Wednesday, 22 Nov 2017

New vision to support enterprises

Updated at Thursday, 08 Jun 2017, 13:21
The Hanoitimes - In recent years, the Vietnamese Government has issued Resolution No. 19/NQ-CP on improving the business environment and enhancing national competitiveness and Resolution No.35/NQ-CP on business development until 2020. The two resolutions are said to be relevant to enterprises development.
Resolution No. 19 gradually bridges the gap between the policy and practice
For 4 consecutive years (2014 - 2017), Resolution No. 19 on improving the business environment and  enhancing national competitiveness has become the “brand” of the Government. However, after four years coming into force, a large number of Res. 19 contents  remained unfulfilled and the demands of the business community are far greater than the reform scope of Res. 19. This is the reason why the government continues setting out higher and more comprehensive goals, requiring the involvement of all parties in Res. 19 of 2017 version.
In Hanoi, the City People’s Committee issued Plan No. 74/KH-UBND on implementing Res. 19 dated 6/2/2017. According to the plan, Hanoi will continue  performing the tasks and main solutions to improve the business environment and enhance the  city’s competitiveness in 2017 with a view  to 2020. Hanoi strives to be one of the leading municipalities in the application of the Electronic Government. Specifically, 40-50% of online services will beat level 3, 4 will be provided by the end of 2017.
  Online procedure will help businesses  avoid coming to  Hanoi Department of Taxation to perform tax duties. Photo: Chien Cong
Online procedure will help businesses avoid coming to Hanoi Department of Taxation to perform tax duties. Photo: Chien Cong
As one of the leading ministries in administrative reform, the Ministry of Finance has set up groups of tasks and solutions to improve the business environment and enhance national competitiveness in 2017 under the Government’s direction. It has set up 13 task groups with 36 solutions linked to 57 outputs for customs. Regarding taxation, the Ministry of Finance has identified 7 task groups with 20 solutions and 31 outputs.
The Minister of Planning and Investment has instructed the subordinate agencies to translate the tasks assigned in action plans and programs which define concrete responsibilities. In particular, the responsibilities of the leader are also identified more clearly and associated with specific targets.
Also in compliance with Resolution No. 19-2017/NQ-CP the Ministry of Science and Technology’s Action Plan includes the Project for “National Program to Support Innovative Startup Ecosystem until 2025”. It is aimed  to promote research and technology transfer and encourage enterprises of all economic sectors to participate in research, development and technological innovation.
In all, the government agencies are implementing reforms in three major areas: Institutional policies, information technology application in management and bureaucratic reforms. In this spirit, the Ministry of Industry and Trade abolished a series of cumbersome regulations, such as energy labeling before customs clearance, rice exporters plan. Although there are still a lot of tasks unfulfilled by Ministry of Industry and Trade, by abolishing the unnecessary regulations, the Ministry is showing determination to support businesses.
Speaking at a conference, Deputy Prime Minister Vu Duc Dam once required government agencies not only “support and remove obstacles” but also facilitate investment and business so as to reduce production cost and  legal risk of doing business in Vietnam. The  Res. 19 shows the Government’s new ideas and visions with strict requirements for improving institutions, business environment, enhancing national competitiveness and taking the economy into a higher stage of development.
Resolution No. 35 – A new breeze for the business community
After one year of implementation, the Resolution No. 35 is regarded as a new breeze to support production and business. The resolution is aimed at supporting and developing the business community, focusing on small and medium enterprises (SMEs) which make up  97% of the total Vietnamese businesses.
As an outcome of Res. 35, the first quarter of 2017 see  5,800 newly established enterprises in Hanoi with registered capital of 39.8 trillion dong, 12 percent higher in terms of the business capital and 7 percent higher in terms of registered capital year on year. “This figure shows Hanoi’s efforts to accelerate administrative reforms, including online business registration,” said Deputy Director of Ha Noi Department of Planning and Investment Tran Ngoc Nam. Up to now, about 68% of businesses have registered online.
Meanwhile,   Mac Quoc Anh, Vice Chairman and General Secretary of Hanoi Association of Small and Medium-sized Enterprises (Hanoisme), said that the Association was assigned to improve business environment towards fairness, friendliness and openness. In particular, as a member of the Steering Committee in charge of removing obstacles and improving the business environment of Hanoi, the Association is working closely  with the city’s departments and branches ro brief  enterprises on removing barriers of  capital, market, tax and customs procedures. The Association has met regularly with   member companies to deal with obstacles, learn about the business situation  and organize intra-trade promotion programs every month since 2016.
According to feedback from the business community, the Hanoi city’s agencies  have made progress in  administrative procedures. Public servants are becoming more helpful to businesses and their  attitude has improved. The business registration procedures have been shortened to 3 days. There have been innovations in issuing the license and certificate. In addition, the banking sector has eased loan procedures for the enterprises together with thorough assessment of business plans. Tax and customs procedures have been less cumbersome.
However, there are still lots of room for improvement.  Reform only succeeds if  public servant performs with  a good sense of responsibility and not under pressure from superior.  According to Chairman of VCCI Vu Tien Loc, socio-economic development is linked  to enterprise development and support. In broader terms, both resolutions 19 and 35 target at having  1,000,000 enterprises in operation until 2020. To achieve this goal, the Government has made important decisions: Government Creates - Government Serves - Government acts for the people and for businesses to ensure a safe and favorable business environment.
Mrs Trinh Thi Khanh, Deputy General Director of Son Ha Group:
Easing of loan conditions to support enterprises:
“I highly appreciate Resolution No. 35 because it really demonstrates the determination of the Government to improve the business environment, creating the most favorable conditions for enterprises. When Resolution 35 was promulgated, Ha Noi City swiftly comply with it by issuing measures to help businesses. The business community feel happy about the entire political and social system’s participation. This is reflected in the simpler administrative procedures, shortened business registration time, the enthusiastic, helpful and open attitude of public servants, especially the members of the one-stop shops who have direct contacs with businesses”.
Son Ha Group has encountered a lot of difficulties when the price of raw materials increased sharply and the competition in the industry became fierce.. Resolution No. 35 is the practical and timely support to the development of Son Ha Group in general and business community in particular, thereby contributing to economic growth of the whole country in general and Hanoi in particular. However, some things are hoped to be improved, specifically loan procedures are still cumbersome due to failure to reach an agreement on loan conditions between banks and businesses. If these loan procedures are simplified, it will give a big support in  capital to expand production and business.

