HANOI (Reuters) - A third of the ruling Communist Party’s 15-man Politburo in Vietnam stepped down at a five-yearly congress on Tuesday, part of a reshuffle that will bring new, younger faces into the ageing leadership.
At the first meeting of a newly elected Central Committee, Nguyen Phu Trong, an ideologue who heads parliament, was elected to the party’s top post, general secretary, a source with knowledge of the vote said on condition of anonymity.
Prime Minister Nguyen Tan Dung was also re-elected to the Politburo, the source said, in a sign he is likely to have a second term as Vietnam grapples with volatile inflation, a depreciating currency and declining foreign exchange reserves.
The changes to the elite Politburo, to be officially announced on Wednesday, are unlikely to bring imminent or bold policy shifts, although policymakers say they see the need for more economic stability after years of rapid growth.
Prime Minister Dung is a known quantity among investors, but Jacob Ramsay, who follows Vietnam for consultancy Control Risks, said there was an urgent need to adjust economic policies.
“A continuation of current policies could lead Vietnam’s economy to a brick wall at some point,” he said. <
Party heavyweight Truong Tan Sang and deputy prime minister Nguyen Sinh Hung, also in the Politburo, are likely to receive top jobs, with Sang possibly becoming state president and Hung becoming speaker of parliament.
Both are said to be rivals of Dung’s and such an arrangement would amount to “checks and balances, Vietnamese-style,” said a Western diplomat who declined to be identified so he could speak candidly about Vietnam’s sensitive Politburo structure.
A deputy central bank governor, who banking sources say may take over as governor, was also promoted.
As congress meets in the chilly capital, Hanoi, whose streets are festooned with red-and-yellow banners and propaganda posters, its leaders are under pressure to revitalise the party and keep it relevant in the fast-changing country.
Dung was heavily criticised last year for perceived mismanagement of the economy and for his role in the near-collapse of Vinashin, a state shipbuilding conglomerate that was sinking under 2.7 billion pounds in debt despite receiving extraordinary state support over the years.
Among big winners of the Central Committee election were Vietnam’s 63 provinces, which increased their representation to 75 members from 53. Rural wages have failed to keep pace with urban incomes, leaving many provinces struggling economically.
“Having so many members from the provinces is going tome they will try to ensure that economic benefits are equally distributed, which could stymie good economic policymaking,”said another foreign diplomat who watches Vietnam closely.
The election of deputy central bank governor Nguyen Van Binh to the Central Committee puts him in line to take over as governor after elections scheduled for May, according to a source close to the central bank.
With its leadership dominated by greying bureaucrats, the party faces a challenge in attracting a younger generation better versed in music videos than the revolutionary rhetoric of party founder Ho Chi Minh.
Sixty percent of Vietnam’s 90 million people are under the age of 35. Many see their path to prosperity tied closely to the private sector, with little need to join the party.
Emerging from the fallout of decades of war and central planning, Vietnam’s economy has more than tripled from 18 billion pounds a decade ago. Per capita wealth has also nearly tripled to 749.44 pounds a year.
But many problems remain. While low valuations, increased global liquidity and the government’s renewed interest in macroeconomic stability could support share prices this year, foreign interest may remain limited without improvements, such as better corporate governance and transparency.
Editing by Jason Szep