Unlocking private resources

The revolution in streamlining the apparatus is expected to become an important basis in turning the private economic sector into a vanguard to exploit new growth spaces.

VinFast automobile factory in Hai Phong - Photo: NAM TRAN

Mr. VU TU THANH

Mr. VU TU THANH, deputy executive director of the US-ASEAN Business Council, who organized the visit of a delegation of US businesses in the aerospace, defense and security sectors to Vietnam, affirmed this when talking to Tuoi Tre about Vietnam's double-digit growth target in the coming years.

Mr. Thanh said: Just like businesses, state administration also needs to be restructured. It is not simply about cutting personnel and reducing regular expenses, but more importantly, reorganizing the state management apparatus to suit the new economic structure with new business models and technologies. We believe that at least from a theoretical perspective, we have grounds to believe that double-digit growth from 2025 is feasible.

Double-digit growth is possible

* Many experts expect that streamlining the apparatus will contribute to promoting GDP growth. What is your opinion on this issue?

- Although the budget is not too surplus, it has not been disbursed in the past due to many reasons. One of them is that the current organizational structure is outdated and cannot be used as a tool to promote public investment disbursement. Therefore, streamlining and reforming can promote public investment disbursement, improve the efficiency of public investment capital, and contribute to promoting GDP growth.

Second is the manufacturing sector for both export and domestic markets. The export channel is at risk that the Trump administration may impose high tariffs on goods from Vietnam to the United States, but there is an opportunity for us to neutralize or mitigate the impact of this policy. Combined with the trend of expanding production in Vietnam from foreign enterprises will continue. Therefore, the domestic manufacturing sector will continue to expand for the export market.

Regarding production serving the domestic market linked to domestic consumption, it will be supported by two factors: public spending and production for export. Importantly, these three factors, when implemented simultaneously, will be mutually supportive. When combined with the reform of the state apparatus towards greater efficiency, the growth rate can be exponential rather than linear.

In the short term, meaning the next 5 years, we believe that the double-digit growth target is feasible. But how to maintain this speed for the long term until 2045 is still a variable, it is impossible to foresee how the global economy will change, forcing us to adjust as we go.

* The contribution of the private sector accounts for about 10% of GDP. What role does this sector, which is considered creative and dynamic, play in the new growth model?

- For a long time, we expected the state-owned enterprise sector to lead science and technology and innovation, but in reality it was not effective.

In the upcoming high growth cycle, it is imperative to enhance the role of the private business sector. They will be the vanguard to exploit new growth spaces and their most important weapons are science, technology and innovation.

The Central Government issued a resolution on developing the private economy a few years ago, but it has not been very effective, although the private sector has "gone". A recent example is Nvidia CEO Jensen Huang's recent visit to Vietnam, where he cooperated with private enterprises such as FPT or VinBrain, not with any state-owned enterprises.

Private enterprises are more dynamic and flexible than the state sector in receiving technology transfer and conquering difficult markets abroad.

Source: State Bank - Data: LE THANH - Graphics: T.DAT

The private sector is highly competitive globally.

* The story of considering the private economy as an important driving force of the economy has been mentioned for many years, but in reality there is still a gap, sir?

- The problem here is that the State and the Government create a mechanism for them to do so. The Government is moving in the right direction. On December 29, 2024, Prime Minister Pham Minh Chinh requested to abandon the mindset of banning if you can't manage, and managing if you don't know.

The Prime Minister also thoroughly understood the mindset that whoever manages best should be assigned tasks, and that the State should not do anything that people and businesses do well. What is prohibited should be put into law, and what is not prohibited should be created space for creativity.

It is not just theory and we need to look at the current reorganization of the state apparatus as the basis to ensure that the above principles are applied in the most rigorous and practical manner.

In the past, the practical apparatus did not apply or did not apply thoroughly. But now it can be seen that both in theory (i.e. the law stipulates) and in practice (i.e. the implementing apparatus) that principle must be applied.

I think in the future there should be a mechanism for any bureaucratic enforcement apparatus that does not properly implement the principles will be sanctioned, not just sanctioning people and businesses.

* What are some good examples from the private sector in a leading role, sir?

- At the recent 2nd International Defense Exhibition, there was exciting news that a Vietnamese enterprise was assembling aircraft. These were the first tentative steps in exploiting the aerospace and space industry that had never been exploited before.

That is not the only enterprise capable of receiving technology transfer to assemble aircraft in Vietnam. We need a period of assembly and then make efforts to gradually localize and self-control the supply chain.

As for smaller flying vehicles such as light drones, a Vietnamese enterprise is self-sufficient in research, development, design, and production and has no competitors with international products in some specific segments.

That is just an example in one industry to prove that the Vietnamese private sector is highly competitive globally. The fact that Vietnamese enterprises have taken the first steps in exploiting aerospace space is an event that has already happened. Therefore, the Prime Minister's statement that Vietnam will exploit aerospace space is not a slogan, but is speaking on an ongoing basis.

We know that there are a few companies that are in the process of receiving technology transfer, they just haven't announced it yet.

* In your opinion, what needs to be done so that enterprises in the state and private sectors have equality in the economy?

- One is to ensure equality between private enterprises and state-owned enterprises. That means all must follow the market mechanism and have equal access to resources. State-owned enterprises are given more preferential treatment in accessing land, water resources, and capital.

For sectors related to social services such as telecommunications, infrastructure or electricity, bidding should also be organized.

Second is the source of capital expenditure. State-owned enterprises often do not have the same autonomy and flexibility in making decisions on investment spending or capital mobilization as private enterprises. Thus, they may not be able to seize market opportunities in time. To create equality between the two sectors, it is necessary to remove difficulties for both so that they can compete and improve their own efficiency.

