Dec 4, 2012

Vietnam - VBF’s eloquent private sector thoughts

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The bi-annual Vietnam Business Forum (VBF), a dialogue between the government and the private sector, will take place this week in Hanoi. VIR talks with Alain Cany, co-chairman of the VBF’s management board, on what can be expected from this high-profile forum this year.

What is the main focus of the VBF, which will be held as a backdrop to the Consultative Group (CG) meeting of donors?

With the theme of “Restoring Economic Dynamism,” the forum this year will be dedicated to banking and capital markets, investment and trade/tax, infrastructure/port, the auto sector and tourism.

As usual, the annual forum will be started with the review of investment climate where the private sector recognises the efforts of the government in taking appropriate short-term policies focusing on stability, which has been resulted in a number of noticed outcomes. Nevertheless, I believe that the approach should be implemented on a temporary basis and deeper structural reform implemented simultaneously.

The forum will be also highlighted with reports from the main working groups of banking, capital market, investment and trade, and infrastructure with focus on solutions to unblock the bottlenecks in current business environment. In other words, measures for resolving inventory in manufacturing and real estate, recommendations on tax policy, suggestions on developing supportive industries shall be made available.

What are the new elements of the coming forum compared with the previous ones?

The Automotive Working Group will have its report presented for the first time. We will also renovate the banking session with the presentations from four foreign banks in Vietnam, namely Standard Chartered, ANZ, CitiBank and HSBC. They will deliver an overview of current banking system and necessary first steps, progress on structural and regulatory reform of the banking industry, recommendations on management of bad loans and sources of funding; and recapitalisation of banks and proposal to avoid repeating past mistakes, respectively.

Another highlight of the VBF this year is the VBF Book, which will exhibit full reports of the eight Working Groups under the VBF framework. The online book will be accessible at the Forum on December 3, 2012 where a workstation is arranged for visitors to explore new functionalities of the new VBF website.

Could you highlight some progress during the past 10 months since the transition of the coordination role from International Finance Corporation (IFC) to the VBF consortium of 14 local and international business associations and chambers of commerce in February, 2012.

Great progress has already been made on a number of fronts with government counterparts since the working mechanism was innovated.

As the forum is going through a new level, the VBF Consortium decided to take the initiative of the development of a new VBF identity. The design exhibits the spirit of building a boundless platform for dialogue between the Vietnamese government and the business community to unlock infinite possibilities and opportunities.

Also, the VBF website at has been upgraded. In particular, the VBF website will serve as a platform bringing all VBF members, their respective skills and information to a central place. This will provide comprehensive information to all members, building responsive, interactive and effective tools to facilitate better transparency and information exchange and communication processes between VBF and its members as well as members between themselves and creating a private area for members of each different working group.

What is your perspective of the current macroeconomic situation?

Since the mid-year, significant progress has been made regarding macroeconomic management such as the stability of the currency, the reduction in inflation more rapid than anticipated and interest rates having fallen, the improved trade balance and increased foreign currency reserves.

However, we still face economic challenges. We believe that an open and constructive dialogue with the government is even more important than ever. Domestic improvements in state-private sector collaboration should help restore efficient and smooth administration and a business friendly legal environment.

From the perspective of the local business community, “The crucial issue now is to restore the confidence of and identify proper directions for enterprises”, I quote the statement of my VBF co-chair Vu Tien Loc. In this connection, a master plan for development of businesses in the coming time should be in place.

This should base on three main pillars - continuous macroeconomic stability and market-oriented institutional reforms for a equal, transparent and predictable business environment; supportive measures to help enterprises overcome the current challenging time; and facilitation for improvement of business competitiveness and corporate governance.

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