Report on performance results of the Government's Resolution No. 35 / NQ-CP on enterprises support and development till 2020

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Independence - Freedom - Happiness

No:   1114   /PTM – VP Ha Noi, May  15,  2017



performance results of the Government's Resolution No. 35 / NQ-CP on enterprisessupport and development till 2020


ToThe Government’s Office


  To implement the Official Letter No. 4220 / VPCP-DMDN dated April 25, 2017 and Official Letter No. 4319 / VPCP-DMDN dated April 27, 2017 of the Government’s Office, in order to prepare for the conference of the Prime Minister meeting enterprises and to review the implementation of Resolution No. 35 / NQ-CP (hereinafter referred to as the Resolution) for the implementation of Resolution No. 35 / NQ-CP) as follows:


 Immediately after the promulgation of the Resolution, many ministries and localities have soon developed action plans and held meetings on implementation of resolution such as Hanoi City, Ho Chi Minh City, Da Nang, Quang Ninh, Lam Dong and Hoa Binh Provinces. Until the present, all ministries and localities have issued the program, action plan and implementation of the resolution.

 The Vietnam Chamber of Commerce and Industry (VCCI) held a meeting to disseminate and thoroughly understand the Resolution and at the same time to develop the Action Plan of VCCI to implement the Resolution (Decision No. 1773 / PTM-VP dated July 25, 2016). of VCCI’s President). VCCI's action plan has focused on six major tasks andsolutions as well as 44 specific activities to implement the Resolution.

Through the implementation of the resolution of ministries, localities, VCCI, business associations and the business community, it has been recognized that:

   - The resolution has created a positive response of ministries, localities, the business community and the whole society. The business community appreciates, responds positively and expects the Resolution to come into life, creating real favorable conditions for enterprises to develop.

- Most Action Plans closely follow the tasks assigned by the Government in Resolution 35 / NQ-CP and some PAR targets mentioned in Resolution 19 / NQ-CP. The Action Plans have detailed plans for specific activities to implement tasks and solutions with specific time to complete activities. However, most Action Programs have implemented the Resolution that do not specify sanctions in case activities are not implemented or implemented ineffectively.

 - Besides many ministries and localities have deployed early, effectively, and drasticly. There are still many ministries and localities, the ministries, branches that have been lately implemented or formally implemented the resolution. This leads to a "top-hotting " but "under-cooling" situation that reduces the effectiveness and impact of the Resolution on the business environment and supports business development in a timely manner.

- Some provinces and cities have not clearly defined the time for implementation of the action program.. Most provinces have not appreciated the role of the Fatherland Front, business associations, mass organizations and professional societies.


  Resolution 35 assigned VCCI 05 groups of tasks and a number of coordination tasks, particularly:

           - To synthesize the recommendations, difficulties and problems of enterprises to transfer to the State agencies for handling and settlement; Monthly report to the Government’s Prime Minister and quarterly report to the Government on the situation and results of implementation; to publish on the website of VCCI

          - Generalized the implementation of commitments signed between the People's Committees of provinces and cities under the Central Government, reported to the Government’s Prime Minister quarterly and publicly on the website of VCCI.

       - Organized the investigation, statistics and synthesis of official and informal expenses for enterprises, compared them with regional and international enterprises and propose solutions to reduce expenses for enterprises.

           - Developped feasible programs and measures to further improve the quality of activities, to well performed the role of political and social-professional organizations of the business community, businessmen and users. labor.

          - Developped and implement programs and projects to support the competitiveness of enterprises, programs to improve the capacity of business associations.

Until the present, VCCI has implemented 5/5 assigned tasks and coordinated with other ministries, localities, business associations and the business community to implement the solutions set out in the resolution. The tasks assigned by VCCI in the resolution are also regular tasks in accordance with the functions and duties of VCCI as stipulated in the Charter of VCCI approved by the Government’s Prime Minister.

          2.1. Summary on the difficulties, obstacles and proposals of enterprises:

In order to perform the above tasks, from the Prime Minister's meeting with enterprises that held on April 29, 2016 to the end of January 2017, VCCI collected 421 recommendations from enterprises and associations and send them to ministries, branches and localities for response and settlement. In which, there were 320 submitted by the VCCI and sent to the ministries and agencies at the Conference. The remaining 101 recommendations were included in VCCI's monthly reports to the Government’s Prime Minister. The implementation results of the resolution are as follows:

          - Ministries, branchess and localities have dealt with 380 requests (reaching 90.3%), while 43 other recommendations related to proposals for amendment  and supplement of laws, policies and General issues have been acknowledged and further studied for resolution.

           - In preparation for the meeting of the Prime Minister to meet enterprises and to preliminarily review the implementation of Resolution No. 35 / NQ-CP for 1 year, from February 2017, VCCI has collected 188 new proposals from businesses and unions, business associations and transferred the ministries, localities for settlement. Ministries have responded 98 responses (reaching 52.1%), 90 recommendation have not been responded, including some proposals under the jurisdiction of the Government.

         - The system of receiving and processing feedbacks and recommendations of enterprises on the Government Information Portal operated by the Office of the Government ( since its establishment and operation (October / 2016) has also received and transferred to ministries and localities 489 recommendations from enterprises and business associations (not included 97 reflected recommendations, the remainingrecommendations fall under the jurisdiction of the Government’s Prime Minister or must solve according to complaint and denunciations processes  that have also been submitted to the Government’s Prime Minister for resolution as stipulated), in which, there are  372 recommendations that were handled, resolved and responded (76.1%).

Thus, since the meeting of the Prime Minister of the Government meeting with businesses in April 2016 up to now, there have been over 1098 recommendations of the business community have been received and transferred to state agencies and there are 850 recommendations that were handled, resolved and responded, reaching the rate of 77.4%. The recommendations have not been considered and resolved, they are mainly general recommendations on business environment, administrative procedure reforms, amendment of laws, mechanisms and policies that are being continued study and resolution by ministries and localities.

The main contents of the business community are summarized in the following groups:

+ Regarding administrative reforms and creaeve favorable conditions for enterprises: To focus on improving tax and customs procedures, access to land, inspection, examination of environment; spirit and attitude of civil servants who are working in the above fields; to require state agencies to comply with the law, as well as businesses.

+ To create a favorable environment to support enterprises in innovation: To focus on promoting the efficiency of the national scientific and technological development funds; National Technology Innovation Fund, SMEs Development Fund, etc.

Regarding the assurance of business rights, equal access to resources and business opportunities of enterprises: Recommendations are related to the proposal for serious implementation of the consultation of the impacted subjects and specialized  experts in the process of formulation and implementation of laws and policies; to strengthen the quality and involvement of law enforcement officers in developing laws; Concerned discrimination among businesses and business associations; Contradictions, overlapping  among legal provisions.

Regarding reduction of business expenses for enterprises: To focus on ensuring the appropriate interest rates; to reduce the contribution rates of the employer; to reduce land rental, to reduce  charge rates in some BOT projects, other fees and charges.

+Regarding protection of the legitimate rights and interests of enterprises: Recommendations on issues related to the protection of enterprises' interests when carrying out bankruptcy procedures of enterprises; To execute civil judgments, especially when disputes arise between enterprises and farmers; to have strong sanctions to deter unfair competition behaviors, IPR infringement; to protect  businesses in industrial relations; to inspect and check contravention of regulations.

       2.2 Summary on the implementation of commitments with the provincial / municipal People's Committees on the business environment:

 Resolution 35 / NQ-CP assigned the People's Committee of the city: "In the third quarter of 2016, the Chairman of the People's Committee of provinces and cities under the Central Government signed a commitment with the Chamber of Commerce and Industry of Vietnam, There is a witness of the Steering Committee for Enterprise Renovation and Development on creating a favorable business environment for enterprises. " At the same time, assigned VCCI the following tasks: " generalizing the implementation of commitments signed between the provincial / municipal People's Committees and the Vietnam Chamber of Commerce and Industry, report them quarterly and publicly on the E-portal  of VCCI

In addition to the two commitments signed by the People's Committees of Hanoi and Ho Chi Minh City with VCCI at the Prime Minister's Meeting with businesses, in August and September 2016, VCCI held two popular conferences, fully grasped the Resolution 35 / NQ-CP and signed a commitment with VCCI to create a favorable business environment to support businesses in Hanoi and Ho Chi Minh Cities. Thereby, completion of the signing commitments with all 63 People's Committee of provinces and cities in the country on time.

In addition to commitments under the tasks assigned in Resolution 35, provinces and cities have made quantitative commitments such as enterprise development targets up to 2020, targets of administrative reforms in the specific areas such as the registration time of enterprises establishment, the time for settling investment procedures, the granting of construction permits, the granting of land use certificates, tax and customs procedures, application of information technology, capacity building enhancement of PCI provincial competitiveness ... The criteria for customs clearance reduced from 30 to 50% compared to today.

Particularly, the target of developing enterprises,-in 63 provinces and cities nationwide, has registered to develop 1,469,070 enterprises by 2020.

 Through monitoring the implementation of commitments and reports of the provincial People's Committees, there are some outstanding results and limitations as follows:

2.2.1. Outstanding results:

- The implementation of Resolution 35 has made positive changes in the thought and awareness of the cadres and civil servants at all levels of local government, especially in terms of style, attitude and service attitude. Business development, investment attraction has been interested in localities. Business activities such as training, trade promotion, credit guarantee, business incubation ... have been implemented and received a positive response from the business community.

- The reform of administrative procedures in many localities has achieved good results, there are some administrative procedures in excess of the targets set by the Resolution 19 / NQ-CP and commitments signed with VCCI such as: Businesses establishment time: Most provinces are 2 days (1 day reduction compared to Commitments). There are provinces only 1.5 - 1.84 days as Dong Nai Province (1.84), Lai Chau Province (1.5), Hau Giang Province (1.5), Ha Tinh Province (1.66); clearance period: most of the provinces met Resolution 19 and the set forth commitments are: time of crossing border is less than 10 days for export goods; For import goods are less than 12 days, in which there are many provinces exceeded the norms of high level as Quang Ninh Province reaches: 21 hours 34 minutes 12 seconds for export goods and 39 hours 45 minutes 12 seconds for import goods, Ha Tinh Province: Reachin 4 days 12 hours for imported goods and reachin 1 day 12 hours 52 minutes for export goods; ...

