Vietnam celebrates economic achievements, strives to do even better

08:55 | 31/01/2020 Economy- Society

(VEN) - Vietnam continued its reforms and innovation in 2019, building a friendlier, more transparent and lower-cost business environment despite increasing global volatility and uncertainty. Vietnam Economic News’ Thu Phuong & Ca Huong heard economists’ assessments of Vietnam’s achievements. 

vietnam celebrates economic achievements strives to do even better
Ousmane Dione, World Bank Country Director for Vietnam

Ousmane Dione, World Bank Country Director for Vietnam: World Bank will continue to help Vietnam maintain macroeconomic stability

The year 2019 can be considered a relatively good one for Vietnam’s economy, which continues to show stability in the context of increasing global volatility and uncertainty. In the latest economic outlook update, the World Bank has revised Vietnam’s growth forecast from 6.5 percent to about 6.8 percent for 2019, indicating that Vietnam is one of the economies with the highest growth in the region and the world. Vietnam reached a GDP (gross domestic product) growth nearly triple the world average (2.6 percent), 1.2 percentage points higher than the average in East Asia and the Pacific region. However, the government needs to prioritize development of a strong and dynamic private sector as a driving force for the economy’s growth. In particular, Vietnam needs to get its policy makers to pay their highest attention to addressing constraints related to financial mobilization for businesses if it is to continue rapid and inclusive growth and become a high-income country in the coming decades.

The World Bank will continue supporting Vietnam in its development, especially helping the country maintain macroeconomic stability, control inflation, and make the banking sector healthier. In addition, The World Bank will help Vietnam improve the quality of investment, focusing on the quality of infrastructure, to boost revenues and growth. Steady growth is the target.

vietnam celebrates economic achievements strives to do even better
Ywert Visser, Vice President of the European Chamber of Commerce (EuroCham) in Vietnam

Ywert Visser, Vice President of the European Chamber of Commerce (EuroCham) in Vietnam: European businesses are optimistic about Vietnam’s investment environment

The Vietnamese government is serious about creating an attractive and open investment and trade environment, acknowledging the European business community’s ideas and contributions. EuroCham’s recent Business Environment Index (BCI) surveys show member businesses’ optimism on doing business in Vietnam, indicating that Vietnam remains an attractive trade and investment destination for European and other foreign investors.

Hopefully, these positive messages from EuroCham and its members will inspire the Government of Vietnam to continue improving the investment environment in the future. I hope that the government will maintain and promote dialogue with businesses to provide direct feedback on problems they encounter when doing business in Vietnam. This shows that Vietnam is willing to address challenges faced by European businesses operating in Vietnam, especially in the context of the European Parliament’s expected vote in early 2020.

vietnam celebrates economic achievements strives to do even better
Phan Duc Hieu, Deputy Director of the Ministry of Planning and Investment’s Central Institute for Economic Management (CIEM)

Phan Duc Hieu, Deputy Director of the Ministry of Planning and Investment’s Central Institute for Economic Management (CIEM): Vietnam will continue to reduce business procedures

According to my observations, the Communist Party and government have never shown as strong a determination as they are now displaying to improve the investment environment and facilitate business dealings. Some questioned if it was necessary to issue a new resolution similar to Resolution 02 on the business environment improvement in early 2020, and I believe that the government will issue such a resolution to show its strong commitment to bettering the business environment. Resolution 02 of 2019 was assessed independently and objectively, and last year Vietnam achieved impressive competitiveness-related achievements according to the World Economic Forum’s (WEF) evaluation. According to the World Bank, all of Vietnam’s business environment indicators improved, except the business startup index. However, in general, Vietnam’s business environment ranking dropped one place, while that of many other countries improved strongly.

In 2020, Resolution 02 will remain valid and the government will issue a new resolution to continue improving the business environment, focusing on sectors with room for reform, such as taxation. In recent years, the government has slashed business procedures. We are considering mechanisms, according to which one or even two procedures are eliminated cut whenever a new one is issued or takes effect.

vietnam celebrates economic achievements strives to do even better
Economist Le Dang Doanh

Economist Le Dang Doanh: Transparent institutional reform is important

In 2019, Vietnam made efficient efforts in business environment reform, achieving improved global competitiveness, rapid GDP growth, and a record high export revenue. However, there are problems that need to be fixed. The country remains poor in terms of its institutional index and was at the bottom of the list in terms of tax payment. According to a provincial competitiveness index report by the Vietnam Chamber of Industry and Commerce (VCCI), businesses complain about unofficial costs. In addition, the country’s budget transparency ranking remains low.

Vietnam needs to continue its institutional reform, increase the application of information technology and transform into a digital economy. In 2020, with unpredictable developments expected in the world economy, businesses need to improve their competitiveness, apply science and technology, and offer competitive products with a high value added. Vietnamese businesses need to join global economic value chains, and accept standards and requirements set by the best importers. Businesses and the government should move forward in the application of information technology, e-government, e-commerce, e-enterprises, electronic invoices, and e-signatures.

Vietnam jumped 10 notches to 67th place among 141 economies, according to the 2019 Global Competitiveness Report released by the World Economic Forum (WEF). The Southeast Asian country scored 61.5 points, up 3.5 points compared to 2018. This is Vietnam’s highest ranking so far. Vietnam has jumped three ranks on the 2019 Global Innovation Index (GII) to place 42nd out of 129 economies, bringing it 17 places higher since 2016. This year’s result is also the highest ranking Vietnam has ever achieved. In the US News & World Report ranking of the best economies for investment in 2019, Vietnam surpassed its Southeast Asian peers including Malaysia, Indonesia, and Singapore to rank eighth compared to 23rd in 2018.

Thu Phuong & Ca Huong