However, the report also reveals that certain regulations remain inflexible, and some amendments are still superficial, lagging behind real-world developments and failing to truly facilitate business activities.
Bottlenecks persist
According to the VCCI report, Viet Nam’s GDP grew by 7.09% in 2024, placing the country among the fastest-growing economies in the region. Nonetheless, enterprises continue to grapple with numerous institutional and market challenges, including rising production costs, sluggish consumer demand, and unresolved issues related to labour and capital.
Against this backdrop, the National Assembly passed 31 laws, while the Government issued 182 decrees and various ministries promulgated 629 circulars. This reflects an almost twofold increase in legislative activity compared to 2023. There has also been a prioritisation of omnibus laws that amend multiple existing ones. Many legal documents have been revised to streamline procedures, reduce compliance costs, and further decentralise power to local authorities.
Yet, many regulations remain rigid and prescriptive, complicating business operations. Certain procedures are still time-consuming due to a lack of coordination between agencies. Although tax and financial policies have seen some improvements—such as tax exemptions and reductions—businesses continue to complain about high compliance costs and overlapping rules.
Green transition policies, including packaging recycling responsibilities, are receiving more attention. However, businesses report difficulties stemming from high costs and an unclear legal framework. Notably, while e-commerce is expanding rapidly, the legal system has yet to catch up, particularly regarding small-scale individual sellers operating online.
Nguyen Hong Uy, Head of the Nutritional Foods Group Sector Committee at the European Chamber of Commerce in Viet Nam (EuroCham), raised a concerning issue: the dominance of a “pre-inspection” mindset in many regulations. According to Uy, regarding conformity announcement regulations: “The focus on verifying paperwork before products are allowed to circulate creates loopholes for fraud. The recent discovery of 573 counterfeit milk brands with valid conformity documents by enforcement agencies highlights the urgent need to shift toward post-inspection to better protect consumers.”
Tran Thanh Phuong, Director of ExtendMax Viet Nam Co., Ltd., noted that the cost of testing and certifying 5G phones before 2022 was around 70 million VND (2,700 USD), but this surged to 3 billion VND (115,100 USD) at one point after 2022 and now stabilises at around 1 billion VND (38,400 USD) per product. Such steep compliance costs relative to the market size have become a “barrier,” prompting several companies in 2023 to reduce their 5G phone product lines by a third compared to 2022.
Finding solutions rooted in reality
According to the Government Office, between 2021 and early 2025, ministries and agencies have eliminated or simplified 3,195 business regulations across 281 legal documents out of a total of 15,763, achieving a reduction rate of 20.2%.
Additionally, in the past year alone, 172 administrative procedures across 32 legal documents were decentralised. During the 2022–2024 period, 19 out of 21 ministries and agencies decentralised 328 out of 699 procedures across 65 legal documents. However, economic experts have observed that more thorough categorisation of proposals for simplification is needed to assess their true impact. Post-decentralisation, procedures often remain unchanged, with no significant reduction in intermediate steps or processing time.
VCCI Chairman Pham Tan Cong stressed the importance of shifting from a “pre-inspection” to a “post-inspection” approach to reduce the regulatory burden on businesses and encourage innovation. He called for a more coherent legal framework, particularly in areas such as e-commerce and the green transition, and urged greater business involvement in policy formulation—from initial feedback to detailed critiques.
Businesses should be regarded as partners in policymaking rather than merely subjects of regulation. This partnership is vital to ensuring policies are closely aligned with practical needs.
