Vietnam Business Environment to Be Improved Significantly

 

Dr Cung said the Government’s Resolution 19/NQ-CP has been executed for one year (March 18, 2014) but the gauges for measuring its indicators varied from agency to agency. Therefore, the purpose of the workshop is to learn methods to compute, determine, measure and monitor business environment indicators and share expert experiences on business environment improvement. After one year of enforcement, Vietnam has developed five measurable indicators: Business start-up, investor protection, cross-border trade, access to electricity, and tax payment.

 

He said, in spite of some shortcomings, the resolution is being approached towards the direction of lower cost, reduced risk and enhanced transparency in business operations. Gladly, some indicators related to the improvement of the business environment in Vietnam have improved considerably, including tax payment and access to electricity. Currently, CIEM is consulting the Government, the business community and business associations to find common solutions to the challenges directly relating to the business environment and competitiveness that Vietnam is facing.

 

According to business environment specialists from the World Bank (WB), each index should build on case studies so as to help improve the business environment in Vietnam. WB specialists added that the WB’s “Doing Business 2015” will add data and new methods relating to construction permit index, minority investor protection index and contract enforcement index. Thus, Vietnam should look for a roadmap to further reduce administrative procedures and costs for businesses. Specialists will focus on 10 indexes/fields aimed to improve the business environment by the cycle of a small and medium business: start-up, construction permit, access to electricity, tax payment, cross border trade, contract enforcement and labour market law.

 

To build a transparent, healthy and successful business environment, Vietnam must carry out three strategic breakthroughs tied with economic restructuring: Improving the score and ranking of business environment and enhancing SOE performance. These objectives are also consistent with the main contents of the recent Government’s Resolution on major tasks and solutions on improving the business environment and enhancing the national competitiveness in 2015 - 2016.

 

Accordingly, the Government has asked ministries and branches to focus on improving the business environment, stepping up the reform of administrative procedures, shortening processes, reducing and simplifying content fields, and reducing the time and cost of implementing administrative procedures; ensure the transparency and accountability of State administrative bodies; comprehensively reform regulations on business conditions in line with international practices.

 

In 2015, the Government also wants Vietnam to achieve and exceed the average of ASEAN-6 countries. Particularly, the time required for doing taxes will be shortened to 121.5 hours a year and social insurance time will be reduced to less than 49.5 hours. Over 95 percent of companies declare tax documents via electronic means, and 90 percent of companies pay tax via electronic means. The time for starting up a business is six days while the time for access to electricity is 36 days. The time for corporate bankruptcy procedure will be reduced from 60 months to 30 months.

 

He added that, compared with Resolution 19/NQ-CP dated March 18, 2014, the new Government Resolution set higher goals for 2015 and 2016. Specifically, in 2015, Vietnam’s business environment will meet and exceed the average of six best ASEAN countries (ASEAN-6), higher than the target set by Resolution 19 (on par with ASEAN 6). And, objectives for 2016 are much higher, as Vietnam must reach the average level of ASEAN-4. This means that Vietnam will jump to the level of Thailand and Malaysia. Besides, according to the World Bank, if dispute settlement in Vietnam is reduced from 400 days to 200 days, this will be a very high criterion because the time of Singapore, standing on the top of the world, is 150 days, he said.