Looking at the actions of the Government will see the image of the enterprises

Wed, 06 Sep 2017 09:47:54 AM GMT + 7    Print   Email   Share:

According to Mr. Vu Tien Loc, the president of the Vietnam Chamber of Commerce and Industry (VCCI), the position of the private sector has never been so prominent in the Vietnamese economy as present.

However, the strength of the private sector that is being seen as an important driving force of the economy is looking at the drastic action taken by the government to create and accompany with the enterprises.

 "Heat" of the leader

Sir, the enterprises community has never mentioned much to the government as it is today. It means they are expecting a lot of commitment to the action for the development of people and enterprises that the Government’s Prime Minister has set forth and resolutely implemented since taking his position. In fact, what are they feeling about tectonic Government, Sir?

- Dr. Vu Tien LocEnterprises are still watching the heat in the reform determination of the Government’s Prime Minister. This heat has been maintained since the first meeting of the Government’s Prime Minister with the enterprises  community and businessman in April 2017 until the present. This heat that has spread to the business community, creat excitement and confidence in the operation of the new government.

At the Government’s Prime Minister's Conference with enterprises in May 2017 recently, this heat has been pushed up with the commitments and actions of the head of Government.

People remember that at the conference, after listening the report of the VCCI about the burden of expenses that Vietnamese enterprises are suffering is much higher than other countries in ASEAN region. The Government’s Prime Minister, Mr. Nguyen Xuan Phuc determined that the year of 2017 was the cost reduction year for enterprises and the first action also began with the Prime Minister, when he signed Directive 20 on the avoidance of overlapping checks and inspections between interdisciplinary inspectorates at the conference.

It can be said that after reviewing the entire regulatory system and issuing 50 decrees of business conditions in 2016, the commitment of the Government’s Prime Minister on reducing costs for enterprises in 2017 has created a very new image of government that creates and acts for the development of people and enterprises.

Newest, at the end of August, the Government also requested a comprehensive reform of the management of import and export goods as a key task in the direction and administration of ministries, sectors that should be implemented seriously and changed from 2017.

It may be necessary to recall the statistics of the Central Institute for Economic Management (CIEM) about the total one year cost of professional inspections that enterprises are required to pay to comply with relevant regulations in order to see the full meaning of the above request. This cost reaches to VND 14.3 trillion and 28.6 million working days.

The confidence of investors and enterprises is aroused and motivated by such actions.

In this trend, Is the growth of the private sector inevitable, Sir?

Dr. Vu Tien LocThere are not any barriers to the development of the private sector, especially in thinking. Resolution 10-NQ / TW on private sector development has become an important driving force of the socialist-oriented market economy.

There are many jargons that are first time linked to the private sector, such as the identification of the State economy, the collective economy and the private sector as the core for the development of an independent and autonomous economy. In particular, the Resolution stated clearly removing all barriers, prejudices and creating favorable conditions for the development of a healthy and well-oriented private economy…

The breakthrough in thinking and perspective with the private sector are very clear. These have a positive impact on the Government to build, act and create a firm foundation for the Government’s Prime Minister in raising the flag of reform, drastically improving the investment and business environment, institutional reform to service for the healthy development of the private sector.

In particular, the slack of the State in business activities is very strong. In the past two months, the Government has signed a promulgation of lists of state-owned enterprises that need to withdraw capital from ministries, sectors, localities and even State Capital Investment Corporation. The list includes not only names, ages, but also a clearly defined the  exit schedule and the ratio of state capital to be withdrawn.

Thus, together with the list of equitized SOEs for the stage of 2017-2020 classified by year, the first publication of the above lists delivers a very strong message from the Government. That is, the State shall not take part in sectors and fields that the private enterprises are able to do. Not only that, a comprehensive strategy for restructuring state assets is also coming to light, enabling private sector’s investors to have long-term and well-established investment strategies.

I would like to reiterate the statement of the Prime Minister during his working session with the Ministry of Industry and Trade on the restructuring of state-owned enterprises under the Ministry of Industry and Trade. It is that the State shall not go to sell beer and milk.

