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Vietnam is creating favorable conditions for private sector’s development

17/1/15
                                                   Vietnamese economy is on the rise


In recent time there have been some rumors that the private sector is being treated unfairly so now they have been shrunken and gone bankrupt massively. Is this the truth? How could we figure this issue out?
A lot of businessmen have become rich quickly
Given that the private sector has been increasingly shrunken, private enterprises have been increasingly exhausted and "drown", then that is one-sided and too pessimistic assessments. According to the Stock Corporation VNDIRECT, in 2014 (by the end of the day 25/12/2014) on Vietnam stock market has appeared more 80 "dollar millionaires". And the number of people who have personal assets on the stock market equivalent value of $ 1 million or more was 395 people.
Statistics also show that the richest people in Vietnam stock market in 2014 was richer than the richest people on the stock market in Vietnam in 2006 more than 8 times (19.722 billion compared to 2.354 billion VND). The last stand of the top 100 richest people on the stock market in 2014 is richer than the last stand in the top 100 in 2006 nearly 3 times (more than 122 billion compared with 43 billion). The total value of the assets of the top 100 richest people in the stock market in 2014 reached 81.680 billion, rising by 15% compared to 2013, more than the value of the assets of the top 100 in 2006 to nearly 2.4 times. Thus, we can see businessmen in Vietnam have become richer and richer very fast.
It can be seen, in the period of 2012-2014, the country's economy had faced a lot of challenges from the downturn of the global economy. During that period, each year tens of thousands company had gone bankrupt, mostly private enterprises which were small and medium. Along with the recovery of the economy, the private sector is now in the recovery phase.
Promoting institutional reforms to support private sector
The economic development policy has been raised by Party, in which there are many sectors, the Party has also allowed the Party members to do business as the private sector. This reflects that the Party highly appreciated role and contribution of the private sector, rightly recognized the key tasks of the Vietnamese revolution in the current stage is to develop the economy and to build "rich people, strong country ". This also opened up the opportunity for the leaders of the private sector to become members of the Communist Party of Vietnam.
In view of the Party, the private sector or any other economic sectors are equal before the law: "The economic sectors, which are operating under the law, are important integral parts of the economy, equal before the law with long development and cooperation and fair competition".
The Party’s policy for encouraging private sector have been detailed by a lot of reformed law, which had been recently passed by Parliament such as Investment Law and Enterprise Law, Bankruptcy Law, Procurement Law, Investment Law...
Probably never before, the economic institution in Vietnam is now at the most favorable for production and business. Citizens can do business in all sectors that the law does not prohibit. The procedure also has been reduced maximum, for instance registration documents for establishing private businesses just requires a request to register, a copy of citizen identification card, passport or lawful certificates personal members.
Many economists recognize that the passed bills might create a new wave of investment and business establishment in Vietnam in the coming time. Victoria Kwakwa, Director of the World Bank (WB) in Vietnam, said that the laws are a big improvement in improving the legal framework for businesses, reducing administrative burdens and licensing, opening many more business opportunities for the private sector. "Vietnam is doing its utmost to create an attractive investing environment compared to other countries which has similar level of development," she acknowledged.
Creating a fair competitive environment
International experts estimate that the Government’s issue Resolution No. 19/NQ-CP on improving the business environment, enhancing national competitiveness, taking ASEAN 6 as comparable standards to improve administrative procedures is a turning point in thinking and approach. Fields which were chosen to implement drastic administrative reform are the tax, customs, business registration, land management.
The issue, which repeatedly referred, is the correlated imbalance between private enterprises and state-owned enterprises. This issue is being actively addressed by the equitization of state-owned enterprises, put these enterprises in fair competition with private enterprise. The equitization process has reduced the number of state-owned enterprises. The Government is making policies that give private enterprises equal opportunities with the State-owned enterprises, focusing on the access to credit, land and the access to state’s projects.
To help private enterprises have more opportunities to access bank loans, the Government has established Guarantee Fund for small and medium enterprises. This fund is not only for guarantee but also direct lending with simple and friendly mechanism for small and medium-sized enterprises.
Thus, we can see the support and promote the development of private economy is in strategic direction and has been shown by the legal framework and the specific policies in Vietnam. Due to the historical features and present circumstances, the private enterprise has not yet developed strongly as expected. But for sure, the rise of the private sector is associated with prosperous future of Vietnam. /.


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All comments [ 10 ]


John Smith 17/1/15 22:18

Thanks to the comprehensive economic reform, the transformation from acentrally planned economy into a market economy and the implementation of opendoor policies, Vietnam has gained remarkable achievements in economicdevelopment

Voice of people 17/1/15 22:20

Vietnam is aiming for an economic growth of 5.8% this year, compared with growth of 5.42% last year

Gentle Moon 17/1/15 22:21

The private sector have increasingly influenced economic development

For A Peace World 17/1/15 22:22

The Vietnamese Government should control the integration process to take more advantages of opportunities brought by globalization process and reduce the cost for internal and external challenges

LawrenceSamuels 17/1/15 22:23

expand and strengthen the relationship between distributors, manufacturers, and suppliers in the value chain

Vietnam Love 17/1/15 22:25

Vietnam has gained miraculous economic achievements with annual GDP growth rate of 7.46%, the reduction of inflation from three digits to one digit, the increase of aggregated social investment to 35.9% GDP,and the expansion and diversification of foreign trade

Red Star 17/1/15 22:27

Together with economic growth, Vietnam economy has witnessed a fundamental change in its structure

Socialist Society 17/1/15 22:28

Strong development of the private sector has resulted in a downward trend in unemployment rate in both urban and rural areas

yobro yobro 17/1/15 22:31

From a less developed country that used to have serious shortage in all kinds of commodities, Vietnam is now assessed as a rapidly developing economy.

Me Too! 17/1/15 22:32

The private sector has been remarkably improved

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