Excessive red tape is often too much for local businesses to overcome

The business environment can still be improved

A workshop on “National competition policies” on October 3 featuring speakers from Vietnam’s largest business association indicates further de-regulation is needed to improve the business environment.

Dau Anh Tuan, General Director of the Legal Department under the Vietnam Chamber of Commerce and Industry (VCCI) says that the government deserves credit forimproved businesspolicies. 

Measures such as Resolution No.19 and Resolution No.35 have improved the regulatory framework and streamlined certain procedures. However, administrative procedures still deemed to be overly complicated and burdensome.

Tuan offered a few criticisms and suggestions for how the business environment might be further improved.

For one thing, relevant ministries are currently reviewing their existing policies. However, the review process lacks clear targets. Moreover, the policies they are thinking of

eliminating are ones they wrote themselves. This may not be effective. Often, the licensing agency should not and cannot be the lead agency for both drafting and cutting licensing regulations.

In other words, the effectiveness of business licenses should be independently reviewed. “The Enterprise Law Enforcement Working Group” model was quite effective in the early 2000s, but now it still has a name, but the Task Force no longer plays a major role in reviewing and evaluating licenses and business conditions.

Just implementing all the solutions mentioned in Resolution 19 issued by the Government every year can make big changes. The government also needs to strengthen the review role of independent agencies, research institutes such as CIEM, and associations like VCCI, Tuan emphasized.

Sub-licenses cause many damages

Economist Pham Chi Lan also acknowledged that many damages are caused by the existing business conditions.

Some bureaucrats are concerned for the State and desire to keep much of the State’s power. This leads to the problem, as bureaucrats may think of how to benefit themselves other than the society.

The economist recommends that the most important thing is to change the thinking about

 the role of the State in the market economy. Supervision of the State’s agencies regarding their specific functions and tasks is required.

It is necessary to strengthen the social and business supervision. However, individual agencies do not voluntarily reduce their own power. Recent improvements have mainly due to the pressure from society, public and the Government overall.