|D. Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry.|
The situation of the Covid-19 pandemic continues to be complex in Vietnam, how should support solutions from the Government be implemented?
The Covid-19 pandemic is becoming more complex, so domestic firms are still facing many difficulties. One of the most difficult problems for businesses is capital and liquidity. Therefore, in recent times, the Government has issued many solutions to support businesses and help firms reduce difficulties. In particular, most recently, the Government has issued a decree to extend the time for paying taxes, fees and land rent. This is a very timely decision to help businesses maintain production and business activities and ensure jobs for employees. This is not only a solution for economic and growth problems but also a solution for social security and socio-political stability of our country in the coming time.
Therefore, in addition to the above measures, the business community proposes to the Government to assess and consider the impact and continue to expand beneficiaries, continue to improve measures to support businesses, especially paying attention to small, medium and micro-sized enterprises. In particular, we have a policy and legal gap for business households, so in the near future, it is necessary to introduce legal regulations to protect and support business households. Helping business households also benefit from policies to support small, medium and micro-sized enterprises. This will help business households grow into businesses, forming a more sustainable and effective business community.
What do businesses expect in terms of economic management and business support from management agencies?
With very radical reforms as well as solutions to support firms in the past time, the business community has been more satisfied with the progress in State management and economic administration. But there are still many points businesses are not satisfied with, so they want to improve. In particular, many areas in the business environment have overlaps and obstacles stemming from legal regulations, which need the Government and the National Assembly to focus on research to create a transparent environment.
We can’t get out of the middle income trap if we don’t get out of the middle institutional quality trap, despite our efforts to move up the ranks, the quality of the business environment is “usually average” compared to many regional countries and around the world. This requires synchronous efforts of the whole political system, to reform substantively, avoid ostentatious forms, to personalise responsibilities and to decentralise authority more strongly. Enterprises investing in production and business do not have a term; the spirit of the manager must also not have a term in operation.
With the goal of becoming a developed country by 2045, what solutions do we need for the business community?
I think that we must have actionable programmes, specific to each development stage, most importantly, reforms must be practical and definitive to create breakthroughs. For example, the Land Law has many obstacles to land use and resource mobilisation for development, so the Land Law must be approached and revised with new perspectives.
In particular, the driving force for development must come from the opening of innovation resources, not from traditional motivations such as natural resources, cheap environmental protection fees and cheap labour. Therefore, the law system must be consistent with the nature of those resources, and must protect those who dare to think and do things for the country. In particular, we need projects as a driving force for development, be it a project that takes place over a long period of time or mobilises people’s resources from public-private projects to create stability and increase trust.
However, currently, foreign invested enterprises (FDI) are still playing the dominant role; can you tell us how to improve this situation to help domestic enterprises?
Recently, Vietnam has made many efforts in attracting FDI and can be considered as one of the most attractive FDI economies, but the quality of FDI is not high. The biggest limitation is that FDI is not linked with the domestic business community, especially small and medium-sized enterprises, existing as an “oasis”. Although exports still contribute more than 70%, imported raw materials account for 60-70%. Not only that, some FDI enterprises even pollute the environment, mainly using cheap local resources and resources, taking advantage of the Government’s incentives, disproportionate contributions to local budgets.
Therefore, we need to upgrade FDI attraction in the coming period. We will not only care about the quantity and not run after projects of hundreds of millions, billions, even tens of billions of dollars if these projects do not contribute to improving the quality of Vietnam’s development. One of the important requirements is FDI enterprises must associate with domestic small and medium enterprises, not occupy the opportunities of Vietnamese enterprises, creating a beneficial “symbiosis” in the global value chain.