Vinh Phuc Improving Business Investment Environment to Return to Top 10 PCI Performers

Once ranked 4th, and among Top 10 performers in the Provincial Competitiveness Index (PCI) rankings for many years, Vinh Phuc province dropped to No. 17 in 2019. Resolution 01 of the Executive Board of Vinh Phuc Provincial Party Committee on some basic solutions for better investment environment and higher PCI in 2016-2020 set the target to stay in the Top 10, the group of best governed provinces and cities in the country.

Reform efforts

In 2019, Vinh Phuc province ranked 17th out of 63 provinces and cities in PCI rankings with a total score of 66.75 points, an increase of 2.2 points but a slide of four places on the standing over 2018, trailing the Top 10 goal. The province was classified into well-governed localities.

Some component indices fell sharply in both rankings and scores or improved but lost in the rankings, including land access, transparency, business support services, legal institution and security, fair competition, and labor training. This was the third consecutive year that Vinh Phuc province’s PCI dropped in the rankings.

In the overall, there were still “bright spots” of component indices where experiences and solutions can be used as a basis for replication to other component indices.

Typically, the market entry index, led by the Department of Planning and Investment, ranked No. 58 in 2017, No. 56 in 2018 and incredibly No. 1 in 2019. This jump surprised the whole country.

The market entry index is gauged by component indicators related to business registration and completion of administrative procedures: Time for enterprise registration, time for revised business registration, the total number of registration forms and permits required for official operation, waiting time for land-use right certification.

The Department of Planning and Investment has attributed the amazing movement of the market entry index to its improvement and completion of internal processes to reduce the time and procedures for businesses.

The department has sped up information technology application, reformed and simplified administrative procedures, and encouraged enterprises to register business online. The agency has fostered professional and expertise training for civil servants, especially those in charge of consulting and guiding procedures for enterprises.

In 2019, 96% of enterprises interviewed said they had sufficient and clear instructions on procedures by their public employees at the service.

The department has paid attention to concerted coordination with relevant agencies to guide and solve administrative procedures for businesses. This is extremely important because procedures involved in many agencies, if not closely coordinated, will easily be interrupted in the implementation process.

Many indicators need more improvement

To achieve the target of returning to Top 10 on PCI rankings, the province must score at least 70 points, an increase of 3.25 points compared to 2019.

Most component indices need to gain in score and climb in rankings, for example the labor training index will reach 7.5 points to be in the Top 10; the business support services index will be 6.7 points to be the Top 20; the transparency index will climb to 7.2 points to be in the Top 10; the legal institutions and security index will rise to 7.0 points to be in the Top 20.

Therefore, the Provincial People’s Committee has required provincial and local bodies to work out specific action plans to enhance component indicators, assign responsibility and accountability to responsible bodies. This will be a performance checkpoint in 2020.

The province will step up information technology application and deliver online public services of Level 3-4 for some administrative procedures; study to reduce the time to resolve administrative procedures, enhance transparency, reduce time and informal costs, strictly handle harassing and negative acts of public employees to create an attractive open investment environment for investors.

According to PCI rankings 2019 released by the Vietnam Chamber of Commerce and Industry (VCCI), among 10 PCI component indexes of Vinh Phuc, the land access index ranked No. 49 out of 63 provinces and cities, scoring 6.38 points, gaining 0.64 points and climbing 11 places over 2018.

Although it climbed in rankings over 2018, this index still ranked the lowest among the province’s 10 PCI component indices because land administrative procedures and changes in land price bracket were inappropriate. Access to land, land compensation, ground clearance and land-use rights certification are difficult. Besides, risks of land reacquisition are still high.

To make a real change in land access index, the Department of Natural Resources and Environment will actively review legal documents, advise the Provincial People's Committee to amend and issue administrative procedures concerning natural resources and environment; develop land price database, publish open and transparent land prices for investors to access and study if they seek to invest in the province.

The department will foster information technology application to reception and settlement of administrative procedures at the Land Registration Office to ensure smoothness, quality and efficiency, create confidence and satisfaction for people and businesses with administrative procedures they deal with.

A representative of the Vinh Phuc Provincial People’s Committee said, in order to return to the Top 10 in 2020 - the last year of executing Resolution No. 01 of the Provincial Party Committee, the Provincial People’s Committee has requested provincial and local bodies to base on the committee’s plan to work out specific plans to enhance indices, especially those with low scores and standings.

Source: Vietnam Business Forum