The introduction of Resolution No.19 by the government five years ago was seen as a bid for Vietnam to become one of the top three business-friendly countries in ASEAN, however, the result leaves much to be desired as most of Vietnam’s business environment indices are still below the average score of ASEAN-4 (including Indonesia, Malaysia, the Philippines and Thailand), according to the Central Institute for Economic Management (CIEM).
Overview of the workshop. Source: Ngoc Thuy.
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“The result, however, remained modest as of present,” Cung added.
Nguyen Thi Minh Thao, head of the CIEM’s Business Environment and Competitiveness Department, stated that by the end of 2015, Vietnam was expected to be on par with ASEAN-6 on five key parameters of the business environments provided by the World Bank's Doing Business report.
Over the next four years, the country should reach the average level of ASEAN-4 on all ten parameters, including “Starting a business”, “Dealing with construction permits”, “Getting electricity”, “Registering property”, “Getting credit”, “Protecting minority investors”, “Paying taxes”, “Trading across borders”, “Enforcing contracts” and “Resolving insolvency”.
In 2018, Vietnam slipped one notch in World Bank’s Doing Business ranking, but its score went up in eight out of ten parameters, Thao added.
Since 2014, the country’s business environment has been constantly improving, standing at 69th in 2018 from 78th in 2014. “Nevertheless, in the coming time, more inefficient and obsolete business conditions should be removed,” she continued.
On July 13, Prime Minister Nguyen Xuan Phuc issued a directive requiring ministries and ministerial-level agencies are required to report to the PM on a quarterly basis on the remaining number of business conditions and goods subject to specialized control regulations as the government seeks to smooth the business environment.
The directive requires there should be a clear justification of changes in the number of business conditions and goods required for specialized inspection.
According to the PM, business condition removal is one of the key measures for economic growth and efficiency, requiring strong efforts from government leaders and ministers.
At the meeting, Tran Thi Hong Minh, director of the Department for Business Registration Management under the Ministry of Planning and Investment (MPI), informed that the Vietnamese indicator of “Starting a business” in the latest World Bank report was ranked at 104th, 19 places higher compared to the ranking in 2017 with a score of 84.82 out of the maximum 100 points.
Minh added that the process of starting a business in Vietnam would take at least 17 days, while the average in East Asian and Pacific countries is 25.9 days. However, the time for the authority to complete the procedure is five days, which should be reduced to three days as stipulated in the Law on Business, Minh continued.
According to the Doing Business 2019 report, it would take 10 days for Vietnamese companies to obtain the self-printed VAT invoices and have them registered with the municipal taxation department. Minh stressed that the process would take only four days if related authorities strictly apply the procedures set by the Ministry of Finance.
The CIEM’s director stated that countries are competing fiercely with each other in their quest for prosperity through improvements in business environment and national competitiveness. “In this process, Vietnam would be left behind just by standing still. There remains much work to be done for the country to realize its goal towards sustainable development and inclusive growth,” Cung concluded.
