Looking back on the progress in the support for businesses in 2018

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Prime Minister Nguyen Xuan Phuc visited product display booths at the National Start-up and Creative Innovation Day (Techfest) 2018. Photo: ST.

Specifying support solutions

To support businesses, the Government currently has big Resolutions. They are Government's Resolution No. 35 / NQ-CP dated May 16, 2016 on supporting and developing businesses by 2020; Resolution 36a / NQ-CP dated October 14, 2015 on e-Government; Resolution No. 19 / NQ-CP (versions in 2014, 2015, 2016, 2017, 2018) on continuing to perform the main tasks and solutions to improve the business environment and raise national competitiveness.

In 2018, the Government continued to focus on removing difficulties and creating favourable conditions for production and business. Specifically, reviewing and completing policies and laws, simplifying administrative procedures, especially on credit, taxes, fees, land, investment, construction, environment, import and export; cutting business conditions and simplifying specialized inspection procedures.

If 2016 was the year of start-ups, so far the movement of start-ups and creative innovation has developed remarkably. The issues related to legal framework to facilitate creative innovation and start-ups; capital and financial mechanisms for start-ups and creative innovation; facilitating administrative procedures for start-ups; proposals to establish a stock exchange for start-up businesses; advice and consultation for start-up businesses and assistance from large businesses, etc., have been supported by the Prime Minister and ministries and agencies to facilitate start-up businesses.

Notably, a series of dialogues between the Prime Minister and ministries, agencies and localities with the business community were implemented in 2018 to directly listen to difficulties and solve problems on capital, policies and boost the development of production and business. During the regular meetings of the Government, Prime Minister Nguyen Xuan Phuc has mentioned the reduction of business conditions and administrative procedures. The Prime Minister's working team has had meetings with each ministry, agency, locality, and specialized meetings with many ministries and agencies to accelerate the reduction of business conditions as well as inspecting and monitoring the reduction in an actual and effective manner.

A series of programs to support and facilitate businesses by cutting back on business conditions as well as specialized inspection procedures have been drastically carried out by ministries and agencies. As of December 2018, the ministries submitted and issued 21 legal normative documents, cut down and simplified 6776 / 9.926 commodity lines subject to specialized inspections, exceeding 36.5% of the assigned target, thereby saving 11,642,068 workdays and VND 5,407 billion.

Regarding the reduction of business conditions, the ministries also proposed to promulgate 3 laws and 25 decrees to reduce and simplify business conditions, thereby cutting 3,346 / 6,191 business conditions, exceeding 8.1% compared to the assigned target, saving 5,847,925 workdays equivalent to VND 872.2 billion. These changes show the active participation of ministries, agencies and localities in implementing the directions of the Government and the Prime Minister.

One of the clear moves showing the sharing between the State and businesses in contributing to reducing costs for businesses in the past year, which was highly appreciated by the business community, is decisions on exemption and reduction of fees, charges for businesses and free use of electronic invoices. This reveals the efforts of the Ministry of Finance to support businesses, which is expressed in very specific actions, not just propaganda. On the other hand, when the input cost is saved, it will create favorable conditions for businesses to reduce product price, thereby, consumers can be directly benefited; at the same time, improving the competitiveness of businesses.

Accompanying with the business community

Commenting on the support for businesses in the past year, from the point view of the business, Mr. To Hoai Nam, Vice Chairman and General Secretary of Vietnam Association of Small and Medium Enterprises, said that 2018 marked Government’s efforts by action. Thanks to cutting administrative procedures and business conditions in the spirit of facilitation and support for businesses, the economy in 2018 has made positive changes. The most difficultly for business was in administrative procedures, thus to remove difficulties for businesses, in 2017 and 2018, the Government had made great efforts to reform administrative procedures. This has made strong progress. Though businesses are still in difficulties and obstacles, and have more desires, in general, with the enthusiasm and determination of the Government, which has spread to the ministries, agencies and localities, this has helped the businesses remove difficulties considerably. The Ministry of Finance's efforts have been highly appreciated by society and businesses, which is reflected in the World Bank's 2018 Doing Business Report recognizing that Vietnam has a strong improvement and is ranked at 68/190 economies.

Legal regulations in the financial sector, especially in the field of tax and customs, have a great impact on businesses. Therefore, any reform or removal of barriers for market entry of businesses will greatly affect the support and facilitation for the production and business process of enterprise. Administrative procedure reforms and efforts to reduce business conditions of the Finance sector not only show the accompanying with businesses, but also contribute to improving the national competitiveness and attract foreign investment into Vietnam ...

The achieved results from the synchronous and drastic implementation of measures on policies, mechanisms and administrative procedures cuts under the direction at Resolution 35 / NQ-CP, Directive 26 / CT. -TTg (on continuing effective implementation of Resolution No. 35 / NQ-CP in the spirit of the Government accompanying with businesses in 2018) and Directive 07 / CT-TTg (on further promoting effective implementation of Resolution No. 35 / NQ-CP) by the ministries and sectors have made significant contributions to cutting costs for production and business activities, creating a transparent and convenient business environment and supporting businesses to develop and overcome hard periods. In particular, businesses are really objects to be served and facilitated to access resources to innovate and develop and become the driving force of the economy.

According to Dr. Vu Tien Loc, Chairman of Vietnam Chamber of Commerce and Industry (VCCI), if two years ago, when VCCI organized the first seminar on business conditions, many businesses said that strict business conditions were squeezing small and medium businesses, so far VCCI and the business community and associations have offered many initiatives and proposals to abolish these strict business conditions.

However, the reduction of business conditions, sub-licenses, facilitation to businesses is an arduous journey which has successes and failures. Because after we reduced business conditions, there was a period of sub- licenses growing like mushrooms. This time, the Government is more determined to make a mandatory requirement which is 50% of business conditions and specialized inspection procedures per year, this a very high political determination.

Therefore, according to the VCCI’s Chairman, the following step is the review to accelerate this process, so that the reduction of business conditions comes into reality and is not a countermeasure. This is an important requirement and the business community will accompany with the Government agencies to realize this.

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"The Prime Minister has strong guidelines for reducing business conditions, the rest is to tighten the processes for issuing new business conditions. I also suggested that except for special cases that require more business conditions, if you want to issue more business conditions and new procedures, you must cut 2 existing conditions and procedures. And the cut must be real but not for running after the movement," Mr. Loc emphasized.