- The model of public administrative center is organized by many provinces to minimize travel time and inconvenience for people and enterprises. Some provinces such as Quang Ninh has built a public administrative center to the district level. In addition, all localities have implemented the one-stop-shop and interconnection one-stop-shoppping in handling administrative procedures for people and enterprises.

- The provinces have actively implemented electronic tax declaration (96-100%), especially in Dong Nai, Quang Tri and Gia Lai provinces (100%), Binh Thuan  Province (99.84%), Ho Chi Minh City (99.37%), Can Tho Province (99.51%), Hung Yen Province (99.6%), Ha Tinh Province (99%).

- The organization of dialogue among the all level of authorities with businesses are interested in most localities. Many localities have had a lot of creativity in organizing dialogues with enterprises such as organizing dialogues by type of enterprises (small enterprises, FDI enterprises according to each country), dialogues on television ... especially, the model of "Businessmen Coffee" is organized by many provinces to create a friendly atmosphere among authorities and enterprises in dialogue and solve difficulties and obstacles for enterprises.

2.2.2. Exist and limitation problems:

- The reform of administrative procedures, although being well implemented,but it has not yet met the requirements of enterprises and investors. A part of cadres, employees and public servants who are responsible for solving administrative procedures for enterprises and investors with have limited qualifications and capacities; the troublesome is still happening, causing annoyance for the business.

- Some provincial people's committees have not yet ensured that the dialogue with enterprises is made publicly at least twice a year.

- The localities have paid more attention to get comments of enterprises on legal documents under the jurisdiction of the locality. However, it has just popularized  the form of getting comments on websites of provinces, have  not diversified the forms of soliciting comments of enterprises.

- Businesses support activities have been strengthened but they have not met needs of enterprises. Businesses complains that administrative procedures are slow, causing difficulties and troubles for enterprises. Many localities have not met the requirements of inspection and examination once a year as Resolution 35 set out. The businesses have to receive 6-7 inspection and auditing teams, even over 10 delegations of inspection and auditing that not mentioned  the informal inspections. On the other hand, there are many businesses have comments on the tax comparison, error due to software updates causing the status  that businesses have paid taxes but still be reported as tax debt.

- On the target of developing businesses to achieve the Government's objectives by 2020, there is 1 million businesses which operate effectively: This is a necessary goal for the development of the Vietnamese business community. However, this can easily lead to the achievement of local authorities. Some provinces have also confused the criteria of enterprises to operate effectively with the registration criteria for the establishment of new businesses, others did not specify the number of specific businesses but only register targets in a general way the number of enterprises by 2020, the number of enterprises will be doubled..

- The application of information technology at level 3, level 4 in solving administrative procedures in some areas related to enterprises is still slow. The number of administrative procedures provided online levels 3 and 4 is very small.

- Local authorities, such as provincial departments, People's committees at all levels, have not actively checked and grasped the difficulties and obstacles faced by enterprises, so they have not yet come up with concrete and timely solutions to support the business.

- Although many localities have paid attention to directing the labor training in their localities, they have not met the demand of enterprises, especially enterprises that have high labor demand, but localities have not met enterprises have to train themselves. On the other hand, the perception of a part of cadres, laborers on vocational training and vocational training for employees has not been respected.

- The reform of the settlement of civil, business and commercial disputes related to the business of the courts at all levels has been slow and prolonged, making enterprises less selective in solving cases when there are disputes. The court's resolution of business bankruptcy is not much and generally the work of civil judgment is very necessary to continue improving the implementation time and efficiency.

- Few businesses use online question and answer channels on local portals when there are obstacles, difficulties and recommendations. The main reason is that responses are not timely, be lack of specific; the technology of portals is backward; some of the information pages are only formal, not updated and poor information.

- The Association and the business community also have little practical activities to implement Resolution 35 / NQ-CP, less reflect difficulties and problems for state agencies. Reasons are because of responses, settlement of the business proposal are late, or are not answered. On the other hand, some businesses still have the habit of dealing with difficulties, problems in the informal way, based on relationships.

 2.3. Organizing surveys, statistics, synthesizing formal and informal expenses for enterprises, comparing with regional and international enterprises, and proposing solutions of costs reduction for enterprises:

In order to make statistics on business costs and especially compare with other countries in the region and in the world, the study of business costs in Vietnam should apply methods that be  internationally used. VCCI has conducted a research on business costs such as Business Surveys, Business Expenditure Survey, Business Performance Survey and Investment Climate, Business Environment Survey. The World Bank's Global Business Index (GERA) Global Competitiveness Research Initiative (GERA), World Economic Forum's Global Competitiveness Index (GCI). Not all of the above studies, however, can help showing the current picture of costs of doing business in each country and making comparisons between countries.

Among the above studies, the World Bank's "Business Environment Survey" examines the most costly business issues. According to the 2017 report, costs of doing business in Vietnam are substantially higher than that of other countries in the same region, such as Singapore or Malaysia. Especially, Vietnam's access to electricity is nearly 49 times higher than that of the Philippines. Costs of paying taxes are highest compared to ASEAN 4, at 39.1% of profit, twice as high as Singapore. Similarly, costs of adherence to export vouchers are also highest, almost four times higher than that of Singapore and more than three times that of the Philippines. This is a very important issue because it reduces the competitiveness of Vietnamese enterprises.

Other issues related to costs are also a great concern:

• Regarding logistics costs: Logistics costs are still take a high proportion of the cost structure of enterprises in Vietnam. For example, the cost of transporting a container from Haiphong to Hanoi or vice versa (about 100km) is three times more expensive than the cost of transporting one container from China and Korea to Vietnam. There are also costs incurred that related to administrative procedures, payment of fees, delayed time, increased petrol prices, additional shipping costs ... The other issues related to cost also cause great concerns: they are:

  • Regarding import and export tax: The effect of new import tax rates on plastic materials manufacturing companies is subject to new import tax rates which have tripled since January 1, 2017, the import tax rate of PP plastic to 3% directly affects the cost structure of products and indirectly affect the competitiveness of enterprises.
  • Loan Costs: The problem that emerges are the risk of loan, especially the short-term debt. From the point of view of the loaning banks, in order to ensure a more competitive price policy, there is a transcription in the structure of short-term is loans (business aid) to increase the long term loan ratio aimed to stabilize the interest expense ceiling.
  • The cost of renting a domestic business premises is too high, it causes difficulties for SMEs. Most medium and small-scale enterprises in Vietnam are unable to afford high fees to lease premises that are in a favorable position and are inferior to their international counterparts who are reputation, experience, have stronger financial strength. Space rent is the reason that leading to the chain of domestic restaurants, food service and retailing is much less inferior than most foreign retail chains.
  • Labor costs: According to the report on "Survey of Manufacturing Practices of Japanese Firms in Asia and Oceania in 2016" by the Japan External Trade Organization (JETRO) announced on January 14 /2017 in Hanoi showed that there are nearly 60% of businesses worried about rising labor costs in Vietnam. Compared to many countries and within ASEAN, Vietnam is having a highest social insurance premiums rate. Viet Nam has stipulated social insurance premium rate at 32.5% of the monthly salary, in which there is 22% is paid by the company and 10.5% is paid by employees.
  •  Meanwhile, Malaysia only pays for social insurance 13%, Philippines: 10%, Indonesia: 8%. The rate of social insurance between the enterprise and workers in Vietnam is also very different, while many countries require businesses and employees to be equal, each side 50%. What is mentioning is that at such costs, it requires employees to create a certain value for the new business can survive, that is, labor productivity must reach a high enough level. Meanwhile, according to research by the World Labor Organization, Vietnam's labor productivity is nearly 16 times lower than that of Singapore, 11 times lower than that of Japan and 10 times by South Korea. However the low labor productivity is clearly not complete within the control of the business.
  • About informal expenses: According to the VCCI PCI-2016 provincial competitiveness index report, there was 66% of the 11,000 enterprises surveyed have confirmed this fee. Overall, the situation has not improved over the years.
  • Overall, the situation has not improved over the years. There was from 9 to 11 percent of businesses surveyed from 2014 to 2016 and reported that costs for this item accounted for more than 10 percent of their total revenue, be much higher than the 6-8 percent for the five years before. The situation of harassment when handling business procedures is still widespread, although this has improved in the last two years (down from 65% in 2013-2014 to 58% in 2016) but it is still high compared to the results of Investigation of the previous years. Enterprises often have to pay unofficial fees when carrying out procedures for granting business premises, receiving inspection, examination and procedures for granting conditional business licenses.

At present, VCCI is continuing to conduct independent and comprehensive research to provide a more comprehensive picture of this content.

2.4. Developping specific programs and measures to improve the quality of VCCI's activities, to well perform the role of a professional social organization of the business community, businessmen and employers in Vietnam:

Based on the functions and duties stipulated in the Charter of VCCI approved by the Prime Minister (Decision No. 2177 / QD-TTg dated November 11, 2017 of the Prime Minister) , policies of the Party and the State for economic development, enterprise development, building businessmen stated in the Resolution of the 11th Congress and Resolution No. 09 / NQ-TU of the Politburo on construction and bringing into play the role of Vietnamese businessmen in the period of accelerating industrialization, modernization and international integration together with the grasp of the demand and development level of enterprises, VCCI has determined the direction, the key tasks in the 2015-2020 period which are:  “To focus on well performance of the role of the national organization representing and protecting the business community, business associations, businessmen and employers and socio-political- organization of the Party and State; To effectively advise the Party and the State on socio-economic policies, to create a favorable business environment for the development of enterprises; to promote and support the development of enterprises and businessmen in the process of restructure the renewal of the model of economic growth and international integration in the direction of raising the quality, efficiency and sustainability.

In order to implement the above-mentioned tasks and orientations, VCCI has focused on the following programs and tasks:

- To coordinate with the Central People Commission, Provincial Party Committee,   Municipal Committee, Party Civil Affairs committee of Party Committee for organizing the business community and businessmen's resolutions No. 09-NQ / TU by the Politburo on development and promotion the role of Vietnamese businessmen in the period of accelerating industrialization, modernization and international integration.

- To assist enterprises to restructure through the implementation of national programs and projects to support enterprises and entrepreneurs such as training enterprises and entrepreneurs; to improve competitiveness and support international integration; to perform the function of representing the employers, honoring and rewarding enterprises and entrepreneurs.

