Improving business environment is Government’s priority in 2019

This has great importance because many nations are racing to attract investment through fostering the quality of their business conditions.

Resolution No 19 on the improvement of the business environment has been implemented for five years and has gained a lot of success. The Government is planning to carry a further reform on this issue next year and this resolution is expected to be numbered 02 instead of 19, just after the Resolution No 01 which sets the major tasks and solutions to implement the socio-economic development and State budget for 2019.

After five years of implementation, Resolution 19 has raised awareness of the State agencies and business community on the importance of fostering quality of the business climate and national competitiveness.

The race to improve business conditions has been accelerated among ministries in the recent years with thousands of unreasonable conditions for investment and business abolished. Many export and import goods have been removed from the list that needed specialised inspection.

The mechanism based on the principle of risk assessment and level of compliance of enterprises has been initially implemented in some areas.

As a result, the country’s business index tracked by the World Bank in 2018 jumped by 21 points compared to 2015. Performances of some criteria such as logistic services, innovation, e-Government and access to e-public services have seen strong improvements.

However, Vietnam’s overall ranking is still low compared to other nations in the region (69th/190). In addition, some indicators lagged behind, such as the bankruptcy index, dispute resolution, and property registration and business performance.

According to Nguyen Dinh Cung, Director of the Central Institute of Economic Management (CIEM), Vietnam has reformed strongly in recent years but as the world moves faster a competition is growing among nations in fostering business environment and boosting national competitiveness.

Vietnam has signed many free trade agreements (FTAs), including high-quality trade pacts such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam FTA (EVFTA). This has opened up great opportunities but also posed challenges for Vietnamese businesses.

Although the country’s business environment has improved significantly in the past five years, it is still behind others in the 11 economies in CPTPP. Therefore, competition will be harsh, according to Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI).

Experts and business community have agreed that Vietnam needs double or even triple efforts to reform in the future. The urgent need now is to get a strong engagement of ministries and localities in implementing solutions to improve business conditions.

Prime Minister Nguyen Xuan Phuc in the cabinet meeting at the end of November stressed the need for leaders of ministries and localities to set clear goals, specific criteria with strict punishments for those with poor performance to obtain obvious achievements.

In the latest draft, the targets of Resolution 02 will focus on Vietnam’s rankings in the World Bank’s Doing Business Index, Logistics Performance Index; World Economic Forum’s Global Competitiveness, the Readiness for Future of Production and Tourism Competitiveness; World Intellectual Property Organisation’s Global Innovation; and United Nations’ E-Government Index.

Priorities in 2019 will be placed on four key areas, including simplifying procedures for doing business; continuing reforms in specialised inspections and connecting the National Single Window Portal; promoting electronic payment and providing e-public services at the level 4; and developing innovation ecosystems and supporting startups.

According to the draft, Vietnam is targeting to be among ASEAN 4 with the best business environment by 2021.

In the latest announcement of the Government Office last week, Deputy Prime Minister Vu Duc Dam also asked ministries and agencies to urgently contribute opinions for Resolution 02.