What reform needs now is...psychology
One of my colleagues, Alejandro Alvarez de la Campa, joined me on a recent trip to Vietnam. (See my Hanoi blog posts: 1, 2, 3.) He came away with a different take on business environment reforms - the psychological dimension. Alejandro's words and photos follow:
Vietnam is an example of how countries should approach the future. Forgetting about history (at least about the bad things in history) and thinking forward. I asked a Vietnamese friend and colleague what young people in her country think about the past, and what are their hopes and aspirations for the future. She said, "We don't care about the past, we just want to become rich. We will work hard to achieve this and we will change our mentality, if necessary, to achieve it." This is a pretty important statement considering that around 65% of the population in Vietnam is under 30 years of age. I could see that statistic clearly - walking through the streets of Hanoi gives you a sense of how vibrant and dynamic this country is.
As Christine posted earlier, a group of World Bank Group staff and other donors gathered in Hanoi recently to discuss the latest trends in business environment reform around the globe. Many important reforms are taking place in different countries. We are slowly getting there - in terms of knowing what works and what does not. We could be better at sharing this information among ourselves and with the rest of the world, although we are improving in this as well. So what is it that makes our work so frustrating at times? Why are we achieving different results in different countries, despite using similarly skilled people and the same best practices and techniques?
At the end of the day, it is the mentality of our government clients that matter. It is their willingness to reform and their interest in facilitating private sector development that make the difference. We just give them the tools. We have to put more emphasis on why they should change their mentality and adopt the "Vietnam approach". But we are not psychologists - we are economists, lawyers, bankers, investors, bureaucrats, you name it, but not psychologists.
The Doing Business report is achieving a lot of success in this psychological dimension. Reminding someone every year that they are worse than their neighbors has to impact their thinking. We are right to improve the business environment – my Vietnamese friend would agree that a better business environment means that more people can become richer. But we need to go further and address the psychological dimension of reform as well.
Comments (2)
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I agree with Alejandro about Vietnam. Vietnamese enthusiasm for the future is contagious. It's impossible to be among a group of young Vietnamese and not get excited about a new venture, a film or a boxing match. The place just puts you in the mood.
I doubt, though, that the country's young demographic is the real force behind ingrained Vietnamese attitudes of entrepreneurial success. In fact, youth may be overrated as a measure of economic resilience in the face of obstacles.
Iran is another country with a troubled past, a contentious relationship with the west, and a young and dynamic population. Yet the attitude among young Iranians is nihilistic. They seem to say "I don't care about the past or the future. I live in the present and I live for myself. The Islamic Revolution was a fraud but I don't want anyone's help in replacing the status quo. To each his own."
If you talk to young Iranians (I have) you might hear the "Me" refrain of 1980's Americans. I think Iranians are complascent because their country is resource-rich and is relatively wealthy compared to Vietnam. Relative poverty rather than a young demographic was Vietnam's real ticket to success. Temporary want is a good motivator.
To paraphrase Howard Cossell, Muhammad Ali fought his best fights when he was hungry, not when he was young. The meek do knock out George Foreman and inherit the earth, as has Vietnam.
Posted by: Hasan Jafri | Jan 10, 2007 4:34:11 AM
I have not been to Vietnam , but will soon. You are truly correct on transformation of economy through psychology.
Lets do a flip flop. As much as humility and willingness to forget the past and pursue on towards the future with determination ; arrogance and pride comes of a past glory comes before a fall too.
All the psychology of the people of the nation becomes inevitably in its tapestry as invisible hands a culture.
Adam Smith talks about capitalism on the invisible hands that suppose to work on the best of human in their mind and potential. Market forces dictates that what I deem good I reward you. Thus, theinvisible hands that move the market.We rewards each other - the invisible hands.
Unless the market is blind and reward even what is not in universal principles of reasonable person and potential of mankind to its contribution to the market.
Market psychology is important . To come out from the past is akin to a caterpillar forgetting its shedding and forgotten its once a caterpillar.
One needs to seek to look beyond what is inside the country and claim- "I wish to be among the players and not hidden . I walk in this global arena as a people who shall not put my heads down nor put my head up with arrogance that we have arrived...".
Thus, ironically , some rested on their laurels while some decided its time to get up even with much setbacks. If this is the view of the Vietnamese younger generation , I salute them . The older generation should give themselves a pat on theirback for the mentality of the youngs much stems from the remnants of the old.
For a nation that does not has reputation of an international language at their advantage( eg English or Mandarin )( forgive me if I may be ignorant I am talking about majority)..I must say its good sign to hear this from their young generation.They are not even thinking of limitations but thinking of forging and hope and making history themselves.
Irony , when most nations complaint of their younger generations; you have at this corner of the earth - a younger generation with aspiration , fortitude and wisdom to brave even knowing their limitations.
The beginning of coming out of poverty is to resolute to start coming out from the caterpillar zone. To know even what is ahead of them though with limitations - has the spirit of change for progress.
This must be indeed an interesting insight to me - a nation to watch closely.
The composition of a nation younger generation is often to me the direction of the nations. The pscychology of their people is the culture of their people , and the culture dictates thier practices and beliefs . Towards excellence starts from pscyhology.
Where a culture attack those who work towards excelllence and work towards agaisnt what set a nation back - thus its the beginning of a downfall - ignorance to the potential of man and its nations.
We just have two choices - let the destruction continue or to build or construct. They chosen to construct. Burma has good young generations too as I noticed when they work in another country.Its sad the Burmese governtment is not awaken as their fellow Vietnamese. Forever the militarians look from afar the coutnries in ASEAN that has changes while Burma is always in ..... Nobel Prize writer , on the theory of sum of total parts become a bigger whole is so simple -I do hope they see it at least for their young or future generations.
Discipline humble Burmese working in another person land , also polite. They could have served well in their country.
For the ASEAN chapter think Burma should really think where they are amongst the developing countries. I am not political but I just feel restless to see potential not tapped .
Wisdom Poi
Good article to note to many .
Posted by: Wisdom | Jan 25, 2007 5:09:25 AM