- To implement activities to promote the improvement of the business environment, especially the business environment in localities through the following activities: Building and providing comments on policies, promoting administrative reform to ensure a fair and transparent business environment, to ensure a prevention of corruption; to formulate and implement Corporate Integrity Scheme; to summarize the economic development, enterprise development, international economic integration; to improve the quality of annual reports such as PCI Report, MEI, Annual Business Report, Labor Relations Report, Sustainable Development Report ... To improve and standardize investigation activities, periodic business movement survey of VCCI to form an important reference tool. To cooperate and support ministries and localities in implementing administrative reforms and improving their economic governance capacity to better serve the needs of the people and enterprises.

- To participate in developing and completing the legal framework and policies on business associations. To support the establishment and connection of business associations, to ensure the synergy of the whole system of associations by industry and geographical area. To develop and implement a program to support a capacity building of business associations. To establish a unified business association system in all provinces and cities throughout the country.

- To perform well the role of the employers’ representatives at the national level. To continue to authorize and coordinate with business associations in performing the function of representing employers in localities and trades. To continue implementing programs and projects to provide practical and effective support to employers. To coordinate proposals and implement measures to prevent and solve labor disputes arisen, to develop a harmonious industrial relations.

- To expand and improve the quality of trade promotion and investment, to develop business opportunities for enterprises, and to strengthen the system of business support services. To continue taking initiative in participation and promotion well of the role of chairing and managing international organizations, large business forums of business circles, to participate in consultancy, to promote the negotiation, to sign implementation of bilateral and multilateral trade agreements. To step up the support for international integration enterprises, to deal with trade barriers in the process of international market penetration and anti-dumping lawsuits and at the same time to formulate mechanisms for safeguarding the protection of the market and domestic enterprises in accordance with WTO rules.

- To strengthen resources of VCCI to meet the requirements of tasks in the new phase. To build up an effective organizational network of the Executive Committee and VCCI in the domestic and international.

The above-mentioned programs and tasks are actively and effectively carried out by the Party and State agencies and at the same time receive positive cooperation from the domestic and international business community. .

2.5. Developping and implementing programs and projects on supporting the competitiveness of enterprises, the program on improving the capacity of business associations:

Although it is the task assigned in Resolution 35, it is in fact the political task of VCCI that has been implemented for many years. In 2016, VCCI coordinated with other ministries, localities, business associations and the business community to carry out this task, to focus on accelerating the implementation of groups of tasks and solutions of the Resolution as follows:

2.5.1. Regarding administrative reforms  and  creating  favorable conditions for enterprises:

To implement an Action Program on implementing the Government's Resolution 19 / NQ-CP on tasks and measures to improve the business environment and enhance the national competitiveness in 2016-2017, In 2016, VCCI developed a VCCI Action Plan and reported to the Government on the implementation of the Resolution with two main themes: (1) improved the national business environment. (2) Activities of supporting enterprises in  improving productivity, competitiveness and sustainable development such as the project to improve the productivity of enterprises; a program on evaluating and ranking sustainable enterprises in Vietnam; an action program on promoting integrity in business (Scheme 12); "Green Code Initiative in Vietnam"; a capacity building project for business associations…

VCCI has also implemented the contents of the cooperation agreement among VCCI and the General Department of Customs, the General Department of Taxation, implementation and evaluation of effectiveness of administrative procedure reforms, Annual meeting of dialogues on tax and customs matters to solve difficulties and problems for enterprises. The Chairman of VCCI joins the Steering Committee to implement the coordination Program to supervise the implementation of major tasks and solutions to improve the business environment and raise the national competitiveness in the tax and customs fields. the Joint Program on monitoring the implementation of major tasks and solutions to improve business environment and enhance national competitiveness in the Field of Tax and Customs with the Alliance of 06 members: The Central Vietnam Fatherland Front, The Ministry of Finance, VCCI, Vietnam Cooperative Alliance, Vietnam Association of Small and Medium Enterprises, Young Entrepreneurs Association of Vietnam. To perform assigned tasks as Vice Chairman of the Administrative Reform Advisory Council of the Prime Minister, VCCI has developed and implemented the plan of Board I. In 2016, to implement administrative reforms in access to electricity, taxation and customs.

In the area of legal development, VCCI has participated in 30 boards, has edited 6 laws, 1 ordinance, 22 decrees; has participated in the review of 24 laws and decrees; has collected opinions of enterprises to complete 148 drafts of legal documents. Especially, VCCI has focused on improving the business conditions to implement the provisions of the Investment Law 2014, has made suggestions on modifying the list of conditional business lines of the Investment Law.

VCCI has researched and developed in-depth reports on business capability, business environment and business development in Vietnam, and updated business profile of the company including: Publication and announcement  "2015 Vietnam Business Annual Report " with the theme "Business Development Services", “2016 Vietnam Business Annual Report”, the theme "Corporate Governance". In addition, VCCI has also developed a number of research topics such as tax administration policy for business households in Vietnam; mergers and acquisitions, development trends and policies in Vietnam; Information aggregation, publication of release on entrepreneurs and institutions ...

To perform the task of organizing and coordinating the organization of dialogue among enterprises and authorities at the central level, in the year 2016 at the central level, VCCI participated in organizing the conference in April 29, 2004, co-hosted the Vietnam Business Forum held annually in June and December each year, organized 03 business dialogues taxation, customs and social insurance in Hanoi and Ho Chi Minh Cities.

At the local level, VCCI has organized and co-organized hundreds of conferences, seminars, dialogues, meetings, business contacts to remove difficulties, obstacles for enterprises, promote investment in localities.

2.5.2. Creating a favorable environment for supporting start-up businesses, innovative enterprises:

VCCI is a pioneer in start-up business activities in Vietnam. Movements, programs and start-up activities conducted by VCCI over the past 15 years have contributed significantly to building a team of Vietnamese entrepreneurs to support activities for 2016 start-up continue to be promoted with many practical content:

- Organizied the launching 2016 startup program and exchanging start-up businesses to create opportunities for exchanges and sharing of experiences on entrepreneurship, career development and arouse the spirit of entrepreneurship among young people. Many entrepreneurs pledged financial support or training courses for students to attend and exchange. Also at the exchanges, the organizing Committee signed cooperation agreements between units to promote the coordination between the organization board - school - business associations jointly deploying the effective startup program.

- At the local level, VCCI has organized and co-organized hundreds of conferences, seminars, dialogues, meetings, business contacts to remove difficulties, obstacles for enterprises, promote investment in localities.

- Microsoft's "Youth spark" program kicked off the youth movement in vocational schools. Scheme on "Enhancing working skills, starting-up for youth and connecting with SMEs"; The program "popularizing business knowledge, supporting individual business households in development into enterprises, rapidly increasing the number of medium and large enterprises", contributed to raise the number of start-up enterprises, encouraged individual business households to develops into an enterprise.

 - As the national focal point of the Global Initiative Network (VCCI), VCCI organized many activities associated with this network, has expanded the playing field for startups, most notably the event was held in the framework of Global Business Week (GEW) in mid-November in Ho Chi Minh City. With this model, VCCI started to form Vietnam's start-up network (GEN - Vietnam) and was launched on March 1, 2017.

In support of business innovation, within the framework of the National Technology Innovation Program up to 2020, VCCI conducted a training needs assessment on technology management, technology management and technology update through a survey and investigation of 2100 enterprises and business development service providers. This is the basis for VCCI to propose to the Ministry of Science and Technology to set up training programs and support enterprises in the fields of technology management, and technology update. At the same time, VCCI has also set up a website to connect enterprises' needs for technology innovation’s  support with support service providers.

In addition, as a member of the Executive Board of the "Innovative Ecosystem Initiative Project", VCCI also implemented a series of sub-projects related to innovative start-ups. such as: building a nursery for mechanical businesses in Ho Chi Minh City; Participated in TECHFEST startup; organized conferences on branding for start-ups; Linking startup businesses of provinces and cities nationwide, prepared  for the APEC 2017 Business Startup Forum.

2.5.3. Regarding assurance of the business rights, equal access to resources and business opportunities of enterprises:

VCCI continues supporting SMEs to improve their competitiveness in order to strengthen their linkages in the value chain within the framework of the project " Support SMEs for the Development of industries link Clusters in the Value Chain of Rural Agriculture areas", aimed to support market access for businesses. In 2016, VCCI also actively participated in drafting and organizing conferences to consult on the development of the Law on Support Small and Medium Enterprises, contributed ideas on the organization and operation of the SME development Fund. .

VCCI advised the Party and Government on sustainable development and implemented activities to support enterprises to develop sustainably and to perform well social responsibility of enterprises. Some prominent activities includes: Successful set up of the Sustainable Business Indicators - a measure of the real value of the business; organized a program for assessing and rating enterprises in sustainable development in the spirit of guidance of the Government on the classification of sustainable enterprises from 2016 in order to promote and honor well-run enterprises. thereby contributing to raising awareness and promoting the entire business community in Vietnam to strive for comprehensive development in all three fields: economic social and environmental. Announced the Sustainable Business Directory in 2016, There were 100 enterprises that named in the ranking were honored and awarded the certificate of "Sustainable Development Enterprise 2016".

VCCI continued implementing the Action Program on promotion of integrity in Business, VCCI coordinated with national and international experts, especially the International Business Leaders Forum (IBLF) to improve Toolkit "Small and Medium Business Guidance to Prevent Corruption". The toolkit was developed by a group of G20 leaders (B20) to help businesses control one of the biggest challenges faced by businesses around the world that  are corruption and bribery. Toolkits have been introduced to businesses and updated on the site since October 2016.

In honoring and rewarding enterprises, in 2016, VCCI awarded certificates of merit to 211 enterprises, 385 certificates of merit to businessmen. Organized the review and awarded 100 outstanding Vietnamese businessmen in 2016 - Thanh Giong Cup, and launched the emulation movement "Vietnam Enterprise Integration and Development"; Announced the ranking of 100 sustainable development enterprises in Vietnam 2016; Coordinated the awarding of "Enterprises for employees". These are the activities and awards of VCCI that have great prestige for the business community. In addition, VCCI also participated in the National Quality Award Review Board 2015 and National Brand Commenting Council 2015.

