To create a business environment for the private economic sector to develop dramatically, becoming an important driving force for the country's economic growth, we must first solve the bottleneck of the bottleneck, which is the mechanism and the law. This is the sharing of Dr. To Hoai Nam - Permanent Vice President and General Secretary of the Vietnam Association of Small and Medium Enterprises (VINASME) with Kinh te & Do thi Newspaper.
Sir, the Vietnamese economy is setting growth targets of 8% or more. Many opinions say that to achieve this, in addition to traditional driving forces, one of the most important pillars is to promote private economic development (excluding FDI). What is your opinion on this statement?
- I completely agree with the statement that the private economy (excluding FDI) is one of the important pillars to achieve the growth target of 8% or more. The private economic sector is growing strongly, contributing about 50% of GDP, 56% of total social investment capital and creating more than 82% of jobs. Of which, the domestic private enterprise sector accounts for 28% of GDP, higher than all other economic sectors, including the FDI sector.
At present, with the strong political determination of the Party and the State, the country’s economy must enter a higher stage of development. While traditional growth drivers such as public investment, export, or domestic consumption still play an important role, they will not be enough without the breakthrough of the private economic sector.
The focus of policymakers on promoting the private sector is not only a growth strategy but also important for the long-term development of private enterprises and the Vietnamese economy. This sector is highly flexible, promotes innovation and creates the majority of jobs for the economy. If properly supported, this sector can become a locomotive for sustainable growth.
Despite its important role in the economy, many people believe that the private sector is not as favored as state-owned enterprises or FDI. So, how do you evaluate the State's support policies and the investment and business environment for the private sector?
- Over the past three decades, although the private economy has developed strongly, it has not really been given equal conditions as state-owned enterprises or FDI. Previously, policies often prioritized state-owned enterprises and attracted FDI capital, while the domestic private sector faced many barriers in administrative procedures, access to capital and land.
In recent years, the Government has taken many positive steps such as improving the business environment, supporting small and medium enterprises, and promoting innovative startups. However, the difficulties, obstacles, and shortcomings in institutions and laws have not been thoroughly and promptly resolved to suit the reality and development requirements of enterprises. Decentralization, delegation of authority, and reduction of some regulations, administrative procedures, standards, technical regulations, and business conditions have not been thorough. Some ministries, branches, and localities have not been really determined and proactive in accompanying enterprises to solve and remove difficulties.
Please note that when referring to policies to support the private economic sector, we must pay special attention to the small and medium-sized enterprise community, as well as the 5.2 million business households. Because this sector accounts for the majority of the private economic sector in Vietnam. In recent years, regardless of the difficult or favorable business environment, small and medium-sized enterprises and the 5.2 million business households have played an important role in creating jobs, reducing poverty, contributing to the State budget and economic growth.
In particular, small and medium enterprises with the advantage of flexibility have exploited niche markets and mobilized resources from the people to serve the socio-economic development of this area, also demonstrating the best ability to easily adapt to market changes in implementing new business ideas.
According to you, besides the objective impacts, what else is there internally in this area that needs to be overcome?
- Currently, in addition to the difficulties caused by external factors, the private economic sector itself is also facing many internal challenges. Here, I would like to mention 25% of small enterprises, 69% of micro enterprises (about 890,000 operating enterprises and 5.2 million business households) are currently facing the most common difficulties such as: low competitiveness and limited access to capital, technology, etc.
For sustainable development, this sector needs to restructure itself towards improving governance capacity, improving operational capacity, financial management and development strategy to increase production and business efficiency. On the other hand, it is necessary to continuously strengthen value chain linkages, enhance cooperation between domestic enterprises to create collective strength, reduce dependence on FDI; promote digitalization and innovation, apply technology to production, governance and business to improve productivity and efficiency. At the same time, it is necessary to quickly transform from the informal to the formal sector, helping enterprises better access resources such as credit, land and support policies of the State.
To develop the private economy in the era of national growth and become a pillar promoting economic development, what suggestions and recommendations do you have?
- To create a business environment for the private economic sector to develop dramatically, becoming an important driving force for the country's economic growth, we must first resolve the bottlenecks of the bottlenecks, which are institutions and laws. Therefore, the Government needs to continue to direct institutional reform, improve the investment and business environment, cut administrative procedures, strive to reduce at least 30% of the time to process administrative procedures; at least 30% of business costs, especially customs, regulatory compliance costs, informal costs and abolish at least 30% of unnecessary business conditions.
Next, the Government should soon submit to the National Assembly amendments to the Law on Corporate Income Tax, stipulating tax reductions for all small and medium-sized enterprises to nurture revenue sources and support reinvestment in production and business. At the same time, it is necessary to amend the Law on Support for Small and Medium-sized Enterprises so that enterprises can soon effectively benefit from other support policies of the State.
On the other hand, it is necessary to reform credit policies to make it easier for small businesses to access capital; encourage the system of credit institutions to promote the form of mortgage loans based on future assets. Currently, only about 30-35% of small and medium-sized enterprises can access bank loans with existing mortgage assets, while a few banks provide loans based on future assets but in very small amounts.
In particular, in the context of the development of the 4.0 industrial revolution, the country enters the era of growth, the Government needs to have policies to support enterprises in applying technology, digitizing business activities; have policies to support enterprises in training high-quality human resources, training management and financial skills... to help them improve their competitiveness; connect private enterprises with the global supply chain, support access to international markets...
Currently, the Government is seeking opinions to issue a separate resolution on private economic development, which affirms the position and role of this economic sector. What do you expect from this Resolution?
- The policy of issuing a separate resolution on private economic development is an important step forward, demonstrating a change in the management thinking of the Party and the State. This affirms the role of the private economy as the main driving force of the economy, not just a supplementary component for the State-owned enterprise and FDI sectors. Private enterprises can gradually replace the dependence on the State-owned enterprise and FDI sectors in the export sector.
The resolution needs to affirm that private enterprises are the main growth engine, contributing to GDP growth, job creation, and contribution to the State budget; private enterprises are the key factor in transforming the economic model, from a model based on capital and cheap labor to a model based on innovation and high added value. It is necessary to create confidence for private enterprises in a more equal business environment, with a higher position in the economy.
I expect the resolution to focus on improving the business environment, reasonable tax policies, promoting innovation, providing financial support for small and medium-sized enterprises, and creating more favorable conditions for the private economy to develop sustainably. I would like to note that this is a prerequisite for the development of private enterprises. If implemented effectively, this will be a boost to help the private economy contribute more strongly to GDP growth and improve the competitiveness of the Vietnamese economy.
Thank you!
06:03 03/10/2025
Source: https://kinhtedothi.vn/ky-vong-chinh-sach-dot-pha-cho-doanh-nghiep-tu-nhan.html
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