 “Up to 80% of the tasks in Resolution No. 19 requires inter-sectoral coordination, so it is necessary to clarify the tasks and responsibilities of each ministry and branch in each indicator, business environment index and competitiveness enhancement. In reality, most indicators on Vietnam’s business environment are being improved but still more slowly than that of other countries. Consequently, it is essential to have more aggressive participation, especially at the locality.”
Phan Duc Hieu, Deputy President of the Central Institute for Economic Management (CIEM)

Resolution No. 19 addresses areas to be better improved and is a useful tool to focus on the innovation capacity and develop E-government. It shows the government effort to improve the business environment. Enterprises also have to change their minds. The  business environment improvement means the market opening with bigger competitive pressures and more competitors; therefore, enterprises must think, change and make strategies towards efficiency and competitiveness.
Jeff Roach, Australian Deputy Ambassador in Vietnam

“Hanoi City Department of Planning and Investment will accompany and support enterprises to promote their production and business activities in line with international commitments in the areas: land, capital, highly qualified human resources, market and Science and Technology application promotion. In addition to the protection of legal asset ownership and business freedom of people in accordance with the law, the creation of a safe and convenient business investment environment is necessary. Especially, in order to create a clear improvement in the implementation of the Government’s Resolution No. 35/NQ-CP on enhancing the competitiveness and increasing the Provincial Competitiveness Index (PCI),  Hanoi shall accompany enterprises, take action for enterprises and make after start-up and start-up support plans and  help enterprises to access production and business resources in 2017.”
Tran Ngoc Nam, Deputy Director of Ha Noi City Department of Planning and Investment

 “Through information learnt from enterprises, high land rent has been an obstacle that Hanoisme has reported to the Hanoi’s government. Some enterprises have been  asking for  land rent reduction. As the response, the Department of Natural Resources and Environment and the  Department of Taxation have worked with the  Hanoi City People’s Committee to remove this land obstacle. Regarding credit capital support, enterprises with loans from SHB and other commercial banks have been facilitated in credit transactions and granted preferential loans from the Bank which is a member of the Association. In addition, credit institutions in Hanoi have also accompanied enterprises, created opportunities for enterprises with feasible projects to borrow capital, create jobs and stabilize operation. In order to improve the business environment under the Resolution No. 35, through the recommendations of enterprises, I think that the administrative procedures need to be more simplified in order to facilitate the development of enterprises. In fact, many enterprises said that  regulations on specialized management of export goods and specialized examination regulations overlapped each other ...
Mac Quoc Anh, Chairman - Secretary General of the Hanoi Association of SMEs (Hanoisme)

After a year of implementation of Resolution No. 35 on supporting and developing enterprises, the business environment of Vietnam in general and Hanoi in particular has been improved significantly, basically meeting the inevitable requirements in the deep integration trend. This is indeed the “key” to solve difficulties for many businesses struggling with policies, mechanisms or administrative procedures. As a real estate investment company, after a period of bubbly market, Resolution No. 35 has helped us move forward the set fourth goals more quickly. Resolution No. 35 has not only given benefits to the enterprises but also indirectly affected the social security life of the customers. The shortening and reduction of administrative procedures, investment, issuance of the land use right certificate, hand-over of houses, etc have helped enterprises to implement projects and construction works faster. However, for more drastic development of enterprises, the whole society’s participation is very necessary. The practical meaning of Resolution No. 35 should be stepped up and close to life and parallel with enterprises.
Chairman of Board of Directors - General Director of Van Phu Investment Joint StockCompany
To Nhu Toan
Tram Anh - Khac Kien
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