VCCI implemented many activities to support international integration, namely:

- Supported enterprises in free trade agreements: As a representative, a focal point to guide the business community in international trade issues, especially free trade agreements, VCCI provided information and advice to businesses, business associations on the WTO and important trade agreements that Vietnam is involved in: to develop a "TPP Partnership" , to execute 9 reports on “Rview of Viet Nam's legal with the commitments of the Vietnam-EU Free Trade Agreement (EVFTA)" and "Trans-Pacific Partnership Agreement (TPP)". To establish the ASEAN Economic Community (AEC) Portal, organized and coordinated 37 events on TPP, EVFTA and other integration topics, to conduct 3 enterprise surveys on issues related to integration, to make 32 comments on issues of integration...

- Provided information, training, consultancy and other assistance on integration: There are 4 focal website providing the largest legal information on Vietnam's integration to associations and enterprises that have a total over 44 million hits, with an average of 10 news articles posted each day. In 2016, VCCI compiled and published 16 publications for business integration; hundreds of times consulting business via phone, email ....

- Participated in trade-economic delegations, bilateral and multilateral committees for economic cooperation, international and regional economic organizations such as: Attended in the ABAC meeting in USA, ABAC II in Papua New Guinea; Attended the Review Meeting on Trade Promotion Report between China and ASEAN (CLMV); Attended in the GMS BC Executive Council Meeting; attended in the Liaison Officers in preparation for the forthcoming 13th CABIS Conference in September 2016 and the Conferences on Capacity Sharing and Cross-Border Business Connections between China and Other Countries ASEAN; Attended in the 4th APEC Business Advisory Council (ABAC) meeting in 2016 and the dialogue between ABAC members and APEC leaders. Attended in CEO Summit 2016 in Lima, Peru. In parallel, the APEC 2017 Secretariat will prepare the content of APEC 2017 events in Vietnam, and consult the parties in identifying topics and priorities for APEC CEO Summit 2017.

2.5.4. Regarding reduction of business costs for businesses:

VCCI regularly organized annual business surveys and surveys to assess the level of business satisfaction with law enforcement, mechanisms, policies and measures to reduce business costs. enterprise.

Through the work of gathering recommendations of enterprises, VCCI has proposed many policies to reduce business costs for businesses such as recommendations on reducing land rental, reducing corporate income tax, reducing the cost of sea transport services ... The recommendations of VCCI have been adopted by the research policy agencies, creating more favorable conditions for enterprises.

As a member of the National Wage Council, the representative organization for employers, VCCI together with the Business Associations has persisted in dialogue with the Vietnam General Confederation of Labor and the organization representing the workers. Work at all levels in formulating annual regional minimum wage to ensure the harmony of benefits between workers and employers. The level of minimum wage increase in 2017 is only 7.3% lower than that of 2016, helping to reduce costs of business, improve labor productivity and competitiveness.

VCCI has also persisted in proposing the review, abolition of sub-licensing, and unnecessary business conditions to facilitate businesses to reduce costs and administrative procedures, has spent time and concentrated resources for production and business activities.

2.5.5.Regarding protection of the legal rights and interest of businesses:

VCCI has strengthened coordination with ministries, sectors, localities, national business associations, provincial multi-sectoral associations, universities, research institutes, and professionals to grasp actual situations of enterprises in order to better advise on policies and business environment for the Government through that to protect the legitimate rights and interests of specific enterprises such as:

- Has continued implementing agreements signature with ministries and localities, focusing on activities of business environment, administrative procedures reforms, introduction of local potential, trade promotion - investment, training support, information supply for enterprises.

- Established the Legal Working Group of the VCCI Executive Committee to assist and advise enterprises on settling specific cases of trade disputes, bottlenecks in production or business, or stucks in administrative procedures.

- Has promoted activities to strenghen the linkage and cooperation with business associations in order to improve cooperation, information and proposals on the production and business situation of enterprises. VCCI organized the Conference of the Central Council of Business Associations, the Association of Enterprises in some regions and areas throughout the country (North Central region, Southern area) to evaluate the activities of Business Associations in 2015, 2016 and orientation of some focused activities of the following years, and at the same time gathering recommendations of enterprises through business associations. Advised and supported the establishment of new business associations, Business Councils such as Vietnam Association of High Quality Goods in Ho Chi Minh City, Vietnam Automobile Parts & Accessories Association, Hai Chau Business & Investors Council in Ho Chi Minh City, Working group of food processing industry and beverages…

- In order to protect the rights and interests of enterprises in the process of integration, VCCI has continued to strengthen and maintain good relations with traditional partners such as WB, TAF, ADB, ILO, USAID, GIZ, GERA, IDRC. , embassies and consulates general. Has continued strengthening relationships with foreign trade promotion agencies in Vietnam, realizing many signed cooperation agreements. VCCI also signed nine cooperation agreements in 2016 with foreign partners to promote trade between Vietnam and other countries, including the Chamber of Commerce, Industry and Agriculture of Tanzania (TCCIA). Federation of Mozambique Business Associations (CTA); Kuwait Chamber of Commerce and Industry (KCCI); Federation of Chamber of Commerce and Industry UAE (FCCI); Slovak Ministry for Investment and Trade (SARIO); China International Trade Promotion Council (CCPIT), Ningbo City Branch, Zhejiang Province, China; Hong Kong Chamber of Commerce - Vietnam; Chinese Chamber of Commerce in Hong Kong; Hong Kong Trade Promotion Council.

Specific business support activities were also focused. in 2016, VCCI focused on supporting businesses in trade defense issues such as legal issues related to economic integration, particularly the use of anti-dumping measures. anti-subsidy and self-defense in Vietnam to protect the interests of domestic industries before foreign imports. In 2016, there were eight major support packages (the information, the legal advice) for Vietnamese business associations and enterprises related to trade remedies in Vietnam and abroad were implemented, in cooperation with The Ministry of Industry and Trade held two summary meetings on execution of trade remedies and complete solutions.


          3.1 Enterprise development after one year implementation of the Resolution:

In 2016, the number of registered enterprises reached a record level of 110.1 thousand enterprises with a total registered capital of VND 891.1 trillion, increasing 16.2% in number of enterprises and 48.1% % of registered capital compared to 2015. In the first four months of the year, there were 39,580 new businesses established, bringing the total number of registered enterprises up to April 30, /2017 to 1,090,731. Notably, the number of enterprises stopped or dissolved in 2016 decreased significantly compared to 2015 with 73,145 enterprises (down 9.5% compared to 2015), in which there were 12,478 enterprises that completed the  dissolution procedures and 60,677 enterprises had to stop operating. Particularly, there are bright spots in difficult areas such as the Central Highlands, where the number of newly established enterprises and the registered capital have achieved the highest growth rate compared to the whole country.

The results of the survey on enterprise dynamics conducted by VCCI (in November 2016) and by the General Statistics Office (on August 8), all enterprises showed a good sentiment toward production and business situation as of December 2017. Due to the data collection was delayed, so it is only possible to evaluate some of the enterprise development indexes as of December 31, 2015 and estimate the number of enterprises was operating in 2016. The results showed that enterprises operating in Vietnam was rapid development in the period 2007-2015. From the number of 149,082 enterprises operating in 2007, the number of enterprises operating in Vietnam in 2015 reached 442,486 enterprises, which was 3.0 times higher than that of 2007. The growth rate of the average number of enterprises in the period 2007-2015 reached 14.8% per year including the number of enterprises registered to set up, stop operation, dissolve and return to operation in 2016, by December 31,2016,  it was estimated that there were 546,281 enterprises be operating.

Apart from the regularly increased in the number of enterprises in operation, other positive factors were the positive growth rate of total capital and the number of stable workers in the period 2007-2015. However, in addition to the above results, there have been many signs that the unsustainability of enterprise development in the past year is:

 - In general, in terms of enterprise capacity, the efficiency of workers use in the period 2007-2015 was improved much but decreased, from 17.3 times in 2007 to 14.2 times in 2015 The capital use of enterprises was also decreasing. The rate of business losses increased again in the period 2011-2015 with an average of 40.9%. The yield on assets of enterprises in the economy decreased from 6.6% in 2012 to 3.2% in 2015.

- 2017 presaging of enterprises  for improvement in "Profit per unit of product" is currently at the lowest level compared to other indicators (the labor productivity, total sales). The use of capitals by Vietnamese enterprises is still a big problem as Vietnamese products produced have not created high rising value.

- The important point is that in the first months of 2017, the number of newly established enterprises increased but the number of enterprises stopped and dissolved was about half of the number of newly established enterprises. In essence, the size of the enterprise did not improve much, the average number of employees per enterprise fluctuated around 30 people - much lower than the criterion of small firms (less than 50 employees).

- For the three consecutive years of 2014, 2015 and 2016, the domestic enterprises were constantly inferior than the foreign business sector and declined in all three sectors: (i) Regardless of the trade balance of the country Domestic enterprises were constantly in trade deficit; (ii) the proportion of export turnover gradually decreased to only 28.4% in 2016; (iii) The export growth rate of domestic enterprises was always lower than the general growth rate of 4.8% (compared to the general rate of 8.6% in 2016).

-  Due to the small size of enterprises and the lack of leading enterprises, the supporting industries are still weak. FDI enterprises mainly import components and buy raw materials from abroad or from the available network, "contributing" significantly to trade deficit and transfer pricing. The paradox is that the rate of FDI enterprises is still the highest in the state and non-state sector, but investors still consider Vietnam as an attractive investment destination and performance indicators. The assets of the FDI sector are still the highest in comparison with other enterprises.

- The ability of corporate governance, corporate governance of Vietnamese enterprises is still very limited. The weakness in Management has also caused Vietnamese enterprises to "grow slowly" in quantity but weak in quality. Vietnam has just got about 700 listed companies on the stock market and with the application of good corporate governance practices at a very limited level compared with ASEAN 4 is a big challenge for Vietnamese companies to build trust for investors, business partners and brand development.

Causes of these constraints in business development as mentioned above may start from the weaknesses in the development of markets: market factors (the land, the labor, the technology, the finance) and commodity market (consumer goods and industrial goods). The Resolution 35 / NQ-CP is one of the tools to assist enterprises to participate and operate in these markets effectively, but with a year of implementation period, it is difficult to conclude accurately account for its impact on production and business results of the businesses. The first positive result that can be seen is the Resolution 35 / NQ-CP has created the confidence of enterprises in the market.

3.2. The implementation of resolution 35 of business associations and enterprises

3.2.1. Assessment of local government on the operation of business associations:

According to current preliminary statistics, there are nearly 460 business associations operating in the country, including 130 multinational business associations, professional associations operating nationwide and about 330 associations operating in regional, provincial / city and a few activities at the district / town level.

