate bonds. Vietnam also attaches great importance to foreign capital sources. Vietnam will strive to increase the proportion of foreign capital against total investment from a 30% in the past 5 years to a 33% in the next 5 years. Besides ODA and FDI, Vietnam has opened two new channels for fund-raising from abroad, namely portfolio investment and sovereign bond sold on international markets.

With respect to ODA, Vietnam plans to achieve 11 billion USD in aid within 5 years including the amount of committed but not disbursed ODA. The utilisation of this capital will prioritise completion and development socio-economic infrastructure; addressing social, health, environment and education issues; finalising policies and dealing with post-WTO accession problems.

In his welcome speech, MPI Minister Vo Hong Phuc affirmed that: CG 2005-the 13^th meeting-takes place at a special juncture. Vietnam has successfully implemented the 2001-2005 development plan, marking an era of close and fruitful cooperation between Vietnam and the international donor community and opening a new period in which Vietnam needs to make greater efforts and continues to be strongly supported by the international donor community in its comprehensive reform to soon bring the country out of the under-development status.

An MPI report affirmed that the Vietnamese economy has recorded sound and relatively comprehensive achievements. The economy grew considerably at the annual average rate of 7.5% for GDP in consecutive years. In 2005 in particular, GDP has grown by 8.4% as compared to 2004, the highest ever in the past 9 years. Per capital GDP has reached 640 USD. Economic structure shift has seen positive progress towards industrialisation and modernisation. Agricultural production value out of the total GDP has reduced to 20.7%, industrial increased to 41%. Besides, Vietnam has also recorded a lot of achievements in social field. Poverty incidence has fallen from 17.5% in 2001 to less than 7% in 2005.

Apart from the achievements, Vietnam is facing numerous difficulties and challenges such as economic growth rate not in commensurate with development potential, low quality of development and low economic competitiveness. Economic structure shift is still slow and has not fully utilized comparative edges in each industry, region and product. Some major balances such as budget and trade remain not stable. International integration is not carried out pro-actively. Some social issues have not been addressed.

On the threshold of the Meeting, World Bank-one of leading donors to Vietnam-released the 2006 Vietnam Development Report. In the report, WB appreciated Vietnam's 2005 economic growth rate. In the first 10 months, the rate reached 8.1%. Apart from economic development records, poverty incidence continued to reduce; the service sector gained robust growth, tourism saw positive growth, investment was on the rise (the ratio of investment against GDP might reach 38.2%, FDI disbursement would increase as compared to last year, trade deficit reduced).

Dr. Michael Kein-Vice Chairman in charge of Private sector development of World Bank and economic expert of the International Finance Corporation underlined that: in 2005, Vietnam's doing business environment records outstanding progress thanks to legal reforms namely in business registration, property registration, investor protection and forced contract observance. According to Dr. Kein, in the Vietnam 2006 Doing Business Report, Vietnam ranked 3 in the leading reforming countries.

WB Country Director Klaus Roland stated that pledged disbursement in numerous ODA projects in Vietnam have been made such as road, hospital, school and welfare establishment construction projects, however the pace is still slower than in other receipt countries. It is in this field that donors would like Vietnam to further improve.

According to WB Chief Economist Martin Rama, medium-sized enterprises have to grow stronger in the coming time; 3 major sectors in need of intensive reforms are banking and finance, land market, labor market and infrastructure services.

According UNDP Resident Coordinator in Vietnam Jordan Ryan, Vietnam is completely well-positioned and has capacity to achieve its social targets in the coming years…He also emphasized that the greater attention needs to be paid to ensuring the quality of growth, sustainable development and higher competitiveness of the economy in the integration process.

Closing the 2005 CG Meeting, the participants emphasized the importance of completing key reforms of the Finance and Banking sector and State-owned Enterprises (SOEs) for Vietnam to reach its full potential and continue to reduce poverty at a rapid pace. Delegates agreed that efforts should be continued to apply the consultative and outcome-focused approach of the Comprehensive Poverty Reduction and Growth Strategy (CPRGS) in preparing and implementing the new

Socio-Economic Development Plan (SEDP) 2006-2010 and to fully reflect the

principles of the Hanoi Core Statement in ODA effectiveness and government programs. In support of this commitment, donors pledged US$ 3.7 billion in assistance for the coming year, compared to 3.4 billion USD pledged by 34 bilateral and multilateral donors in the 2004 CG.