Not only in the fields of production and business, the State is also away gradually from public services and even with the construction and operation of public administrative centers. The public administration center in Quang Ninh is an example.

Business opportunities are expanding to the private sector following the steps back of the State and the perfection of the mechanism and policies. The foundation for a strong, stable private sector in Vietnam is being created ... But, ther are still a lot of work to do.

The "knot" of business conditions

You mentioned that there are a lot of work to do, so what kind of work, are still the problems in implementation at the grassroots level as you said, Sir?

- Dr. Vu Tien Loc: I used to say, if you would like to know how an enterprise work, look at the actions of each local official. The gap between regulations and enforcement still exists, prevent the effectiveness of good policies, but, this's not a big knot that needs to be unplugged first.

To try to look back at the story of specialized inspection. VND Billions and millions of people’s working days that enterprises and enforcement agencies have been spent to comply with the regulations on specialized inspection, but the effectiveness of State management is not clear.

For example, the inspection of formaldehyde in imported fabrics that have been taken place over several years, applied to 100% of imported consignments, with a myriad of procedures, but the detection rate is just counted on the fingerprint. Enterprises recommended to remove because of wastes and not effectiveness, but there has been lost several years to success in pursuance of the ministry of Trade and Industry to cancel this request.

Many unreasonable,  unnecessary procedures and the importance is that not  effective procedures in the State management as above are still exist, enterprises also recommended to remove but they have not been accepted yet.

I would like to reiterate the question of a representative of a specialized management department, when he listened the VCCI's recommendation to give up the eligibility statement instead of the state management agencies announce the conditions as the basis for the implementation by enterprises themselves,, the inspection turns to post-inspection. He wondered, if not being stamped, what do the state management agencies check with?

Obviously, The knots that need to remove not only be the level of enforcement, but they are also in the ministries and sectors, because the state management’s thinking does not keep pace with the new private sector's perception,  still doubts enterprises and considers the state management’s tools are still the license, the mechanism of asking and giving.

As a consequence, after the victory with the sibling license by the end of 2016, there are almost no ministries or sectors that have complied with the Prime Minister's request to proactively review the regulations on business conditions, propose amendments and replacements to be suitable to the new requirements of the economy and State management.

It must be emphasized that these "barriers" to the direct impact of small and medium-sized enterprises, new enterprises and start-up enterprises are an important driving force of growth.

The Prime Minister has seen this situation. At the Government’s session of the developing  legal issues at the end of August, the Prime Minister once again requested to reduce business conditions, Sir.

- Dr. Vu Tien Loc: This is a good news for the enterprises community, because the unreasonable business conditions are constraining the creative ideas of enterprises, even cause the reason that enterprises do not want to do long term business.

But enterprises need to see changes in the State management’s thinking of the heads of ministries, departments and civil servants involved in developing this mechanism.

VCCI and CIEM have independently researched and submitted to the Government’s Prime Minister proposals to reduce the business conditions. We can completely cut half of the current business conditions without effecting state management.

Why is the state management agency forcing the enterprises of passenger transport business to submit the business plans? Why do the helmet manufacturers have to invest in equipment to produce all the components of the helmet instead of using satellite enterprises and producing enterprises of materials and accessories? Why is the regulation on a qualifying certificate valid for a period of 5 years?

Are there investors who invest real money when they are not sure after 5 years if they are allowed to work anymore? ... The way to intervene in the market, distort the market also create the reasons for enterprises to apply the asking and giving mechanism and live by relations...

Without removing the nodes of this state management’s thinking, it is difficult to create a strong momentum in the private sector. And private enterprises shall still choose small scales to avoid the legal risks. The economy shall not achieve a sustainable growth if significant growth’s motivation are lack of a larger and more powerful motive.

This is the reason why enterprises would like to see the specific actions taken by ministries and sectors in cutting down on the business conditions as well as regulations related to the specialized  management. The actions of the Government shall determine the actions of the business community.

At present, private enterprises are really would like to grow and become an important driving force of the economy ...

  • By : Ha Anh (Labor Newspaper) / Translator: HaiYen-Bizic


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