In March 2017, VCCI conducted a survey on the basis of evaluation reports of provincial People's Committees on the implementation of Resolution 35 / NQ-CP. The aggregate results showed the following general picture of the number and effectiveness of business associations:

The total number of business associations operating in 63 provinces was  337. Among them are:

- 52 Provinces / Cities with Business Associations

- 55 Provinces / Cities with Young Entrepreneurs Association

- 21 Provinces / Cities with Small and Medium Enterprises (mainly in the North).

The rest are Women Entrepreneurs Associations, Business Associations in Industries, etc.

According to the assessment of local authorities, about 3/4 of the business associations cooperated with the government, there were about "good" 21% at the "average" level and about 5% at the "weak" level; Participation in policy review by enterprises at the local level was rated "good" by 71% of the business associations; The "average" level for 24% of associations surveyed. The survey showed that most business associations, especially the 52 provincial business associations have played their roles well. However, some business associations at scale, gender and business associations at the district level have not been able to promote their membership functions, there were not many activities supporting members, activities are still heavily formality  and  movement.

3.2.2. Enterprises self-assessment on the implementation of the Resolution:

The survey of more than 1000 VCCI enterprises in late 2016 and early 2017 showed that about 80% of businesses said that they had done "well" and "quite well" the tasks  of resolution such as: executed the rights and obligations of enterprises in accordance with the provisions of law; Strengthened and developed solutions for harmonious, stable and progressive industrial  relations in enterprises; promoted restructuring, linkage, business cooperation; enhanced management capacity, productivity, quality and competitiveness.

However, the level of performance of some important missions was not good, especially for enhancing the application of advanced science and technology. Only 30.5% of businesses thought that they had done well this content. In the context of the upcoming industrial revolution 4.0, this is a big challenge for Vietnamese businesses. The active cooperation, association of enterprises by industry, field, size, area ... under the support, connection of the business associations were still limited and  low efficiency.

The main reason for this limitation is the awareness and activeness of a part of enterprises, especially are small enterprises on the challenges of competition, integration that are not high. On the other hand, in the context of fierce competition as the present, together with the business conditions are not favorable, the business associations do not support much because of limited resources, so the businesses itself have faced difficulties and confused in the implementation of the above tasks.


2. Through the implementation of the Resolution 35 / NQ-CP of VCCI and grasp the implementation situation in the ministries, localities and business community, it shows that:

 The issuance of Resolution 35 on supporting and developing enterprises to 2020 in a short time "record", with the principle objectives, tasks solutions effective, feasible and assign specific responsibilities It clearly demonstrates the high political will of the Government and the Government’s Prime Minister in creating a favorable, safe and friendly business environment in order to build a strong and powerful Vietnamese business community. competitive forces, sustainable development.

- The Resolution 35 / NQ-CP is a comprehensive, long-term, breakthrough view of supporting business development, demonstrating the determination of the government and the Government’s Prime Minister in creating the business environment is advantage, safe and friendly, aiming to build a strong and competitive Vietnamese business community. The resolution has received positive attention from the ministries, localities, the business community and the whole society.

The tasks and solutions set out in the Resolution are long-term solutions, which require more time to clearly see the positive impacts and constraints. VCCI at the end of 2016 beginning in 2017 showed that 75% of enterprises assessed the impact of the five groups of solutions proposed in the resolution as "relatively positive", "positive" and "very positive" only 25% of businesses said that they did not notice the impact of these solutions. (See Appendix in the Report).

Some specific results of the implementation of the resolution are as follows:

After the Resolution was promulgated, the ministries and branches were actively involved in the project. The objective was clearly to issue and implement solutions to support enterprises. Many solutions have been discussed, promulgated and promoted. The most remarkable activity is that the ministries have actively reviewed and proposed abolishing and simplifying many business conditions stipulated in the circular; issued nearly 50 decrees on business conditions to implement the provisions of the Law on Investment and the Law on Enterprise 2014. The spirit of Resolution 35 directly impacted the results of this review process. The shies in considerations when simplifying, abolishing the administrative procedures of the ministries themselves have reduced a lot. The dialogues, reviews of business obstacles in many areas were held, the most recent (on May 13, 2017) was  the direct dialogue with the ministries on the problems related to the Ministry of Health, the Ministry of Finance, the Ministry of Natural Resources and Environment on wastewater standards; food safety regulations; charges and fees in the agricultural sector. In the Government’s Prime Minister's Directive No. 17 / CT-TTg dated May 9, 2017 on strengthening the effectiveness and effectiveness of state management, rectifying advertisement activities, basically eliminated the proposals promulgated by the Advertising Enterprises Association recently has released.

- Some ministries have started many big and important programs for businesses, such as the Ministry of Finance has done drastic reform in the field of taxation, customs, social insurance. The State Bank has instructed commercial banks to adjust lending interest rates rationally, has reduced loan procedures and diversify credit products. The Ministry of Public Security has actively implemented electronic visas, created articles favorable conditions for tourism development, attracting investment. Ministry of Industry and Trade, after reviewing and announcing the plan has cut more than hundred administrative procedures, in 2016 actively abolished the formaldehyde declaration 37 with machine weaving, rice export plan ... and is planning to abolish, simplify many other procedures. The Ministry of Agriculture and Rural Development has strengthened dialogue and proposed mechanisms and policies to create favorable conditions for enterprises to invest in agriculture and rural areas.

- The majority of provinces and cities have been actively involved in the Government response. Some localities take the lead in implementing resolutions such as Hanoi City, Quang Ninh, Da Nang and Dong Thap Provinces. Hanoi City has deployed an online public service portal, has reduced the construction permit time from 30 days to 10 days, the time of issuing certificates of land use rights from 30 days to 14 days. Da Nang City is at the forefront of building a creative start-up network, handling administrative procedures without administrative restrictions until the end of work. The Dong Thap Province has pioneered the mechanism of dialogue, solved problems, supported enterprises and investors, has maintained "entrepreneur coffee" weekly with businesses.

Dialogue activities and business meetings (an important indicator given in the Resolution 35) have been regularly implemented in provinces and cities throughout the country. According to the VCCI survey, 57% of enterprises said that the provinces and cities where the enterprises operate had meetings and public dialogues with enterprises, 58% said provinces and cities had opened the hotline, online questions and answers on the Portal to receive feedbacks, guidances and answers for businesses.

In general, the change of awareness of cadres and civil servants, especially at the grassroots level, in terms of morale and attitudes towards enterprises in the process of implementing Resolution 35 / NQ is an important progress and be remarkable.

.- All localities have actively completed the signing with VCCI and business associations of commitments to improve the business environment. One of the most important objectives of Resolution 35 is to increase the number of enterprises operating effectively and the localities have concentrated more resources to carry out this task. This contributed significantly to the number of newly established enterprises last year, over 110,000 enterprises, the highest number ever recorded with registered capital of VND 891 trillion, up nearly 49% together, the number of enterprises has returned to operate more than 26,600 enterprises, an increase of 43%. VCCI considers this as a very positive initial response to the requirements of the Resolution 35 / NQ-CP.

- Entrepreneurs and investors have initially benefited from the issuance and implementation of the Resolution. The important principles of the Resolution such as "State management agencies when enacting and enforcing policies must ensure that each task has a single lead and responsible person," " Economic and civil relations, and at the same time strictly handle all acts of violation of law ", "Enterprises have the right to freely conduct business in branches and trades not prohibited by law " … has had a great impact on the state apparatus at all levels, not only the executive but also the judicial system. Particularly, many enterprises said they were more favorable in implementing administrative procedures from the very specific solutions of the Resolution such as "combining multi-sectoral inspection and examination during an inspection and examination, except for cases of inspection or extraordinary examination, when there are clearly signs of law’s violation "or" handling administrative procedures for enterprises on the principle of requesting the amendment or supplementation of dossiers to notify in writing to enterprises and investors of all contents which need to be amended and supplemented for each dossier set. " From these, enterprises have the right to express their opinions when receiving inspection and examination delegations or carrying out administrative procedures. Although these spirits and regulations have not been implemented widely in the localities, the ministry has initially created very positive effects.

 - Newspapers and media have dedicated the appreciation to the Resolution 35 / NQ-CP. There have been a lot of articles and bulletins on the Resolution since its promulgation so far, urging State agencies strictly implement and also provide information to businesses for application.

 However, after nearly one year implementation of the resolution, there have beensome shortcomings and limitations as follows:

  -  Although propaganda, dissemination and implementation of the Resolution have been implemented early by the Ministries, localities, VCCI and business associations but have not yet reached the grassroots level (districts, communes and wards) and businesses. Many businesses still do not know the Resolution 35 / NQ-CP of the Government on business development to 2020.

  - Despite the drastic direction of the Government and the Government’s Prime Minister, the movement of some ministries and localities is slow. Some ministries, due to internal interests, not really change in perception, mechanisms and policies to serve and support enterprises. Some ministries have not actively participated in the implementation of PAR projects as assigned by the Government’s Prime Minister. The promulgation of documents detailing the implementation of laws, ordinances, implementation of the scheme is late to meet the schedule. Some policies, mechanisms and policies to support enterprises are late to implement.

  - Some targets stipulated in the Resolution are not satisfactory. VCCI's survey showed that 37% of surveyed enterprises were inspected in 2016. However, about 13.8% of businesses were inspected four or more times a year in 2016. In enterprises with two or more inspections, 52.4% of businesses thought that contents of the inspections were the same. It is noteworthy that specialized inspections, especially for food processing enterprises, are becoming burdensome due to the oversight by many ministries and agencies of the Ministry of Agriculture and Rural Development, the Ministry of Health, the Ministry of Industry and Trade and local governments. In particular, there were cases where enterprises were inspected nine times a year, although the content in each inspection was  not the same but put a lot of pressure on businesses. Therefore, in the coming time, it is necessary to strengthen the inheritance of inspection results between agencies to reduce the overlap in the examination content.


In order to continue implementing the Resolution 35 / NQ-CP in the coming time, the Chamber of Commerce and Industry of Vietnam would like to propose some specific contents as follows:

5.1. Supplementing the group of solutions related to the improvement of macroeconomic institutions:

- To focus on reviewing and eliminating regulations for allowing  state agencies to interfere too deeply in markets such as markets of the land, the labor, the capital, the technology and the industry, especifically:

- To consider proposing to the National Assembly for amendments to the Land Law, in the direction of establishing the people's property rights over land and assets on land; to ensure rapid conversion of land use; to support for land accumulation with the market price mechanism. In the immediate future, the State must strictly handle the cases of suspended planning, thus obstructing the business activities of enterprises, and adopt a flexible mechanism for adjusting land rentalto be suitable to their profitability.

