16:38 | 08/05/2019 Society
(VEN) - The unofficial cost of doing business in Vietnam has declined and the business environment has become fairer, according to the 2018 Provincial Competitiveness Index (PCI) recently issued by the Vietnam Chamber of Commerce and Industry (VCCI).
However, the report also pointed to deterioration in some fields. For example, the percentage of companies agreeing to pay unofficial expenses to tax officials grew from 39 percent to 53 percent. Sixty-nine percent of surveyed companies admitted that they sought data and information from local authorities in a nontransparent manner.
Positive changes included a decline in the percentage of companies reporting that they had to pay unofficial expenses - from 66 percent in 2015 to 55 percent in 2018. The number of companies with under-the-table expenses accounting for more than 10 percent of their revenue has also declined, from 11 percent in 2015 to seven percent in 2018.
Localities are becoming more interested in promoting the domestic private sector rather than focusing on attracting foreign investment. The overlap of inspections has decreased, while the percentage of efficient state officials has increased.
In the 2015-2018 period, business registration procedures were simpler, but post-registration formalities were complicated. Specifically, the percentage of companies having to wait for more than one month for permits to begin operations increased from 10 percent in 2015 to 16 percent in 2018.
Challenges facing businesses include difficulties in finding customers, partners and suppliers, accessing capital resources and production space, adapting to market and policy changes, staff recruitment, complicated administrative procedures and poor infrastructure.
“Compared with other types of businesses, micro-enterprises and companies established in the past five years have encountered more difficulties in seeking customers, capital resources, production space and implementing administrative procedures,” the report says.
VCCI President Vu Tien Loc noted that Hanoi for the first time joined the PCI’s top 10 localities nationwide in terms of the quality of management and the ease of doing business.
However, Loc also warned businesses of factors which may increase their expenses, create risks for the business environment or even undermine their partnership opportunities.
Quang Ninh Province topped the PCI list in 2018 for the second consecutive year, followed by the provinces of Dong
Thap, Long An, Ben Tre and the city of Da Nang. Other localities in the top 10 include Binh Duong, Quang Nam, Vinh
Long, Hanoi and Ho Chi Minh City.