PM acknowledges business contributions to Vietnamese economy

08:29 | 13/12/2017 Society

The business community will define the future of the Vietnamese economy in the coming decades and serve as an important driving force to achieve prosperity, stated Prime Minister Nguyen Xuan Phuc at the 2017 Vietnam Business Forum (VBF)’s year-end session in Hanoi, on December 12.

PM Nguyen Xuan Phuc at the forum - Credit: VGP

In his speech at the annual government – enterprise dialogue, Phuc acknowledged the business community’s contributions to national socio-economic development, noting that the recommendations and proposals of the business community at both micro and macro-level have assisted the Government in its efforts in developing the country.

The PM highlighted the strong growth of the Vietnamese economy as 2017 is coming to an end, with all 13 of the targets set for the year achieved or over fulfilled. The GDP growth rate, at 6.7%, is the highest in nearly 10 years.

He expressed his delight at the record number of over 120,000 newly established firms and an estimated VND3,000 trillion in registered capital forecast for this year.

Investment in the economy not only benefits enterprises and investors, but also supports the Government in its reform efforts, Phuc said.

Despite this, the PM noted that Vietnam needs to work harder to improve its business climate and competitiveness ranking, towards ranking among the top countries in ASEAN and meeting the high standards set by the Organisation for Economic Cooperation and Development (OECD).

Concerning the new trends that are impacting on the business models in Vietnam, the PM pointed to the expansion of the middle-income group, citing a World Bank report that showed that the group now makes up 10% of the Vietnamese population; while that proportion is projected to hit 50% by 2035. The trend will change the local consumption structure, thus opening up business opportunities.

He also highlighted technology development in the era of the 4.0 industrial revolution, automation and artificial intelligence.

Vietnam has 52 million internet users and about 55% of its population own smart phones. By 2020, eight in every 10 Vietnamese people will use smart phones. The situation lays an important basis for investors to promote their products and services among potential Vietnamese clients, the PM said.

Phuc emphasised that the new drivers for growth must be innovation and initiatives.

Mentioning the increasing impact of digitising the management and supply of services, he said that current limitations and shortcomings in public services are pushing the Government to build an open-source e-governance system, which he considers as a new growth driver.

“Infrastructure and technology development are key to integration and welfare distribution,” said the PM.

The Government will prioritise investment in infrastructure towards smart and efficient connectivity to improve transparency, and help businesses to cut costs and boost competitiveness, while encouraging capital flow into education and technology, he added.

Considering stable macroeconomics and society a competitive edge, Phuc said that the Government will continue restructuring the economy, overhauling the State-owned business sector, handling bad debts, controlling budget deficit and public debts, reforming the taxation system, and improving social welfare policies.

The Government is pinning its hopes on a new generation of businesses that are capable of competing at home and overseas, the leader stressed, adding that Vietnam is working to build a business climate that facilities all economic sectors.

Furthermore, PM Phuc affirmed that Vietnam does not welcome business activities that pollute the environment, degrade cultural values, or illegally exploit local labour.

Based on that spirit, the PM said that he believes the VBF would continue being an important and effective policy dialogue between the Government and enterprises toward meeting the sustainable socio-economic development goals.

The Vietnam Business Forum (VBF), which opened in Hanoi on December 12, is an annual dialogue between the Government and business community, co-organised by the Ministry of Planning and Investment, World Bank, International Finance Corporation, and VBF Consortium.