- non-administrative business organizations as the Decree No. 01/2017 / ND-CP amending and supplementing a number of decrees, detailing the implementation of the Land Law that currently is wearing for investment enterprises in the  industrial park infrastructure responsibilities as an intermediate level of administrative management of the land that should be responsibilities of the State management agencies.

- to develop an effective communication mechanism to promote the labor market, thereby focusing on the importance of attracting labor from agriculture as well as training workers in hi-tech agriculture.

- There are mechanisms to create conditions for expanding long-term and medium-term capital sources, to create conditions for enterprises to invest in technological renewal.

- To step up the activities of intermediary organizations and develop business development service organizations to support the technology market and the industrial market (supporting industries).

5.2. Continuous implementing 05 groups of solutions proposed in the Resolution on the basis of the proposals and recommendations of enterprises as follows:

5.2.1. Regarding administrative reforms and creating favorable conditions for enterprises:

- General recommendations: To propose that the State should require a more radical and innovative solution to reform administrative procedures as well as in the organization, implementation and monitoring of the OSS model, the center of public administration; To improve the form of organization of dialogues between enterprises and local administrations; Thorough research and solve problems of enterprises in a timely and satisfactory manner, to avoid the situation of "explaining" many "not resolved".

- Specific recommendations:

+ To continue to improve the procedures on: tax reporting, use of invoices, tax finalization, tax arrears, tax fines, inspection and settlement of tax complaints for enterprises. Some of the procedures that are designed to be "fraud prevention" need to be translated into "post-audit", rather than requiring all honest entrepreneurs to do so.

 + To develop a style of work culture; to educate a sense of serving businesses for  government officials, especially in some sectors that directly related to businesses daily such as tax, customs, treasury, construction, land, inspection and environment ...

+ To make some recommendations on administrative reforms to support the development of the tourism industry such as considering visa exemption for citizens of countries which are key markets of Vietnam tourism; to strengthen state management of travel and accommodation activities; to adjust regulations on leisure time in public areas as well as entertainment services in tourist accommodation establishments.

+ Some recommendations in the field of advertising: Ministries, sectors and localities should implement soon the Directive 17 / CT-TTg dated 9 May 2017 of the Prime Minister on strengthening the effectiveness and efficiency of management of the State, to adjust the advertising activities, especially the problems enterprises have encountered many difficulties and obstacles such as procedures for conversion of land use purposes for advertising; advertising planning; to confirm  the aadvertising content; the Code of conduct in advertising.

5.2.2. Creating a favorable environment for supporting innovative businesses:

General recommendations: It is recommended that localities really pay attention to and effectively carry out business start-up activities while limiting the activities of "movement". It needs to diversify and innovate in the development of business start-up and business development services; to quickly plan and build small-scale industrial clusters in regions and localities; to promote the operation of the National Fund for Scientific and Technological Development; to continue to encourage individual households to transform into formal enterprises, but based on the needs and capabilities of the individual business households themselves.

The Government should supplement regulations on the technology and products of science and technology enterprises which have been inspected prioritized for use in Government procurement projects; to prioritize the use of domestic technologies in investment projects funded with the State budget; to complete the regulations guiding the implementation of policies and incentives for science and technology enterprises on finance, import and export, investment; to complete the national standard system, to update the standard system for product validation; to restrict the import of foreign technologies; to guide the science and technology enterprises to register and announce the standards permitted for circulation

- Specific recommendations:

+ To consider the elaboration of the program on technology innovation loans for small- and medium-sized enterprises with appropriate interest rates and repayment time to help enterprises change their modern technologies and raise the competitiveness of Vietnam.

+ To propose the Government to study and promote effectively the national technological renewal funds; SME Development Assistance Fund; Particularly, it is necessary to review the management mechanism as well as the procedures for accessing these funds, ensuring the support of enterprises in catching up business opportunities; to improve procedures for disbursement from the Funds: limiting the discrepancies in procedures for disbursement from sources (through the State Treasury and through commercial banks) when funding the same project.

+ The State shall study and support the banks and enterprises in implementing preferential credit packages to encourage the development of hi-tech agriculture in a rational manner suitable to the market mechanism. There should be a combination of special support measures to form linkages between farmers and businesses operating in areas such as logistics, processing and distribution of products, limiting the status too much dependence on the Chinese market, unplanned agricultural production planning and rampant production, "rescue" in all years..

5.2.3. Ensuring business rights and equal access to resources and business opportunities of enterprises:

General recommendations:

+ It is recommended that relevant ministries, branches and agencies promote dialogue policies between enterprises and state agencies; to ensure that information is publicly available during the legislative process; to strictly implement  consultancies  of affected subjects and experts; to strengthen the quality and involvement of law enforcement officers in ministries and branches in Law development.

+ To revise  the Decree 210 on attracting investment in the agriculture. To focus on solving land policies, linking chains for developments of the hi-tech agriculture and the clean-technology agriculture, exploiting and controlling raw materials sources.

+ To restrict enterprises who do not have sufficient financial capacity to invest in infrastructure construction in the form of public-private partnerships.

- To remove concerns and obstacles in the way of discrimination against private enterprises and SMEs in the process of operation compared to large enterprises, FDI enterprises and SOEs tend to increase.

+ To propose assigning tasks to business associations on the basis of fair competition, strictly according to the functions and tasks prescribed in the operation charter already approved by the Government’s Prime Minister and competent state agencies. To eliminate discrimination between business associations with the same functions and duties.

+ To prioritize capital for key programs and projects of  the national on infrastructure, which have been committed by the Government but not yet disbursed in time, causing difficulties for the investors.

- Specific recommendations:

On the implementation of the Law on Enterprise 2014: to settle obstacles of establishing business households; on the management, use and storage of seals.

Regarding the Law on Investment: To deal with the fact that investors have to make a deposit to secure the implementation of the projects assigned or leased land by the State and to permit the change of land use purposes; to clarify the provisions on the handling of transitional projects, the assurance of implementation of investment projects; to propose additional forms of guarantee through commercial bank guarantee.

There is a conflict between the provisions of the various laws, particularly is as follows:

+ Procedures for assessment of environmental impacts have conflicts between the provisions of Resolution No. 43 / NQ-CP dated June 6, 2014 by the Government and the Law on Environmental Protection.

+ Procedures for fire prevention and fighting: Conflicts in the procedural sequence between the provisions of the Investment Law 2014 and the Law on Fire Prevention and Fighting.

+ Regarding goods purchase and sale activities of foreign-invested enterprises: To propose amending the Government's Decree No. 23/2007 / ND-CP of February 12, 2007 in conformity with the provisions of Investment Law 2014.

+To propose to refer to the regulations on the form of bidding for selecting enterprise valuation consultants (between Decree 116/2015 / ND-CP dated November 11, 2015 and Decree 63/2014 / ND- CP dated June 26, 2014 of the Government).

+ To encourage sugarcane bagasse: It is proposed to consider and adjust the price of cogenerated electricity from the bagasse of the sugar mills that are agreed to calculate one unified price only that is the biomass price not divided into two current prices.

Implementation of SMEs support policy:

+ To improve the management mechanism to accelerate disbursement of the SME Development Fund, to ensure the  publicity and the transparency.

+ To adopt mechanisms to encourage individuals and large enterprises to contribute financially to the SME Development Fund while at the same time raising the responsibility of organizations and individuals participating in the Fund's management.

+ to strengthen the role of commercial banks in setting up and implementing the credit guarantee system for SMEs. Thanks to this system, outstanding loans of commercial banks for SMEs is increasing.

To propose the Government’s Prime Minister to lead the ministries and branches to amend or submit to competent authorities for amendments a number of articles of specific provisions of law:

1) To annul Point c, Clause 3 of Article 24 of Decree No. 60/2014 / ND-CP has stipulated printing activities with the following contents: Refraining from cooperating with other printing establishments to conduct prepress, press and postpress of products received under cooperation with others;

2. To reject Clause 8, Article 4 of Decree No. 05/2015 / ND-CP detailing and guiding the implementation of a number of contents of the Labor Code with the following contents: With regard to personal protective equipment provided for employees : Specific quantity, type, quality and service life of each type of personal protective equipment as prescribed by the employers.

3) To annul Clause 6, Article 6 of Circular No. 15/2015 / TT-BKHCN of the Ministry of Science and Technology dated August 25, 2015 has stipulated on measurement and quality of petrol and oil trading with the following contents: When the gasoline meter is damaged, the leaded equipment can be repaired only if it is hired other establishments to repair and if being agreed by the those manufacturing, import or supply establishments.;

 4) To annul Clause 1, Article 7 of the Government's Decree No. 78/2015 / ND-CP dated 14/9/2015 on enterprise registration with the contents: the enterprise must write the level 4 business lines on the application for enterprise registration and investment procedures.

5) To annul Clause 2 of Article 49, Articles 50, 51, 52, 53 and 54 of the Government's Decree No. 78/2015 / ND-CP dated September 14, 2015 on enterprise registration with the following contents: Change of business registration contents for enterprises.

6) Article 25 of the Government's Decree No. 83/2015 / ND-CP of September 25, 2015 on offshore investment and transfer of procedures for termination of offshore investment projects must be amended. by state agencies into notification procedures;

7) Article 27 of Decree 60/2014 / ND-CP of the Government dated 19 June 2014 has stipulated the printing activities with the following contents: Granting import permits for a number of machineries and equipment print;

8) Clause 2, Article 79 of the Notarization Law of 2014 shall be annulled with the following requirements: Notarization office must change name when changing office;

9) Requirements for the head of the printing establishment; (the Decree 60/2014 / ND-CP of the Government dated 19 June 2014 regulating printing activities with the following contents:

10) ) To amend Clause 1, Article 4 of Circular No. 57/2015 / TT-BCA guiding the provision of fire prevention and fighting means for land-road motorized traffic means without requiring equipment for fire prevention and fighting Fire for passenger cars of 9 seats or less;

11) To annul Point 5, Clause 5 of Circular No. 21/2015 / TT-BNNPTNT dated June 8, 2015 of the Ministry of Agriculture and Rural Development on the management of plant protection drugs is repealed with the following contents: the active ingredient content for each type of finished product of plant protection products;

12. To annul Clause 4, Article 15 of the Government's Decree No. 60/2014 / ND-CP of June 19, 2014 on printing activities with the contents of information requirements of printing enterprises.