Equality in both directions, not reducing incentives for state-owned enterprises but allowing both sectors, especially the state sector, to operate closer to market economy principles.

The third equally important factor that the Party and Government are promoting is that in any field where the private sector is doing better than state-owned enterprises, state-owned enterprises need to divest and step back so that private enterprises can do it.

That means promoting the role of private enterprises and improving the efficiency of the economy. When the scale and scope of state-owned enterprises are reduced, it also means reducing the management apparatus for this sector, and from there, the streamlining of the apparatus will take place naturally.

Processing seafood for export at Go Dang Joint Stock Company (Ben Tre) - Photo: TRUC PHUONG

* Mr. Hong Sun (Chairman of the Korean Business Association in Vietnam):

Need to focus on industrial development

Vietnam needs to focus more on industrial development, as this is an important foundation for long-term growth. However, the goal should not stop at serving the domestic market of 100 million people but should aim at exporting and building Vietnamese brands in leading fields in the world.

Vietnam still does not have a prominent brand that has reached international stature. Perhaps it is time to initiate a movement for the manufacturing industry, using this as a foundation for sustainable economic development.

To realize this, the human factor plays a key role. Not only is it necessary to have a source of unskilled labor, but it is especially necessary to have a well-trained and highly skilled workforce. When the quality of human resources is improved, not only will private enterprises participate more deeply in the global supply chain, but the workers themselves will also benefit.

With higher value, they can receive higher income, increase spending and thereby stimulate domestic consumption. However, this is still a difficult problem when most of the current workforce is hard-working and intelligent but has not been properly trained to develop creative thinking.

Many people talk about the goal of double-digit economic growth. This is an ideal goal, but to achieve it, there will be many big challenges. However, Vietnam is still a country with great potential for development, so it is entirely possible to aim for the goal of becoming an upper-middle-income country by 2030.

* Mr. Nguyen Chi Dung (Minister of Planning and Investment):

Removing bottlenecks, unleashing private resources

There is still a lot of room for resources in the economy but they have not been exploited and used effectively, especially private resources. Therefore, it is necessary to create stronger breakthroughs in mechanisms, policies, and laws, creating a truly favorable environment to attract resources, especially resources from the people, for national development.

It is necessary to promote the development of domestic enterprises, ethnic enterprises; cooperative economic organizations, especially large private economic groups with strong potential, capable of competing regionally and internationally, leading the growth of industries, fields and localities.

To do this, we must immediately remove the bottlenecks and obstacles of many State and private projects to immediately release the backlog, congestion and waste of resources. Create a favorable investment and business environment to attract investment and develop production and business. Support the development of large, leading enterprises and private enterprises to reach out to the world and invest abroad.

Strengthen economic dialogue, attract large FDI projects with spillover effects, lead to new economic sectors and fields, domestic value chains and participate more deeply in the global value chain. Develop strong enough policies to connect businesses, cooperate and develop together between domestic enterprises and FDI enterprises.

* Associate Professor, Dr. Tran Chung (Chairman of the Vietnam Association of Road Traffic Construction Investors):

Quickly remove obstacles in PPP investment

Public-private partnership projects in recent years have brought about real results. Therefore, mobilizing private and social resources for infrastructure development and promoting growth is very important.

Although there is a Law on Investment under the Public-Private Partnership (PPP) method, in recent years there have been very few PPP projects implemented. This shows that the PPP investment institution is a bottleneck.

Even the PPP Law has not encouraged private investors to participate enthusiastically. When participating in PPP investment projects, private investors are always considered "underdogs" while the State and investors should be equal in terms of responsibilities and benefits.

Many times, private investors fulfill all their commitments and responsibilities in the PPP contract but still suffer losses due to the mechanism. The PPP contract is the highest legal basis, so the parties need to properly fulfill their contractual obligations, only then will the private sector feel secure in investing in infrastructure projects.

It can be seen that PPP investment has been implemented in recent times to basically overcome some weaknesses of public investment such as prolonged construction time and price increase.

However, PPP projects often have to be recovered over a long period of time, at least 14-15 years, longer than 20-30 years, so the State must create trust for investors, helping them feel secure in investing money in projects.

* Mr. Nguyen Van Toan (Vice President of FDI Enterprises Association):

Promoting cooperation between domestic enterprises and FDI enterprises

To break through and develop new industries such as semiconductors, artificial intelligence, 3D technology, and big data, the participation of leading foreign direct investment (FDI) corporations is certainly required. When large enterprises such as NVIDIA, Amkor, and Hana Micron appear in Vietnam, the most important thing is whether domestic enterprises can participate deeply in the supply and production chains of these enterprises.

The connection between the FDI sector and the domestic sector needs to be placed on the shoulders of large Vietnamese corporations such as FPT, Vingroup, Viettel, VNG, Sky Mavis... In addition, the education and training system of high-quality human resources needs to be done well to "attract" high-tech FDI capital, thereby increasing the value of Vietnam's benefits. Without high-quality human resources, it will be impossible to "retain" high-tech FDI investors.

In recent years, about 60-70% of FDI capital has been invested in the processing and manufacturing industry. This is an advantage, but we need to do better in training high-quality human resources in the coming time to welcome and "retain" high-tech FDI investors for long-term investment in our country.

A positive signal in FDI investment in recent times is that leading technology corporations such as NVIDIA have entered into cooperation agreements with domestic corporations such as FPT and Vingroup. This will open a new trend in FDI investment.

This trend needs to be promoted by supporting domestic enterprises in the process of cooperation with FDI corporations. This also helps domestic enterprises gradually receive high technology from the FDI sector.

Source: https://tuoitre.vn/khoi-thong-nguon-luc-tu-nhan-20250101094129041.htm