Dialogues for further Mutual Understanding

Policies’ transparency has a close relationship with the investment and business environment’s attractiveness. Promoted dialogues on policies between business associations and authorities have become effective information channels to settle questions raised by investors, thus helping attracting more attention from them. However, the channels have yet to receive adequate attention.

According to a survey recently announced by the Vietnam Chamber of Commerce and Industry (VCCI) the Vietnam Competitiveness Initiative (VNCI), a lack of transparency is considered by private enterprises as a major obstacle to the existing Vietnamese business environment. Among nine indicators of the provincial competitiveness index (PCI), transparency indicator of all the 42 surveyed provinces and cities was the lowest indicator, reaching 4.67 out of 10 points. Other indicators, such as market access, costs and time for the implementation of centrally-run agencies’ policies, were much better. Regarding dialogues on policies, only eight out of the 42 surveyed provinces and cities had over 20 per cent of enterprises saying that the provinces and their departments and agencies had discussed changes in policies and legal regulations on enterprises’ activities. Meanwhile, 38 other provinces and cities had over 70 per cent of enterprises saying that it was difficult to predict the implementation of legal regulations of localities.

 

According to initial and unofficial statistics from VCCI, in 2004, there were 254 business associations in 45 provinces and cities. Among the provinces and cities, Hanoi had most business associations at 78. It was followed by Ho Chi Minh City with 36 associations, Ba Ria-Vung Tau with 13 associations. Some localities which had one business association included Binh Phuoc, Tra Vinh and Bac Lieu.

 

According to lawyer Tran Huu Huynh, head of the Legal Department of VCCI, the activities of business associations in dialogues on policies remain constrained. The organisation of dialogues in many localities has a formalistic meaning. There have yet to be regular specific dialogues. Also, due to poor preparations, such as a lack of problem analysis and evaluation and the absence of authorised agencies, many dialogues have been organised as a question and answer sessions between enterprises and State agencies. At dialogues, enterprises and business associations mainly mentioned their complaints and petitions. Dialogues in which enterprises and business associations can contribute inputs and comments to policymaking and socio-economic strategy development have yet to be organised in many localities. Also, many of problems raised at dialogues have not been completely settled by State agencies.

 

Furthermore, due to a lack of a stable and transparent business environment, enterprises hesitate to invest in big and long-term projects or contribute their inputs and comments on law and policy making. Also, a lack of legal regulations on conditions and procedures for dialogue organisation and responsibility of authorised agencies in settling problems requested by enterprises and business association was a constraint to the effectiveness of dialogues.

 

Huynh said that to improve the quality and effectiveness of dialogues on policies between enterprises and business associations with ministries, agencies and localities, experience and lessons drawn by the Ministry of Finance from such activity should be applied. Accordingly, the ministry has asked its departments and agencies to organise periodical dialogues with enterprises. Also, the existing regulations on the establishment of business associations should be amended. Accordingly, associations should be allowed to register their establishments instead of waiting for licences, so that more business associations, which represent various enterprises and groups of interest, can be established. The State should gather inputs and comments of enterprises to legal documents and policies to be issued by localities, in particular socio-economic development strategies, and short and long-term plans in localities, via associations. It is necessary to stipulate that procedures and steps for gathering, analysing and processing inputs and comments from enterprises should be announced publicly on the mass media, so that the business community and the public can understand and supervise the activities.

 

In those localities with many business associations, it is possible that the associations negotiate with each other to organise periodical dialogues on the legal environment, socio-economic policies between enterprises and authorities. This can be implemented under the sponsorship of VCCI. Associations, in turn, should be active in promoting their dialogues with departments and agencies. Based on the results of the dialogues, the enterprises’ inputs and comments should be gathered to submit to provincial authorities for consideration and settlement. Associations should summarise and announce the results of dialogues to their members and enterprises, and supervise State agencies’ settlement of proposals and petitions made by enterprises. Prevention should be made in a timely manner if there is any incorrect or slow settlement of proposals and petitions by authorised agencies.

 

At the same time, representatives from local authorities should be invited to attend meetings of associations, so as to join efforts in developing socio-economic strategies for localities. Associations should supervise the activities of authorities via the Fatherland Fronts at all levels or supervise the allocation of State budget, ODA capital, and the implementation of programmes on job creation and poverty reduction in order to help enterprises to join the programmes.