 13) To annul Point a, Clause 1 of Article 30 of the Government's Decree No. 60/2014 / ND-CP of June 19, 2014 on printing activities with the following contents: It is forbidden to use color photocopiers for business purposes;

14. To annul Clause 1, Article 9 of the Agriculture and Rural Development Ministry's Circular No. 12/2015 / TT-BNNPTNT dated March 16, 2015 guiding the inspection of food safety of imported plant origin goods content: Imposition of import conditions for plant-based goods based on the conditions of the exporting country registered for importation with Vietnam;

15) To annul Clause 1, Article 24 of the Government's Decree No. 73/2012 / ND-CP of September 26, 2012, on foreign cooperation and investment in the field of education with the following contents: limitation of the rate of students of foreign-invested educational establishments;

16. To annul Clause 3, Article 10 of the Decree No. 30/2014 / ND-CP of the Government dated April 14, 2014 on conditions for shipping business and maritime transport support services with the following contents: Shipping agency services must have a legal department;

17) To annul Article 1 of the Circular No. 20/2011 / TT-BCT of the Ministry of Industry and Trade dated 12 May 2011 has stipulated additional procedures for importing passenger cars of 9 seats or less with the following contents: Traders importing passenger cars of 9 seats or less must have the authorization of the manufacturer. To develop a decree on appropriate automotive business conditions to protect domestic automobile production and promote healthy and appropriate competition in automobile imports;

18)  To annul Clause 4 of Article 15, Clause 4 of Article 16, Clause 7 of Article 17, Clause 4 of Article 18 and Clause 2 of Article 19 of the Government's Decree No. 86/2014 / ND-CP dated 10/9/2015 on business and carriage of goods by truck with the following contents: Conditions on the minimum number of cars in the field of passenger transport by cars;

19. To annul Clause 1 of Article 59, Article 60 of the Accounting Law of 2015 with the following contents: Conditions for dealing in accounting services (1) enterprises not being joint-stock companies and (2) representatives at law , the director or general director of a limited liability company must be a practicing accountant;

20) Article 3, 4 and 5 of Circular No. 09/2014 / TT-BTTTT of the Ministry of Information and Communications dated 19 August 2014 detailing the management, provision and use of information on the social networking site and content: Conditions to be set up social networking;

21) Article 72 of Decree 78/2015 / ND-CP of the Government dated September 19, 2015 on business registration is repealed with the following contents: the tax office or the market control agency where the head office is registered and the place where the business is conducted;

22) To amend Article 106 of the Labor Code 2012 in the direction of increasing the minimum working hours of workers.

5.2.4. Reducion of business costs for businesses:

General recommendations: Due to the high level of lending interest rates of credit institutions, the State should have policies to support and reduce taxes, create favorable conditions for enterprises to stabilize investment and  develop in the present difficult times; to flexibly apply methods of loan security; to consider increasing the minimum wage level suitable to the stamina of the enterprise; to improve the skills of workers so as to increase productivity and reduce labor costs, especially for labor-intensive sectors such as textile and garment, leather and footwear.

Specific recommendations:

+ To continue  to propose the National Assembly for consideration of  issuing a number of tax solutions to remove difficulties, obstacles and promote the development of enterprises.

+ To amend  the Labor Code providing flexibility of working hours, ensuring the benefits of both workers and enterprises, rather than the current limit of 30 hours per month, 200 hours per year.

+ To consider reducing the contributions of employers: The compulsory social insurance (all 5 regimes) is now 22% (the probability is reduced to 21%) - the fee is still high compared to countries in the ASEAN region.

+ The base for paying social insurance premiums from 2018 based on the total income of employees that also makes difficulties for enterprises, especially are small and medium enterprises. Therefore, it is proposed to delay the implementation of this policy until 2020 and review this policy again.

+To propose that local authorities are urgently requested to reduce land rental.

+ To amend the land policy to permit industrial park infrastructure enterprises (in case of land use levies, land rental or land lease by the State) and secondary enterprises are allowed to mortgage land use rights to borrow bank loans and mobilize long-term loans; to create mechanisms and policies to assist enterprises in accessing production land in industrial parks and industrial clusters and allow the flexible payment of land rental to suit the needs of small and medium enterprises.

Land tax exemption for investment projects with low coefficient of land use.

+ The Ministry of Industry and Trade shall immediately issue a notice to calculate electricity prices and water prices for establishments providing tourist services at electricity prices of production establishments.

+ The Ministry of Finance shall issue a document guiding an exemption of import tax on hotel equipment and specialized means of transportation of tourists which can not be produced domestically.

+ To unify the framework of the general fee schedule for provinces to determine environmental protection fees in a reasonable manner, to avoid the situation of large differences between localities, or between geographical areas with the same conditions. To publicize the mechanism of using environmental protection fee source.

5.2.5. Protection of the legitimate rights and interests of enterprises:

- General recommendations:

+ To further shorten the time and procedures for bankruptcy of enterprises; To improve the efficiency of civil judgment enforcement; to develop strong sanctions to deter unfair competition, IPR infringement.

+ It is necessary to investigate and handle in time acts of producing and trading fake goods and imitation goods. To ensure strict inspection and control processes, not duplicate as well as not leave them open, causing troubles for businesses entities and obstructing the circulation of goods.

+ To pomote the role of VCCI and industry associations in protecting enterprises; To collaborate with relevant ministries to inspect and detect trade frauds, ensure sector prestige and trademark of Vietnam.

- Specific recommendations:

+ To improve the inspection of tourist accommodation establishments, to avoid the inspection status many times, especially the inspection time from 23h onwards.

+ To strengthen the role of the tripartite partnership inindustrial relations; to promote the effectiveness of mediation and arbitration measures, especially in the settlement of collective labor disputes and strikes; to renovate the activities of trade unions at enterprises; to continue improving the quality of dialogues, negotiations and collective bargainings.

+ To include activities on labor disputes and strikes in the right corridor in order to avoid illegal strikes. To "standardize" the process of resolving strikes.

+ There are regulations to protect the legitimate interests of enterprises when signing contracts with farmers. Although contracting is supported by the local government, when the prices of products rise up, farmers sell them out, the businesses are helpless / it is difficult to sue  under contracts and authorities are bystanders.

5.3. Completion of the implementation of Resolution 35:

- To request the  Government’s Prime Minister to direct more decisively some tasks related to the implementation of the Resolution by effectively organizing the Business Conference with the Government’s Prime Minister in 2017 and issuing the Government’s Prime Minister's Directive on improving the effectiveness of implementation of the Resolution 35/2016 of the Government. It is necessary to continue to conduct preliminary reviews of the implementation of Resolution 35 from 2017 and subsequent years to reinforce the business community's confidence in a government that is incorruptible, constructive, actionable, and supportive. To consider enterprises as the growth engine of the economy. 

To review and direct ministries and branches to seriously implement resolutions, especially the elaboration and organization of action programs for the implementation of resolutions strictly according to requirements, avoiding censuses and forms. For the task group to reduce business costs, the Government will focus on addressing a number of key tasks related to reducing the cost of access to production sites, land taxes, transportation fees, etc.

 - In order to effectively implement the objectives, principles, tasks and solutions mentioned in Resolution 35, the Government urgently recommends the implementation of the decrees guiding the implementation of the Law on SME (if adopted in the period meeting of the Third National Assembly, XIV) to ensure that support programs meet the needs of SMEs; To strongly promote the role of VCCI and business associations in the implementation of programs and projects to support the start-up, establishment and development of SMEs.

- Ministries, branches and localities should fully implement the responsibilities assigned in the resolution. Ministries should study the problems of the business thoroughly and systematically, to limit the similar problems arise. To strengthen dialogues with businesses according to professions. It is important to understand the underlying causes of the problem and to consider making favorable policy conditions more suitable for businesses, rather than just stopping in policies’s explanation (not solving problems). There should be sanctions for cases of delayed responses to enterprises.

- It is necessary to have guidelines for the organization of business dialogues in the local areas, in essence, solve the problems of enterprises towards improving the competitiveness of enterprises. In order to do this well, the Government needs to improve the capacity of civil servants in policy and business, especially in understanding the needs of enterprises, of the enterprise in the socialist-oriented market economy from which to develop appropriate policies and at the same time improve the morality of the public. To build and replicate models, good practices in the relationship between government and enterprises such as "Coffee entrepreneurs".

- Specific guidelines and inter-sectoral coordination mechanisms should be developed to implement the principles of the resolution such as non-criminal economic and civil relations and at the same time strictly handle all violations of law. The inspection and examination according to the provisions of law (not more than 1 time / year), incorporate multi-sectoral inspection and examination in an inspection or examination, Except for unexpected cases when there are signs of law violation clearly; to improve state management towards simplification of pre-inspection and post-inspection ...

The Chamber of Commerce and Industry of Vietnam respectfully reports.

- To set up inter-branch working teams to supervise the implementation of the six groups of solutions mentioned above, to quarterly evaluate the results and report them to the Government’s Prime Minister.

- To highlight the role of the Fatherland Front and the People's Councils in supervising the implementation of the Resolution; to continue recommending the National Assembly to adopt the Law on Associations.

  Above is the report on the implementation of Resolution No. 35 / NQ-CP dated May 16, 2016 of the Government.

C/C :                                                                                 

- As above                                                                          

- The Steering Committee for Enterprises Renovation and Development

- Ministry of Planning and Investment

- The Steering Committee (for report)

- Saved by Archive  and Admin





          Vu Tien Loc






 After nearly a year implementing Resolution No 35 / NQ / CP, Vietnam Chamber of Commerce and Industry conducted a survey collecting opinions of enterprises on the implementation of resolutions of ministries, localities and enterprises. . The survey received the participation of 1087 enterprises and business associations nationwide (32 associations and 1055 enterprises, among the total of 1055 surveyed enterprises, There were 794 respondents in the period from November to December 2016 and 261 respondents in the period from February to March 2017.

I. Assessment of enterprises on administrative reforms, creating favorable conditions for enterprises

Enterprises have seen many positive changes in the working environment, especially the administrative procedures in State agencies have been renovated, carried out quickly, simply, many procedures are transferred to the implementation by internet ( social security, tax declaration, some business registration procedures)  help to reduce time, effort as well as costs. In addition, information on support policies has been also regularly published on many media, creating the best conditions for the operation of enterprises.

