HANOI – With their confidence in Vietnam’s business environment badly damaged,
private entrepreneurs urged the Government to carry out reforms while ensuring
macroeconomic stability in order to overcome the current difficult situation.
This was a view shared by
representatives of business associations at the Vietnam Business Forum 2012
(VBF) in Hanoi on Monday.
SOEs: a great concern
Vu Tien Loc, president of the
Vietnam Chamber of Commerce and Industry (VCCI), said: “We recommend the
Government to prioritize institutional reform and accelerate economic
restructuring. Determination in macroeconomic stabilization and consistency in
institutional reform are prerequisites for business confidence and proper
orientation for long-term investment.”
Restructuring of State-owned
enterprises (SOEs) in recent years has suffered setbacks, he noted.
The Government should let SOEs
compete on a level-plying field with businesses in other sectors, boost
equitization, publicize information and separate State management from State
ownership, said Loc.
Kim Jung In, chairman of the
Korea Chamber of Business, said the resources of Vietnam had been mainly
allocated to the State economic sector. For instance, 70% of land, 60% of
credits and 70% of ODA have been given to businesses in this sector.
“We propose the Government
radically restructure SOEs,” he said.
On behalf of the Government,
Deputy Prime Minister Vu Van Ninh replied the Government is resolute in SOE
restructuring. “We will retain a few SOEs, the others will be equitized by
2020,” he committed.
Falling confidence
Business confidence has plunged
to the lowest level since 2005, said Loc, citing the data VCCI collected for
the provincial competitiveness report.
Specifically, only 33% of the
surveyed enterprises were optimistic about the business outlook in 2012, versus
47% in 2011 and the average percentage of 70% in the years before that.
Preben Hjortlund, chairman of the
European Chamber of Commerce in Vietnam (EuroCham), added that confidence among
800 EuroCham members had hit the bottom, falling to 45 points from 75 points in
the fourth quarter of 2010.
“We are more concerned about
current business situation, future outlook, impacts of tax and penalty increase
and supervision of State agencies,” he said.
Meanwhile, Christopher Twomey,
chairman of the Amercian Chamber of Commerce in Vietnam (AmCham), stressed the
Government wanted to take control of many things, such as which items can be
imported, who can work in Vietnam or which programs can be broadcast on TV. All
of these make foreign investors feel that they are not welcomed in Vietnam.
“The Government’s effort to
manage business activities is the reason why many investors give a second
thought to doing business and expanding operations in Vietnam,” said Twomey.
“Vietnam must strengthen
competitiveness in foreign investment attraction,” he underscored.
He said the Government would soon
recognize local businesses and SOEs could not raise salary by 20-30% every
year, suggesting a pay hike of 15% per year in the next three years.
Government’s commitment
Deputy Prime Minister Vu Van Ninh
said many business associations had submitted petitions saying that they could
only afford a salary increase of 18% per year, not 22-25% as proposed by the
Government.
The Government has accepted this
rate, said Ninh, adding that the extra salary sums account for less than 1% of
business cost.
He vowed to suggest corporate
income tax reduction to the National Assembly in 2013.
In the middle and long term, the
Government will focus on economic restructuring and mobilize all resources for
rapid and sustainable growth. In the short term, the Government prioritizes
inflation restraint and macroeconomic stabilization, said the deputy prime
minister.
“We consider difficulties and
successes of enterprises as our own difficulties and successes,” he stated.
Tu Hoang - The Saigon Times Daily
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