Workers craft handmade household products from natural materials at the Ngoc Son JJC in Ha Nam province (Source: VNA) Hanoi (VNA) - The private business sector in Vietnamis vital for the economy, however, obstacles and challenges remain, which canonly be overcome through the combined efforts of policymakers and businessleaders next year.
This was the conclusion of an economic forum on domesticenterprises’ adaptation capability in a changing economic environment held inHanoi on December 7 by the Vietnam Chamber of Commerce and Industry (VCCI).
At the forum, Hoang Quang Phong, VCCI’s Vice Chairman, saidthe government has determined to reduce costs for businesses from 2017 onward,cutting up to 50 percent of unnecessary business licences.
Nguyen Hong Long, deputy head of the Government’s SteeringCommittee for Enterprise Innovation and Development, stated that the privatesector has grown strongly, with nearly 620,000 operating enterprises,contributing to 40 percent of GDP.
It attracts some 51 percent of the nation’s labour force andgenerates about 1.2 million jobs per year, Long added.
Still, he warned of issues related to the economic model,mainly based on cheap labour and low technology level; which had graduallyexhausted natural resources, although efficiency and productivity had stillincreased significantly.
Doan Trong Ly, director of the Animal Production Processingand Import-Export Jsc (APROCIMEX), stressed that the private sector had beenidentified by the Government as the focus of support and favourable policieswith firm actions taken, including significant tax reforms and customs clearancechanges in 2017.
Do Van Ve, deputy general director of Huong Sen Group JSC,was optimistic about 2018’s positive business trend as he believed the nationalbusiness environment was on the rise.
Many Vietnamese enterprises have recovered with positivesignals for a 2018 breakthrough, such as increases in oil and gas exports,textile and garment services and agricultural products, he said.
Statistics from the VCCI showed that Vietnam’s economictargets set by the Government for 2017 are plausible, although forecasts for2018 highlight issues faced by domestic enterprises that are still limited incapacity and competitiveness, Phong said.
Vietnam has advanced in ranking on several businessenvironment and global competitiveness indexes, Phong emphasised.
Dam Quang Thang, chairman of the Hanoi AgriculturalChemicals Association, said Vietnamese businesses need to be aware of thecurrent world situation, lest they become exploited when Vietnam participatesin bilateral or multilateral free trade agreements.
Vietnamese businesses need to readjust their business andwork ethics to avoid litigation or penalties upon entering important marketssuch as Japan and the European Union.
Phan Duc Hieu, deputy director of the Central Institute forEconomic Research, said private enterprises must take the initiative to improvecompetitiveness.
According to Hieu, Vietnam is ranked 93 out of 128 countriesin terms of technology absorption capacity. The quality of Vietnamese suppliersis especially weak, with limited number of registered patents, ranking only 91from 128 countries.
A survey by VCCI showed that 116,000 new businesses were setup from January to December 2017. However, out of all enterprises currentlyoperating, more than 60 percent have reported unprofitable business, whichcould be either due to incompetence or tax fraud, Hieu added.
According to Ly, domestic enterprises still face manydifficulties, including lack of capital, obstructing policies and unresponsivemarket.
He argued that there is a need to further strengthen riskmanagement and oversight functions within the private sector.
The long-term challenge for Vietnam is to maintain highgrowth rate coupled with sustainable poverty reduction while continuing toaccelerate the process of State-owned enterprises restructuring, improvebusiness environment and remove barriers to productivity improvement, Phongsaid.
According to VCCI’s report, so far, the 2017 GDP growthtarget of 6.7 percent is within reach, while all 13 targets set by the Centraland National Assembly have been exceeded.
Within the framework of the event held yesterday, VCCI andthe Vietnam Accounting-Audit Association announced the launch of a newenterprise capacity assessment programme, focusing on businesses Key ResultIndicators and Performance Indicators.
The 2018 Business Forum featured talks from economicexperts, business representatives and corresponding authorities, withforecasts, discussions, recommendations and consultations to help businessesidentify challenges and seek development opportunities in 2018 and beyond.-VNA
VNA
