On the afternoon of October 23, Chairman of the Economic Committee Vu Hong Thanh presented to the National Assembly a mid-term review report on the implementation of the Socio-Economic Development Plan and the Economic Restructuring Plan for the 2021-2025 period.
Lending to “backyard” businesses is still complicated
Looking back over the past half term, Vietnam has basically steadfastly overcome difficulties and challenges, achieving important and quite comprehensive results, recognized internationally and domestically.
However, according to the Economic Committee, the economic structure has not changed much; productivity, quality, efficiency and competitiveness are still low, the average labor productivity in the 3 years 2021 - 2023 increased by 4.36 - 4.69%, lower than the 6.26% of the 3 years 2016 - 2018. The self-reliance capacity and resilience of the economy are still limited.
The inspection agency suggested that the Government pay more attention and assess more clearly that industrial production continues to face difficulties, the average IIP index of the processing and manufacturing industry in 2021 - 2023 is about 5.3%, much lower than the 12.5 - 13% level of the 5-year plan.
The quality of State budget revenue is still unsustainable, mainly from land use fees and crude oil; compared to the estimate, revenue from crude oil in 2021 exceeded VND 21,400 billion, in 2022 exceeded VND 49,800 billion; land use fees in 2021 and 2022 both exceeded about VND 74,000 billion. Attracting new FDI, high technology, source technology and technology transfer encountered many difficulties. Disbursement of public investment did not meet the plan.
Chairman of the Economic Committee Vu Hong Thanh (Photo: Quochoi.vn).
Institutional development and improvement work remains limited, and the debt of detailed legal documents and ordinances has not been completely resolved. Institutions for new issues and new business models, including digital economy, circular economy, and green growth, need to be reported more clearly, according to the inspection agency.
Mid-term assessment of the implementation results of the Economic Restructuring Plan for the 2021-2025 period, Chairman Vu Hong Thanh requested the Government to pay attention to and evaluate a number of issues.
In which, the tasks and solutions to restructure the economy have not been implemented much, have not brought about significant changes, and are at risk of missing development opportunities; of which 36.3% of the tasks have not completed the issuance of documents, programs, and implementation projects.
The coordination mechanism between ministries, branches and localities in implementing some assigned tasks is still inadequate; although some tasks have been implemented, the results are difficult to measure and unclear, such as human resource development, technology transfer development and promotion, innovation, private economic sector development, and restructuring of the public service sector.
The audit agency also pointed out that the capacity and management efficiency of credit institutions are still limited; the situation of “cross-ownership”, collateral assets are not properly valued, and lending to “internal” and “backyard” enterprises is still complicated. The process of handling weak banks and restructuring “compulsory purchase” banks faces many difficulties in terms of legal framework and support mechanisms.
“The task of developing various types of markets and improving the efficiency of resource allocation and use is still limited, largely due to the slow completion of institutions for the market of production factors, which is not a signal for resource allocation in the economy. We propose that the Government supplement and clarify these issues,” said Mr. Vu Hong Thanh, stating the viewpoint of the inspection agency.
Restructuring 4 key areas
In the remaining years of the 2021 - 2025 term, the Economic Committee emphasized a number of key tasks and solutions, such as closely following the international economic and financial situation; proactively analyzing and forecasting developments in international markets to have appropriate proactive response scenarios.
Focus on and accelerate the process of institutional improvement, including removing barriers, focusing on policy implementation and coordination; quickly and effectively organize the implementation of laws, resolutions, mechanisms and policies after they are issued.
According to the Economic Committee, the process of handling weak banks and restructuring "compulsory purchase" banks has encountered many difficulties.
Resolutely deploy appropriate solutions to promote disbursement of public investment capital, the Economic and Social Recovery and Development Program, 3 national target programs, important national projects, and key works.
Accelerate the preparation of the North-South high-speed railway project, develop energy infrastructure, digital infrastructure associated with improving internal capacity. Ensure national energy security, encourage the development of smart grids, renewable energy and strong participation of the non-state economic sector.
The Chairman of the Economic Committee emphasized the task of effectively and substantially restructuring the economy according to the key tasks set out in Resolution No. 31, including resolutely completing the restructuring of four key areas including restructuring public investment, the state budget, credit institutions and public service units.
“Improve operational efficiency associated with restructuring the enterprise system. Strengthen regional connectivity. Build international and regional financial centers in Ho Chi Minh City and Da Nang. Resolutely implement the project to restructure the system of credit institutions associated with handling bad debts in the period of 2021-2025. Focus on implementing plans to handle weak credit institutions; loss-making and ineffective projects and enterprises,” the appraisal agency requested .
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