Vietnam’s business environment has seen remarkably improvements, said Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc at a conference on December 17.

Wood processed at Woodland Joint Stock Company in Tuyen Quang province.
(Illustrative image. Source: VNA) 

However, the country still needs to step up reform process in order to become one of the top four in ASEAN in terms of business climate, he said at the conference, which was held to announce a report about how firms felt about the Government’s efforts to improve the business climate and national competitiveness.

From 2014 to 2018, Vietnam jumped 30 places to 69th in the World Bank’s Doing Business ranking, but still needed to climb a further 42 places to be among the ASEAN 4.

“It is a tough road ahead,” Loc said. “We should not be satisfied with what we have achieved. We need to do more.”

Reforms in many sectors and State management agencies remained disappointing, he added.

On a positive note, tax payments were an indicator that Vietnam had achieved significant reforms with the time cut from 498 hours to 384 hours per year to complete procedures, but that was still two times higher than the average in Asia-Pacific (173 hours).

Protecting minority investors and resolving insolvency had not seen any significant reforms, and property registration shared a similar picture.

The VCCI survey found that firms still had to pay informal charges and faced difficulties in accessing bank credit.

“This stagnation in reforms was a barrier that needs to be resolved," Loc said.

The VCCI also found the percentage of firms that never or rarely predicted policy changes increased from 42 percent in 2014 to 67 percent in 2018, which was a problem, he said.

“We really need an institution that is transparent and tough like a diamond,” he stressed.

Dau Anh Tuan, head of the VCCI’s Legal Department, said that if no improvement was made, it would be difficult for Vietnam to achieve its goal of having 1 million firms by 2020.

He estimated that if the 2015-18 average growth rate of 17.3 percent was maintained, the number of firms would only reach 984,000 by the end of 2020.

“2020 will be the year to gear up reforms from both central and local levels. Vietnam needs stronger reform measures to support businesses”.