Lang Son Determined to Improve Business and Investment Environment

11:01:55 AM | 23/7/2014

To fulfil its determination to improve the business and investment environment and enhance the provincial competitiveness index (PCI), Lang Son province has applied many positive and comprehensive solutions such as: administrative reform, dialogues to remove difficulties for enterprises, and issuance of a number of mechanisms and policies to support enterprises. To better understand these efforts to improve the business and investment environment, Vietnam Business Forum had an interview with Mr Nguyen Van Binh, Vice Chairman of Lang Son Provincial People’s Committee. Duy Anh reports.
Could you please share with us some of the outstanding results in the socio-economic development of Lang Son in the first 6 months of 2014?
Lang Son province has built up the programme and specific plans to focus on directing and implementing the positive and comprehensive solutions on the fields of economics, society, defence and security. Besides, the province has directed multi-level agencies to draft plans in accordance with the Resolution of the Provincial Party Committee and the key objectives and tasks 2014 of the Resolutions of the 8th session of the Provincial Council XV; the results are achieved as follows:
The growth rate of the first 6 months of the year was estimated at 8.22 percent. The market is stabilised and the commodity price is effectively adjusted; in the first 6 months, there were VND20 billion supported for enterprises to implement the price stabilisation. The essential items are provided regularly and fully in accordance with the consumer's demand and productivity of the businesses. Total turnover of the retail goods is estimated at VND6,207 billion, accounting for 45.6 percent of the plan, up 14.2 percent over the same period. The social and cultural sector has significant progress. The social security is guaranteed, and the lives of the people are stable and gradually being improved. The political security, social order and safety, and national sovereignty border are maintained. Domestic trade continues to grow and the commodity markets are abundant enough to meet the demands of production and life.
How do you assess the situation of business activities in the area at this time? In the context of the current economic downturn, what solutions is Lang Son proposing to help businesses overcome such challenges?
So far in 2014, inflation has been under control; the interest rates continue to be adjusted downward; the credit balance has been improved; the measures for tax exemption and reduction of the provincial government have helped remove the difficulties for enterprises. This enables a number of businesses to recover and maintain their production, business operation and raise capital. However, overall, the majority of enterprises in the province, especially, those operating in the fields of industrial production, construction materials, and open mining, must continue to face difficulties and challenges.
In the first 6 months of 2014, in general, the business situation of enterprises has not been significantly improved; businesses continue to face difficulties as the previous year, mainly due to the gloomy market, more difficult access to business loans, inefficient business performance; besides, some businesses are operating their main business moderately to maintain business and the majority is quite reluctant to expansion.
Most businesses in the province of Lang Son are small and medium sized, accounting for 98 percent of the province's businesses; the operational efficiency of enterprises is low and not commensurate with their potential. Businesses are currently facing a major challenge, that is lack of funds to reinvest business and improve technology equipment to expand production. Access to loans in commercial banking is difficult because due to the businesses do not meet the conditions of the banks. To contribute to help businesses overcome difficulties, especially SMEs who have feasible business plans but not having enough collateral to reach out and get a loan from the bank, Lang Son drafted the project to establish a credit guarantee fund for SMEs, which is approved by the Lang Son Provincial Council and will be going into operation in August. This is one of the measures to remove the financing difficulties for enterprises in the province. Besides, the province accompanies businesses in all circumstances; specifically, it will create a connection between the business with the commercial banks and among the government agencies, banks and businesses in the area. The province will also be a channel to connect the bank loans to businesses, contributing to credit growth, accelerating the industrialization and modernisation of the country, creating jobs for workers, and increasing the state revenue.
In the next time, the province continues to focus on directing and implementing drastically, seriously and positively the resolutions of the government to remove difficulties for enterprises. The focus is to create favourable environment for the market entry procedures and the procedures to change the business and investment content and registration procedures. Besides, the province accelerates the reform of administrative procedures, investment in the infrastructure of border gates, frontier markets and innovates the methods of inspection and control as well as reinforce the officials to settle the goods congestion local goods at some border gates. In addition, the province has instructed the State Bank branches in provinces of Lang Son to coordinate with credit institutions to actively mobilize capital for investment and development loans; in addition, the province sets priority for credit loans with reasonable interest rates for business development in the fields of agriculture, manufacturing of exporting products, supporting industries, competitive sectors of the provinces, small and medium enterprises, effective projects, labour- based projects, and lending for the poor and targeted groups.
