In order to effectively enforce Resolution 19/NQ-CP of the Government of Vietnam dated March 12, 2015, Lang Son province is carrying out directions to remove bottlenecks in the investment and business environment. Vietnam Business Forum interviewed Mr Nguyen La Thong, Director of the Department of Planning and Investment of Lang Son province, on this issue. Ngo Khuyen reports.
After nearly five years of implementing Resolution 06-NQ-TU of Lang Son Provincial Party Committee dated April 6, 2011 on continued strengthening of investment promotion in 2011-2015, how has Lang Son province achieved investment attraction results?
Shortly after the Lang Son Provincial Party Committee issued the Resolution 06/NQ-TU in 2011, the Provincial People’s Committee directed all affiliated units to build and deploy investment attraction programmes and achieved some remarkable results. In five years, the total social investment capital mobilised exceeded VND43 trillion, including VND35.5 trillion from non-State sources, or 79 percent of the capital mobilised (fulfilling 111 percent of the target set in Resolution 06/NQ-TU). The province saw 1,118 new enterprises established with a total registered capital of VND5,458 billion in the period. By the end of 2015, the province is expected to have over 1,850 enterprises with a combined registered capital of VND11 trillion, 350 branches and 100 representative offices of domestic and foreign companies. The business sector has recruited over 24,600 workers, each of which is paid VND5 million a month on average. The province granted investment certificates to 117 projects with a total investment of VND5,200 billion, including four FDI projects. In general, investment capital from all business sectors increased year after year.
Over VND3,200 billion of ODA loan and other preferential loans were channelled into key infrastructure projects in Lang Son province in the period. Investment projects strictly followed investment processes and procedures, created good economic and social effects, and created favourable conditions for new flows of ODA loans in the coming period.
However, capital investment in the province is not much enough to tap local potential and resources. Only four FDI projects with US$8.8 million were licensed in five years, yet to reach the target of Resolution 06/NQ-TU). The province is expected to have 32 FDI projects with US$225 million by the end of 2015, of which the disbursed value will reach US$90 million.
On July 15, 2014, the Lang Son Provincial People’s Committee issued Plan 61/KH-UBND on improving the business environment and provincial competitiveness index (PCI) in 2014. From the view of an advisory body and coordinator for the checking and implementation of the plan, how do you assess the results achieved after one year of implementation?
In 2006, the Vietnam Chamber of Commerce and Industry (VCCI) announced PCI rankings of 63 provinces and cities in the country. PCI scores and rankings of Lang Son province were not high in 2006 and subsequent years because of its difficulties like remoteness from major northern economic hubs, weak socioeconomic infrastructure, and low worker level, in addition to poor administration of local government.
Soon realising these issues and causes, the Provincial People’s Committee has directed departments, branches localities to carry out many solutions to speed up administrative procedure reform, perfect plans, organising regular dialogues and meetings with businesses. The Provincial People’s Committee also collaborated with VCCI to organise conferences and seminars on PCI component indices.
Lang Son province issued Plan 61/KH-UBND on improving the business environment and PCI in 2014. In particular, the province set specific goals: Improving PCI rankings in 2014, bettering the business environment, and raising low component indices in 2013.
One year was not a long time and results were not fully reflected but they proved significant steps forward. In 2014, the PCI ranking of Lang Son province reached 55.05 points, up five spots from 2013, to 54th position from the 59th place a year earlier. Some component indices had high scores like market entry index rose from 7.01 points to 7.71 points; labour training index climbed 5.31 points to 6.24 points; leadership pro-activity index jumped from 3.12 points to 4.14 points. Nevertheless, some component indexes dropped. Specifically, access to land index was down from 5.69 points to 4.41 points; informal charge index shed from 4.85 points to 3.95 points. Therefore, the PCI ranking of Lang Son province in 2014 was still low in the country.
Causes of these weaknesses are attributed to frequently amended and supplemented legal documents and overlapping provisions, which result in enforcement failure. The quality of human resources is still low, with the rate of highly qualified and trained workers being marginal. The coordination of branches and localities in implementing tasks is not close and not timely; thus, they fail to provide advice and proposals to the Provincial People’s Committee on this effect. Besides, the biggest obstacle in attracting investment and improving the investment environment is weak business infrastructure conditions.
Overall, after one year of carrying out the plan, positive changes in the investment and business environment have created favourable conditions for attracting investment and promoting socioeconomic economic development. These are conditions for the province to raise PCI component indices.
To implement Resolution 19/NQ-CP of the Government dated March 12, 2015, on September 3, 2015, the Lang Son Provincial People’s Committee issued Plan 88/KH-UBND on main solutions to further improve the business environment and enhance national competitiveness in 2015-2016. Would you be kind enough to talk about the major contents?
To carry out Resolution 19/NQ-CP dated December 3, 2015 of the Government on key tasks and measures to continued improvement of business environment and national competitiveness in 2015-2016, the Provincial People’s Committee issued Plan 88/KH-UBND dated September 3, 2015 on major measures to continued improvement of business environment and national competitiveness in the province in 2015 - 2016. According to plan objectives, the province will build a really open, transparent, attractive and convenient business environment for all economic sectors to do business; and uphold and raise PCI component indexes. Lang Son province also set out specific objectives for PCI improvement in 2015-2016, aiming to enter the group of provinces and cities with good PCI rankings.
Major plan tasks are promoting technological innovation and information technology application to management; encouraging enterprises of all economic sectors to promote technological innovation and information technology application to business and production activities; focusing on enforcement of new legal documents in 2015; introducing effective policies to mobilise resources for socioeconomic development; reforming public administration reform and reviewing administrative procedures on electronic portals; assigning capable personnel in administrative apparatus; reviewing master socioeconomic development planning, industry development planning to 2020; and adjusting conditions for effective investment promotion and capital mobilisation.
To implement the above plan, the Provincial People’s Committee requires departments, branches, localities and units to base on their functions and tasks to work out specific actionable plans. The Provincial People’s Committee also assigned the Department of Planning and Investment to study, advise and propose the establishment of a steering committee for PCI improvement and a provincial business association to gauge enterprises’ feedbacks on the quality of governance of local governments.
The Provincial People’s Committee will request heads of department, branches, localities and units to base on their functions and tasks to direct and administer the implementation of the plan and stand answerable to the Provincial People’s Committee for the carrying out of the Government’s Resolution 19/NQ-CP.
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