Prime Minister Le Minh Hung (center) with cabinet officials and business leaders at a Government Standing Committee conference with the business community in Hanoi. (Photo: VGP)

Key bottlenecks facing businesses

During the first seven months of 2026, Vietnam recorded 187,200 newly established and reactivated enterprises, up 7.5% from the same period last year, averaging 26,700 per month. Of these, more than 125,900 were newly established, with total registered capital of nearly VND1,518.9 trillion (US$60.76 billion) and nearly 597,300 registered employees. Compared with the same period last year, the number of newly established enterprises increased 16.9%, registered capital rose 63.6%, while registered employment declined 10.9%. Average registered capital per newly established enterprise reached VND12.1 billion (US$484,000), up nearly 40% from 2025.

However, despite the increase in newly established enterprises and registered capital, the number of businesses exiting the market also rose. During the first seven months of 2026, approximately 155,300 enterprises withdrew from the market, up 7.6% year over year, averaging 22,200 exits per month.

These contrasting figures point to a clear reality: while Vietnam's business environment has improved, major obstacles continue to make it difficult for many enterprises to stay in operation. Addressing these challenges at their source requires removing several key bottlenecks.

At the Government Standing Committee’s conference with the business community, themed “Removing Bottlenecks - Unlocking Resources - Driving Growth,” Assoc. Prof. Dr. Ho Sy Hung, President of the Vietnam Chamber of Commerce and Industry (VCCI), said businesses remain concerned about five major issues. Institutional uncertainty has become a significant hidden cost. The most common bottleneck is the legal gap that arises when existing regulations are repealed before replacement rules take effect, compounded by frequent legal changes without adequate transition periods. As a result, businesses face a dilemma: complying without a clear legal basis or risking violations by failing to comply.

In addition, cash flow remains constrained at several stages, particularly in tax refunds. A pre-approval regulatory approach continues to increase compliance costs. At the same time, weak coordination and overlapping regulations result in repetitive administrative procedures. A single project often has to go through separate approval processes for investment, planning, land, construction, and environmental matters, without a single agency coordinating them. Digital transformation in many areas remains superficial. Resources for innovation have yet to be unlocked because practical risk-sharing mechanisms are lacking and the credit system still relies heavily on real estate collateral.

Dr. Ho Sy Hung said the business community appreciated the responsiveness and constructive approach of ministries and government agencies. Of the 53 groups of recommendations compiled by VCCI, 51 have received official responses. However, a close review shows that many of the problems lie not in policy but in implementation. For example, regarding the continued requirement to submit paper documents alongside electronic filings, the Ministry of Finance acknowledged that the law does not require this practice and said it results from the way some receiving agencies implement the regulations. Another 17 recommendations remain under review. For cross-sector issues, each ministry has responded only within its own jurisdiction, leaving businesses to piece together the answers while still caught between agencies.

VCCI President Ho Sy Hung addresses the conference, proposing a single lead agency for each issue, with one coordinated process and one clear outcome for businesses. (Photo: VGP)

Single lead agency for faster solutions

To address these issues, VCCI proposed three groups of solutions. The first focuses not only on revising policies but also on ensuring effective implementation through clear timelines and measurable outcomes. VCCI proposed assigning each of the 53 recommendation groups to a lead agency, a designated official, a deadline, and measurable results, with quarterly public progress reports. VCCI is also prepared to work with the business community to independently assess implementation progress.

The second calls for dialogue with businesses based on shared issues rather than addressing individual recommendations separately. Many recurring challenges affect a wide range of industries and have been raised by different business associations. Resolving these systemic issues one document at a time is both slow and inconsistent.

The third calls for coordinated solutions to issues that span many ministries and sectors. This is considered the most challenging category and the one that has caused the longest delays for businesses because no single ministry can resolve issues involving investment, land, planning, construction, environmental regulations, and overlapping responsibilities across ministries on its own.

VCCI proposed assigning each issue to a single lead agency responsible for resolving it, following the principle of one lead agency, one coordinated process, and one clear outcome for businesses.

In addition to these three groups of solutions, VCCI proposed accelerating implementation by dividing the 53 recommendations into three processing tracks based on urgency. The first covers issues where regulations are already in place and only implementation needs to be corrected, with completion targeted within the current quarter. The second covers issues requiring regulatory amendments, with a clear roadmap for completion within the year. The third covers complex cross-sector issues to be handled by a dedicated task force. This tiered approach would allow businesses to clearly track progress instead of waiting without knowing when their concerns will be resolved.