Vietnam Needs to Reform Business Environment Entirely: AmCham

 

Vietnam should comprehensively reform its business environment in order to achieve the target of sustainable development, the American Chamber of Commerce (AmCham) said at the Vietnam Business Forum in Hanoi on December 5.

 

According to the US chamber’s statement, the sectors that need many improvements include the legal system, infrastructure for trade and investment activities, physical infrastructure (including electric power, transport) and the anti-corruption fight.

 

Through its address, the chamber urged the Vietnamese government to narrowly comprehend its international trade commitments as it delays the implementation of bilateral trade agreement (BTA) pledges. Since the entry in to effect of the BTA in December 2001, a structural trade deficit has already begun to develop between the US and Vietnam, it is partly the result of barriers to US goods and service in Vietnam, especially the restrictions on trading and distribution rights, the announcement said.

 

Furthermore, it proposed four issues for Vietnam to quickly handle, namely market barriers to US goods, tax and customs, industry specific (where there are serious restrictions and non-tariff barriers to pharmaceuticals, banking, legal services, biotechnology, tobacco…etc), transparency and right of appeal commitments in BTA.

 

The statement figured that some recent policies, including the newly-adopted common Investment Law and the Decree on Representative Offices contain significant elements that are “steps backward” rather than improvements, therefore, the government should make more renovation in trade and investment regime.

 

Vietnamese lawmakers, however, insisted that such laws would create a fair business environment for domestic and foreign investors and business people.

 

Regarding physical infrastructure, the report urged that Vietnam should call on as well as create favorable conditions for private and foreign sectors to invest in developing physical substructure.

 

The announcement noted average electric growth demand is around 15 per cent equal to 1,500 MW due to strong economic growth, forecast number of power generation is over 20,600 MW in 2010. Thus, the number of required capital is about US$11 billion, nevertheless, Electricity of Vietnam (EVN) has merely received US$3.7 billion from foreign donors, and it can only mobilize 40 per cent of annual capital demand of US$1.5-2 billion from its internal financial resources. Vietnamese government should quickly support the contributions of private sector, it stressed.

 

Besides, AmCham proposed the government to encourage individual sector invest in maritime transport, the essential element for export growth.

 

The statement said limited capacities of seaports of container vessel size and loading capacity as current situation, maximum container units that can dock at Vietnamese seaport is 1,200 twenty-foot, will be an serious obstruct for export sector development.

 

Lastly, the report urged Vietnam to issue stricter and more transparent policies to eliminate corruption, and it also stressed the need for clear, efficient, and fair system of public service.

 

It proposed the government implement some concrete measures, including strengthening anti-bribery actions promoting integrity in business operation, supporting active public involvement to effectively fight against corruption.

 

AmCham Vietnam was founded in 1994 by a group of Americans doing business here. The commercial body has two chapters, one in Capital Hanoi and one in Ho Chi Minh City, economy hub of Vietnam