Further Improving Business Climate

By introducing many policies and solutions and taking specific actions and responses, Quang Binh province has managed to speed up public administration reform and improve the investment and business environment. Vietnam Business Forum has an interview with Mr Dinh Huu Thanh, Director of the Quang Binh Department of Planning and Investment, on this issue. Song Uyen reports.

What do you think about the investment attraction results of Quang Binh from 2016 to date?
In recent years, Quang Binh has carried out many measures to improve the business climate, e.g. accelerating public administration reform, particularly investment administrative procedures; introducing local potential and investment opportunities; organising government - business dialogues; reviewing and adjusting development plans; and developing infrastructure. The province supplemented mechanisms and policies and applied the highest incentives on land and water surface rents, corporate income tax and export for investors. Major projects are also entitled to separate incentives according to decisions of the Provincial People’s Committee. With the firm actions of all levels of government, Quang Binh province is considered one of best investment and business environments in Vietnam where administrative procedures are settled in a short time and the Provincial Competitiveness Index (PCI) is getting better.

Investors from many countries and territories such as India, South Korea, Czech Republic and Taiwan have come to Quang Binh to seek opportunities. From 2016 to September 30, 2017, the province licensed 184 domestic direct investment (DDI) projects with a total registered capital of VND14 trillion (US$622 million) and four foreign direct investment (FDI) projects with US$66.505 million, including many driving projects like VND3,600 billion Hai Ninh Resort invested by Faros Construction Joint Stock Company, VND4,800 billion FLC Quang Binh Resort and Villa Complex, VND1,000 billion Trade Centre, Hotel and Shophouse Complex invested by Vingroup Joint Stock Company; VND996 billion cow farming project invested by Hoa Phat Group; and US$55.6 million solar power plant project invested by Dohwa Group of South Korea.

The province’s investment attraction results are very encouraging and motivational for the local economy. However, outcomes do not meet the potential and expectations of provincial authorities. Many highly potential fields like tourism, construction material production, forestry, fishery and agro-forest product processing have not attracted comparable projects. Meanwhile, FDI projects remain small scale. Many projects have low production and management levels. The limited capacity of some investors gives rise to their underperformance. Besides, the province is distant from major economic centres of the nation, synchronous but small-scaled infrastructure fails to support industrial production effectively, and labour levels are still limited. Furthermore, the marine environmental incident caused by Formosa in 2016 stagnated many local businesses, especially those engaged in services and tourism. In addition, some departments and localities are not active enough to effectively support enterprises. Some stages of public administration reform fail to meet requirements. These bottlenecks need to be addressed in the coming time.

In the 2016 - 2020 period, which areas have Quang Binh province focused on to avoid spreading investment and to promote its competitive edges?
In previous years, the province made a great effort to promote and attract investment, but the outcome was modest. From 2014, by connecting four interconnected stakeholders (authorities, banks, investors and journalists), the Provincial People’s Committee coordinated with the Bank for Investment and Development of Vietnam (BIDV) to organize the Quang Binh Investment Promotion Conference in 2014 and the Quang Binh Investment and Tourism Promotion Conference in 2015. At these conferences, the province awarded investment certificates to 22 projects with a combined pledged capital of VND9,384 billion, and signed 19 cooperation agreements with a total value of VND26,572 billion.

Shortly after that, the Provincial People’s Committee established workgroups to support key projects and assigned departments and branches to monitor and support investors. They responsibly reported to the Provincial People's Committee every 15 days. Every month, it hosted briefings with related agencies to review project activities and solve emerging issues. As a result, many projects accelerated their progress and were put into operation as expected. BIDV always sided with local companies and financed their business projects at preferential interest rates. This was the new point of Quang Binh province: Selecting potential investors with the help of banks, thus enhancing the quality and efficiency of investment attraction, avoiding spreading investment and sharpening competitiveness. It is expected that the Provincial People’s Committee will coordinate with BIDV to hold an investment promotion conference in the first quarter of 2018 in a bid to draw investment flows into locally advantageous fields such as industrial park infrastructure, ports, hotels, tourism, renewable energy, wood processing, garment and footwear for export.

