To create new momentum to the process of investment attraction in the 2016 - 2020 period, the government of Hung Yen province has introduced plenty of measures to accelerate public administration reform, enhance competitiveness and improve the investment and business environment. Vietnam Business Forum Magazine has an interview with Mr Tran Quoc Van, Director of the Department of Planning and Investment of Hung Yen province. Song Uyen reports.
According to data from the Foreign Investment Agency (FIA), as of June 20, 2016, Hung Yen province had 389 foreign direct investment (FDI) projects with total registered capital of US$4.08 billion, ranked 19th out of 63 provinces and cities in the country. How do you assess this figure?
After being re-established (January 1, 1997), Hung Yen attracted four FDI projects with a total capital of US$56.7 million. From 1997 to 2005, the province licensed 46 FDI projects valued US$296 million a significant figure at the time. FDI continued to flow into the province in the 2006 - 2010 phase. Notably, up to 153 projects with a total registered capital of US$1,381 million were licensed in the 2010 - 2015 phase. Altogether, the province had 389 valid FDI projects with an aggregate registered capital of US$4.08 billion, ranked 19th out of 63 cities and provinces in the province.
To a certain extent, the above figures partly illustrated the openness and liberality of investment attraction policies as well as commitments of the provincial government. Nevertheless, the result was modest and incommensurate with local advantages. Therefore, promoting investment attraction has become a stronger political commitment of the Provincial Party Committee and the Provincial People’s Committee. The Resolution of the 18th Provincial Party Congress (2015-2020 term) defined two out three breakthroughs relating to investment promotion: (1) Focusing on attracting investment to develop modern high-tech industry with high added values; and (2) mobilising resources for socioeconomic and urban infrastructure construction, particularly traffic construction.
2016 is the first year of the medium-term 2016-2020 plan. Would you be kind enough to share some remarkable investment attraction orientations and measures of Hung Yen province for the next five years?
Clearly defining its advantages and disadvantages, Hung Yen province has proposed 15 social and economic development objectives in the 2016 - 2020 period: gross regional domestic product (GRDP) growth of 7.5-8 per cent a year; the economic structure by 2020 (55 per cent of industry and construction, 37 per cent of services, and 8 per cent of agriculture, forestry and fisheries), GRDP per capita of VND75 million in 2020, tax revenue of VND13,000 billion, export turnover of US$5 billion, and over US$10 billion of registered investment capital.
The province also built six programmes and 11 projects to realise these goals. Investment attraction, investment project reception and management and enterprise facilitation are urgent long-term tasks.
In the 2016 - 2020 period, the province defines that infrastructure investment, especially transport infrastructure, is one of three development breakthrough stages. Hung Yen will mobilise development investment resources from big corporations and FDI projects with advanced technologies and high added values to generate ripple effects on socioeconomic development.
The province advocates citizen- and business-centred public administration reform towards simplicity and efficiency, and creates the openness and transparency in administration and public services provided by State agencies. Hung Yen is also speeding up information technology application to smooth and streamline management and administration and reduce administrative costs for businesses and citizens. In addition, the province reviews and modifies plans and constructions of industrial zones to mobilise all economic sectors to invest in infrastructure construction and attract production and business projects.
How do you assess the reform of administrative procedures relating to investment attraction in Hung Yen province in the past years?
To carry out Resolution 19/NQ-CP dated March 12, 2015 and Resolution 19-2016/NQ-CP of the Government dated June 13, 2016, the Department of Planning and Investment advised the Provincial People’s Committee to issue Decision 922/QD-UBND dated April 27, 2015 and Decision 1124/QD-UBND dated June 13, 2016 on action plans to execute the two above resolutions of the Government of Vietnam. The province is determined to reduce at least 30 per cent of administrative service time of investment, land and construction-related procedures from the current regulation provided by the central government. The process carried out at the Department of Planning and Investment has shortened by over 40 per cent the time required for completing administrative procedures. Specifically, the granting/modification of enterprises registration certificate is completed in only 2 - 3 days (the law provides three days from the date on which valid applications are received), the granting/modification of investment registration certificate is done in 7 - 9 days (the Law on Investment stipulates 15 days from the date of receipt of valid applications); and the time for business start-up is shortened to just one day.
The department also actively reviews, amends and replaces the set of administrative procedures and publicises administrative procedures concerning business establishment and investment registration certificate on the mass media. On the basis of the set of administrative procedures provided by the Ministry of Planning and Investment of Vietnam, professional divisions of the Department of Planning and Investment of Hung Yen have actively reviewed, mended and proposed for the reconstruction of the set of administrative procedures pertaining to investment and business registration to guide investors to execute. The new set of administrative procedures is based on the principles of being easy to understand and easy to execute. Thus, it elaborates steps, procedures and time that investors need for completion. The Department consulted the Department of Justice on the second review of administrative procedures before it submitted them to the Provincial People’s Committee for announcement prior to June 30, 2016. Leaders of the Department of Planning and Investment has also instructed its employees in charge of directly executing administrative procedures for enterprises to regularly update new legislations to timely advise and guide citizens and businesses to comply with regulations. Furthermore, the department has arranged its capable and well-behaved employees to work at public reception divisions which receive and return results of administrative procedures.
In the past years, the Department has sped up IT applications to the process of carrying out administrative procedures concerning investment and business while applying the ISO-standard quality management system to operations at its subordinated units. Currently, the single-window unit and other professional divisions at the Department of Planning and Investment have effectively applied IT to the process of receiving, processing and returning results to reduce the service time of administrative procedures on two systems: National business registration system (applicable to business registration) and the national foreign investment information system (applicable to granting/modification of investment registration certificates). Accordingly, investors can access their registered accounts on the systems to monitor their documents processed by specialised divisions. Once completed, results will be automatically transferred to investors’ accounts.
In recent years, the provincial competitiveness index (PCI) of Hung Yen province is volatile and generally modest in the rankings. What are the reasons for this and how has the department advised and executed solutions to improve its PCI ranking in a sustainable way?
According to the results announced by the Vietnam Chamber of Commerce and Industry (VCCI), the PCI of Hung Yen province was little changed from 2010 to 2015. It had a relatively low PCI ranking in 2010 and it climbed to the group of relatively good provinces in 2011 and 2012 but it slid to the group of relatively low PCI ranking in 2013, 2014 and 2015.
The first and foremost reason is the weak coordination in activities and information sharing among State agencies in handling procedures for investors and enterprises. For example, the longer time required in granting construction permits, land-use rights and property ownership certificates and land compensation and site clearance slow down the progress of projects. Some provincial departments and agencies have not paid due attention to promoting investment, supporting businesses and providing legal aids for investors. Meanwhile, some departments and branches have not sped up IT application and applied single-window mechanism in resolving administrative procedures while their inspections and audits are overlapping and bothering.
In order to create a favourable, transparent and friendly business environment, the Department of Planning and Investment has advised the Provincial People’s Committee to promulgate many legal documents such as Decision 922/QD-UBND dated April 27, 2015; Decision 1124/QD-UBND dated June 13, 2016; Decision 905/QD-UBND dated May 16, 2016 on investment promotion programme for 2016. Currently, the department has collaborated with the VCCI Legal Department to complete the draft project “Raising PCI of Hung Yen to 2020” expected to be submitted to the Provincial People’s Committee in the third quarter of 2016. The project has analysed data to portray the province's business climate, compare with other localities in the region, and show good points to be promoted and bad points to be addressed. The department has also advised to the Provincial People’s Committee to meet and hold dialogues with businesses to learn about their opinions and resolve their difficulties.
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