Evaluation of the effectiveness of the activities of ministries, branches and People's Committees of provinces / cities that aimed to administrative reforms, facilitate enterprises, there is about 60% of comments from businesses that the activities of Ministries, Provincial People's Committees evaluated that "very effective" and "effective". In particular, the rate of enterprises evaluating activities on "promotion of  the effective implementation of the one interconnection stop shoping" is "very effective" and "effective" highest (accounting for 74, 9%) and the "establishment and publicity of the hotline" and the " thorough  civil servants on official ethics " have the rate of evaluation of the "very effective” and" effective”  lowest, approximately 60%. (Figure 1).

 Chart 1. The effectiveness of the activities of the provincial People's Committee  to administrative reforms and  facilitate enterprises


Source:  VCCI- Survey on the impact of the 35-NQ / CP resolution to businesses.

In fact, the reform of administrative procedures under the "one-stop shopping" and "interconnection one-stop shopping" have gained some positive results, shortening the time, simplifying procedures and  publicity,  so ensuring better the legitimate rights and interests of enterprises. The tax and customs sectors have made great efforts to improve the services to enterprises. In the field of customs modernization, the administrative procedures have been improved, Many intermediaries in the direction of organizing  completion customs clearance line, one - stop shoping, thus significantly reducing customs clearance time.

Apart from results and achievements, the implementation of the "one-stop shopping" and "inter-connection one - stop shopping" have the following major limitations:

- In many places, the results of solving administrative records in some areas for organizations, citizens are still lower than the requirements. Many dossiers are not timely resolved, especially in the field of land and construction.

- The sense of responsibility to perform duties, public duties and attitudes to serve the people of the majority of cadres and civil servants have changed,  but be still slowly.

- The implementation of the "one-stop shopping" and "interconnection one-stop shopping" are incomplete and the procedures for handling certain types of administrative files are cut off according to the administrative levels and has not yet created the unification settlement process from central to local.

Facilities and equipment for OSS activities of administrative agencies at various localities have not received adequate support.

- The majority of People's Committees of provinces, cities, departments and branches have not yet publicly and transparently the administrative procedures for the records of enterprises on websites so that enterprises can access and know where their dossiers are resolving and which sections they are belonging to.

II. Assessment on the creating a favorable environment to support start-up and innovative businesses

An assessment on impacts to businesses of the solution groups is given in the Resolution 35 to create a favorable environment, to support start-ups and innovative businesses, with 35-40% of comments from enterprises evaluated these solutions have the effect of "relatively positive", "positive" and "very Positive". In particular, "start-up policies" has the highest rate (80%); "SME Development Fund" has the lowest rate (67%) (Figure2).

Chart 2. An assessment on impacts to the businesses of the solution groups is given in Resolution 35 to create a favorable environment to support business start-ups and innovative businesses.

Sources:  VCCI - Survey on the impact of the 35-NQ / CP resolution to enterprises.

Although the Resolution 35 / NQ-CP stated that "measures need to be taken to accelerate the implementation or supplementation of functions and tasks for the Small and Medium Enterprise Development Fund to increase capital for start-up ", Small and Medium Enterprise Development Fund has been evaluated having the least positive impact on enterprises in recent years. Difficulies in approaching  loans are always a concern of small and medium enterprises. The Small and Medium Enterprise Development Fund is expected to provide additional concessional loans to support businesses. However, to approach  capital resources of this fund is also not easy. Enterprises must have feasible production and business projects and plans on the list of priority areas of support of the Fund. Enterprises with feasible production and business projects and plans supported with loans from the Fund may not be supported with preferential loans from other State credit institutions. Another condition is that the level of loan capital for each project or production-business plan is equal to 70% of the total investment capital of each project or each plan (excluding floating  capital), but not more than VND 30 billion. With regulations on loaning rates and "standard" conditions, thus, SME Development Funds are not too preferential to commercial banks, so enterprises are not enthusiastic to choose approaching. This capital resource. 

 One of the other solutions mentioned in the Resolution is "to have mechanisms and policies to create favorable conditions for enterprises to access land". However, these policies are not yet effective. According to the survey, there were about 28% of respondents said that the positive impact of this policy on enterprises is not clear. Difficulties in the site clearance agreement, especially in the area of compensation, clearance and resettlement when the people are recovered land still happened; procedures were still  cumbersome; Land allocation for businesses is still slow; the "clean" land fund to encourage businesses to invest in production and business development is public social welfare projects that have still not got.

III. Assessment on assurance of rights to access business and equal access to resources and business opportunities of enterprises

To assess on the impact  to enterprises of the solution groups set out in the Resolution 35 to ensure the right to business, equal access to resources and business opportunities of enterprises, there was  about 35-40% comment from enterprises to evaluate these solutions have the effect of "Positive" and "Very Positive". There was about 1/4 of comments from businesses have not noticed the impact of these solutions. Businesses thought that these groups of solutions when being implemented were still unclear such as: policies to remove tax difficulties for businesses; or 50% reduction of personal income tax on labor in some high technology areas, high technology application in the field of agriculture and seafood processing.

Charter 4.Assessment on impacts to enterprises of the solution groups set out in the Resolution 35 to ensure business rights, equal access to resources and business opportunities of enterprises.

Source:  VCCI- Survey on the impact of the 35-NQ / CP resolution to businesses.

In the groups of solutions to ensure business rights, equal access to resources and business opportunities of enterprises, "CIT reduction for SMEs" is assessed to have the most positive impact on enterprises. The Resolution No. 35 / NQ-CP of the Government on business support and development assigned the Ministry of Finance to submit a report to the Government to submit to the National Assembly resolution to remove difficulties in tax in 2016; Dealt with delayed payment to enterprises facing objective difficulties; studied and proposed the reduction of CIT rates for SMEs. Ministry of Finance presented 5 issues related to CIT measures. It is worth noting that the CIT reduction for SMEs with the proposed standard tax rate was 17%. This tax reduction will help SMEs increase their accumulation, reinvestment, business development, competitiveness and not significantly affect state budget revenues, as the number of small and medium enterprises is big in the economy but small contribution to the state budget. In fact, the smaller t enterprises, the more vulnerable to the fluctuations of the economy, the business environment, the competition in the international economic integration. It can be said that reducing CIT for SMEs will support the right and hit the target to achieve economic and social benefits but not significantly affect the state budget revenues.

“the completion of bankruptcy procedures has at least impact to businesses. The reason is that bankruptcy proceduresv are still difficult and complicated. Implementation time is still long. By law, after 90 days from the filing date, the business will receive a final court declaration. However, in fact, after more than 3 months from the filing date, the story of a business continues to exist, with no progress. There are businesses that the  court has served the sentence but nearly half of a year has not been able to complete the procedures and resolve the obligations and responsibilities involved.”

Assessmenton on impacts to enterprises of solutions groups of credit organizations to support enterprises to approach loans, there were about 50% of comments from enterprises assessing these solutions have the effect "positive" and "very positive". In particular, the solution to "simplify loan procedures" accounted for the highest rate (50.1%), "price stabilization program" accounted for the lowest rate (47.2%).

Chart 5. Assessment on impacts to businesses of solutions group of credit organizations to support enterprises approaching loans

Source:  VCCI- Survey on the impact of the 35-NQ / CP resolution to businesses.

According to the survey, there were about 20% of comments from enterprises that the impact to enterprises of solutions group of credit organizations to support businesses approaching loans in the Resolution is unclear. The reason is  that the valuation of the mortgaged property was a real estate change. In the past, banks looked at market valuations, but the new regulations now define the value at the publicly announced annual prices. Therefore, the same collateral,  but the loan limit is now lower than before so the company is trapped capital in production, in inventory, have to run to find additional financing while no collateral. Another reason is that some enterprises do not have the financial capacity to repay or revolve their capital. They have to keep their capital to survive and accept overdue debts by 150%. . Since then it was considered as a bad financial situation, this information is networked in the whole banking system so businesses are no longer able to access credit loans in any other banks. Since then the debt restructuring, debt rescheduling  under the policy of the current bank does not seem to work for these businesses. Another reason is that although the Resolution clearly states that the State Bank of Vietnam should continue instructing credit institutions to implement measures to assist enterprises in accessing credit loan. Banks tend to tighten credit and reduce loaning rates.

. Assessment on reduction of business costs for enterprises

The resolution also mentions a number of measures to reduce the cost of doing business. However, after nearly one year the Resolution has taken effect , these solutions do not seem to really support businesses. Typically, the adjustment of land rental reduction for businesses. In the Resolution, the Ministry of Finance shall chair  and coordinate with the concerned ministries and agencies in the adjustment of the land rent reduction for enterprises. However, the enterprises assume that the land rental for agricultural production to businesses are still high while farmers are not subject to this tax. This unfairness puts great pressure on businesses.

Likewise, after many years of export-oriented enterprises reacting to the charge that not based on the law of shipping lines, in November 2016, the Government issued a Decree 146/2016 regulating shipping business enterprises must be  public the shipping charges. However, the Decree does not provide sanctions when detecting transportation enterprises making price in order to ending  the current unhealthy competition.

As such, it can be seen that policies for helping businesses to reduce costs of businesses, of some ministries and branches have not been effective.

V. Assessment on the protection of legitimate rights and interests of enterprises

Regarding the protection of legitimate rights and interests of enterprises, the Resolution states that "the ministries and agencies concerned should inspect, examine and audit in the direction of integrating, coordinating and inheriting the results of activities between agencies" to minimize the inspection. At the same time, people's committees of provinces and cities under central authority shall conduct inspections no more than once a year. According to the results of the survey, in 2016, enterprises were inspected on average 2 times. This can be considered acceptable level by businesses.  However, there are still about 13.8% of enterprises were inspected from 4 or more in 2016. In enterprises with 2 or more inspections, 52.4% of businesses thought that content of the inspections was the same. It is noteworthy that specialized inspections, especially for food processing enterprises, were becoming burdensome due to the supervision of many ministries: Ministry of Agriculture and Rural Development, Ministry of Health, Ministry of Industry and local authorities. Therefore, in the coming time, it needs to  strengthen the inheritance of inspection results between agencies to reduce the overlap in theinspection content.

By: Translator: HaiYen - Business Information Center (BIZIC)


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