Compared to other localities in the region, Quang Binh features advantages of natural resources and geographic conditions to carry out projects of industrial development, tourism and agro-forestry processing. In the past time, by tapping these advantages, the province has reaped remarkable successes in investment attraction. Therefore, Quang Binh has become a new destination for investors. Domestic and foreign investors and business groups have arrived in the province to explore investment opportunities, including FLC Group, Vingroup, Sungroup, SCG (Thailand), S-Foods (Japan) and KinderWorld (Singapore). Especially through diplomatic channels (such as embassies and consulates of Vietnam in Mumbai - India, Busan - South Korea and in Spain), more international investment funds and overseas Vietnamese in Germany, the Czech Republic and Thailand have come to Quang Binh to strengthen investment cooperation ties and drive local economic development.

In the coming time, Quang Binh will focus on developing the marine economy and sea economy; build Hon La Economic Zone into a general economic zone; develop Phong Nha - Ke Bang tourism into one of major tourist centres of the country; form four tourism centres of Phong Nha - Ke Bang, Nhat Le - Bao Ninh, Vung Chua - Dao Yen, and Bang tourist site and southern cultural tourism and spiritual tourism site; and turn Quang Binh into a tourism centre of Southeast Asia.

In addition, the Provincial People’s Committee issued the list of projects calling for investment capital in the province in 2016-2020, including 70 projects covering six areas: transport infrastructure (four projects), industrial and urban zone infrastructure (10 projects), tourism, trade and services (29 projects), medical and education (two projects), agriculture, forestry and fisheries (seven projects), industry, electricity and environment (18 projects), thus helping investors to capture the picture of investment in the province and pick projects of their interests. The list however is a source reference and investors can choose investment projects fitting their competency and capacity, as well as the local socioeconomic development plan.

How do you assess the reform of administrative procedures relating to investment attraction, especially after more than one year of executing Decision 1319/QD-UBND dated May 6, 2016 of the Provincial People's Committee on public administration reform in the 2016 - 2020 phase?
In the past time, the province has paid much attention to carrying out many solutions to accelerate public administration reform to further facilitate investment and business, and achieved remarkable results.

Immediately after the Provincial People's Committee issued the Decision on public administration reform for the 2016 - 2020 period, provincial departments, branches and localities have specified it with detailed action programmes and plans. Outstanding results in the past year include:

As for policy and mechanism reform: Authorities have actively reviewed and amended regulations and policies on business and investments in line with the new Law on Enterprises, the Law on Investment and enforcement guiding documents. The Department of Planning and Investment advised the Provincial People’s Committee on the order and procedures of implementing investment projects (reducing settlement time by at least 20 per cent) and State management on business establishment registration.

As for the reform speed, administrative procedures have been simplified to reduce the time and expense of fulfilling administrative procedures. The province has operated administrative procedure reception units in 157 out of 159 communes and wards and 15 out of 21 provincial departments. The reception of documents and the delivery of results are made in one place. The volume of overdue applications sharply dropped. Administrative procedures relating to investment, business and planning are publicised in public administrative centres and on websites of agencies and units at the service.

As for public employee development, the province has made marked progress in improving the competence, expertise, creativity and responsibility of civil servants and officials, particularly leaders of important units.

As for administrative modernisation, the province has deployed 13 Level 3 public services and one Level 4 public service online. The online delivery system has brought in certain effects. The province has carried out the project on establishment of the Provincial Public Administrative Centre (expected to start operation in the end of 2017), which receives and settles administrative documents and returns results to organisations and individuals.

As for leadership, leaders of administrative agencies and units are responsible for the progress of administrative procedure reforms within their jurisdiction; publicise all procedures and personnel in charge of settling procedures; and perform inspections on the performance of their subordinates, and firmly tackle civil servants and officials found to be harassing enterprises.