The reform of administrative procedures is one of the factors that plays an important role in attracting investment and promoting economic development. Could you please share the related activities that Lang Son has implemented in recent years?
Identifying the administrative reform is a key task, in recent years, the administrative reform has been prioritized by the provincial agencies in all levels. The provincial people's committee (PPC) has built up an administrative reform, supervision and monitoring plan for recent years; in 2014, the PPC has built and deployed the 120/KH-UBND plan dated 12/30/2013 to supervise the administration monitoring procedures in 2014 in the province of Lang Son. At the same time, the PPC accelerate the dissemination and implementation of the government documents of the administrative reform. The province is comprehensively implementing the Decree 63/2010/ND-CP, dated 08/6/2010 of the Government on administrative control procedures, the Decree 20/2008/ND-CP of the Government, dated 14/02/2008, on receiving and handling the feedback and recommendations of individuals and organizations on the administrative regulations, and Decree 48/2013/ND-CP of the Government , dated 14/05/2013, on amending and supplementing a number of articles of the decree relating to the control of administrative procedures as well as the guidelines of the Office of Government on implementation of the control of administrative procedures. Through that, the reform of administrative procedures has made positive changes.
In recent years, the implementation of the administrative reform in the province has a noticeable change. The province is applying the one-stop system and electronic applications in all departments, agencies, districts and cities as well as announcing the online transactions for some public services through provincial online portal and the investment and business promotion and supporting website. This helps promote transparency of the investment and business procedures and enhance the efficiency of the service.
In 2013, the PCI ranking of Lang Son was lowered to 59th over 63 provinces and cities Could you please tell us some of main causes of the above results as well as the solutions to improve the PCI in the coming time?
The PCI is a scientific method to measure the quality of economic governance at provincial level. In 2013, among 63 provinces and cities under investigation and evaluation, Lang Son has got 52.76 points, down 3.53 points from 2012 and was ranked at 59 above 63, leading the province to be among "low" ranking provinces in the northern mountainous region.
After the Vietnam Chamber of Commerce and Industry (VCCI) announced the results, the PPC had a meeting to discuss solutions to enhance the PCI of the province in 2014 and clarify the objective and subjective reasons that led to declining points of number of criteria and hierarchical ranking of the PCI in 2013. Among them, the very basic reason is that the majority of public servants at all levels in the province are not very aware of the methodology and the many indicators of the PCI. This leads to the incorrect identification of key issues that need to be reformed. Many management agencies at the provincial and district levels don't fully understand the role of the PCI for socio-economic development of the province and underestimate reform efforts to enhance the PCI. Other reasons come from either weak economic management capacity of the staff and the management officials at all levels, that did not meet the requirements, or the weaknesses of the bureaucracy that negatively affect the investment environment and lose the confidence of business people in the government's management agencies.
To improve the PCI, Lang Son province has issued the 61/KH-UBND plan to improve the business environment and the PCI as follows:
- Raising awareness of the public officials in all levels and branches as well as the business community of the PCI. To raise the awareness of the community, the province will first raise the awareness of leadership cadres at all levels to perform consistently in the direction and administration and have responsibility for the assigned task. The role of the leader should be further enhanced, associated with the responsibilities of handling the claims and supporting for the businesses as well as improving the administrative reform and business and investment environment.
- Focus on enhancing the PCI and setting the implementation plans to improve PCI and the business and investment environment in 2014. Thereby, the province assign the tasks and duties to all level agencies to set up the clear objectives.
- Continue to promote the reform of administrative procedures, application of information technology in management and operation of the system administration level. Regularly held the thorough dissemination and strict implementation of effective government documents on the work of the administrative reform, building plan control activities through administrative procedures each year.
In addition, the province will define the criteria for assessing the needs of the business, from that raising the solutions to support enterprises in the production and business operation and development and expansion of markets products; besides, the province will make information transparent to gain business confidence as well as keep accompanying with the businesses to solve their problems. Other activities such as communication and propaganda about the role and significance of the PCI in the socio-economic development will be pushed up.