Australia supports Vietnam to add one million private enterprises by 2020

Following the previous Australian supporting programs for Vietnam such as the post-WTO accession technical assistance program (2008 - 2013); and supporting for Vietnam’s economic restructuring and capacity building plan (2014 - 2017), the Australia supports Vietnam’s economic reform program (Aus4Reform) is an initiative that builds a relationship between Australia and Vietnam to share experiences and expertise in economic development.

According to Central Institute for Economic Management (CIEM) director Nguyen Dinh Cung, this is an Australian $6.5 million program which will assist Vietnam’s government in achieving business environment and bringing Vietnam closer to the market economy.

Aus4Reform, which has been implemented for one year, is expected to produce positive results. Especially, at least additional one million formal private enterprises register by 2020 as a result of an improved and more equitable business enabling environment. 

It also helps Vietnam to increase the percentage of women-headed enterprises and accelerate growth in private sector employment and labour productivity. 

Cung highlighted that the program, alongside other international organizations, supported Vietnam in removing and simplifying 738 unnecessary business conditions in the first quarter of this year.

In addition, Vietnam climbed 14 steps in the World Bank's doing business rankings in 2017, which has been assessed as a significant improvement compared to other ASEAN countries. It also jumped five steps to be ranked the 55th out of 137 measured economies in the World Economic Forum's global competitiveness list last year. 

Noticeably, the role of women in business improved significantly with about a quarter of private sector managers being women, focusing mainly on the small and medium business sector.

However, Cung said that Vietnam has lagged behind many other economies despite the improvement in several indexes as they kept going fast; and the ones once ranked behind Vietnam has strived to improve their business environment strongly. 

Currently, Aus4Reform is following the implementation of Vietnam's Circular No. 19 and support the formation and the implementation of the Competition Law, which has been submitted to the National Assembly.

According to CIEM director, reaching the targets of Circular No.19 in the coming time is not easy. In order to rank 50th - 60th in the doing business environment, Vietnam must strive to improve many indexes.

Specifically, it must raise at least 40 steps in starting a business to rank the 83rd out of 190 economies; reduce the construction permit issuing time by 47 days to 119 days. In particular, half of the list of goods subjected to specialized inspection must be cut.

In order to enhance the efficiency of the project in the second year of implementation, policy advisor of the Aus4Reform Ray Mallon said that Aus4Reform must promote the completion of the remaining tasks of the first year; enhancing people's awareness about the benefits of economic integration and the importance of macroeconomic reform.

Besides, the program must support Vietnam in removing obstacles especially those related to the agricultural land use right, studying and assessing the impact of the economic reform on women as well as having more practical suggestions which are in line with gender issues in order to promote productivity growth.