Hanoi to hold on to Vietnam’s top business-friendly locality position

The Hanoi People’s Committee on June 5 issued Directive No.11/CT-UBND detailing measures to improve its provincial competitiveness index (PCI) in 2020, aiming to maintain its ranking among the country’s top 10 business-friendly localities.

Hanoi's results of 10 PCI subindices. Source: PCI 2019.

In the PCI report 2019, Hanoi’s ranking remained unchanged at ninth, but its score went up from 65.4 to 68.8, proving strong efforts from the local authorities towards administrative reform and creating a favorable business environment for enterprises.

Among the 10 PCI sub-indices, Hanoi has the highest score in Entry Costs, which evaluates entry costs for business startups, at 7.98 points out of 10, and the lowest at 5.39 in Policy Bias, an indicator assessing the possibility of crowding out of private activity from policy biases toward state, foreign or connected firms.

To address low score in the Policy Bias, the municipal People’s Committee requested the Hanoi Association of Small and Medium Enterprises (HanoiSME) to cooperate with other business associations in promoting the city’s supporting policies for the business community.

HanoiSME would serve as a focal point in receiving concern and suggestion from enterprises, so that they can be reported back to the committee for timely addressing.

For the Entry Costs, the municipal Department of Planning and Investment is tasked with maintaining 100% of the rate of online business registration; ensuring timely processing for administrative services of new or adjusted business registration; and making 100% of administrative procedures online at advanced stages of 3 and 4 out of the 4-level scale, with 30% at stage 4, among others.

The Department of Natural Resources and Environment is responsible for the improvement of the Land Access & Tenure, while the Department of Information and Communications to continue improving the transparency, focusing on greater IT application among state agencies and the development of e-government.

The Department of Home Affairs is assigned to improve the Proactivity indicator, including setting up criteria to assess the performance of public servants.

The Office of the municipal People’s Committee is tasked to address issues in Time costs; Hanoi’s Inspectorate is asked to deal with Informal charges while the Department of Justice is requested to solve Law & Order issues.

The Hanoi People’s Committee requested all local agencies to ensure transparency in operation and publish information on respective websites; provide guidance on construction, land use and socio-economic development plan, along with administrative procedures. These tasks must be completed before June 30.

This year, Quang Ninh province continued to maintain its top ranking with 73.40 points for the third straight year, followed by Dong Thap with 72.10 and Vinh Long with 71.3.

Notably, Hai Phong has upstaged Ho Chi Minh City in the top 10 group and relegated the latter to 14th. This is despite the fact that Ho Chi Minh City has earned score of 67.16 this year, higher than last year’s with 65.34, which showed fierce competition among provinces and cities in efforts to stay competitive in the eyes of the business community.