Comments on the draft Resolution on a number of key policies and solutions to support businesses

What do Nghe An businesses say?

The Draft Resolution has demonstrated the consistency of the Party and State's guidelines, policies and guidelines on encouraging business development; the freedom of business of the people and businesses; maximum support for business development, considering removing barriers and difficulties for businesses as the top political task; clearing bottlenecks, mobilizing and liberating social resources for investment and development. In particular, ensuring equal rights for all types of businesses and economic sectors in accessing resources and policies.

However, the business community believes that the Draft still has some unclear points in both general and specific goals. Accordingly, the Draft needs to aim at major goals such as supporting businesses to adapt, recover and develop sustainably, in order to realize the country's development goals according to the Resolution of the 13th National Party Congress: By 2025, our country will be a developing country with modern industry, surpassing the low-middle income level; by 2030, it will be a developing country with modern industry, high-middle income; and by 2045, it will be a developed country with high income. Regarding specific goals, the Draft should consider, complete and supplement in the direction of setting out criteria-based targets corresponding to the country's development goals by 2025, towards 2030 and 2045.

Small and medium enterprises expect to have many policies to support and restore production after the Covid-19 pandemic. In the photo: Producing spoons for export at Hong Son Production and Trade Company Limited, Do Lang Industrial Park (Nghi Loc). Photo: Thu Huyen

The draft proposes 8 groups of tasks and solutions that need to be implemented immediately and in the long term, focusing on solutions such as urgently removing existing legal obstacles and barriers that have not been thoroughly resolved; continuing to support cost reduction for businesses, increasing access to preferential capital sources and State support resources, etc.

According to the feedback of many enterprises in Nghe An, accessing loans with preferential interest rates of 2% stipulated in Decree 31/2022/ND-CP in the spirit of the Draft is very difficult. Regarding this issue, Mr. Huy Trung - Director of Nhat Trung Anh Trading and Service Company Limited stated: “The Covid-19 pandemic lasting from 2020 to the end of 2021 has seriously affected businesses. During that time, businesses were almost closed. Up to now, when returning to the "new normal" reality, many businesses are facing great pressure due to high input costs of raw materials and fuel. Access to the 2% interest rate support package from the State budget for loans of enterprises, cooperatives, and business households is what businesses are looking forward to..The draft and the government should pay more attention and specify this policy so that small and medium-sized enterprises like us can access it more easily."

At Point 5.a of the Draft, ministries, branches and localities are required to “organize regular dialogues between ministries, branches, local authorities and enterprises to promptly resolve difficulties and obstacles of enterprises and assess the actual process of handling recommendations of the business community”. This is a very important task, which was identified in Resolution 35/NQ-CP in 2016 on supporting and developing enterprises until 2020 and has in fact been implemented relatively well by many ministries, branches and localities, including Nghe An. In order to effectively and substantially implement business dialogue activities, it is necessary to have the participation of micro, small and medium enterprises, accounting for 98% of the total number of enterprises operating in Nghe An.

Regarding this field, Mr. Hoang Viet Duong - Chairman of the Association of Small and Medium Enterprises of Nghe An province said that regular dialogues between local authorities and enterprises are very necessary. Through dialogues, the authorities will better understand the difficulties and obstacles and have timely solutions. Recently, due to the impact of the Covid-19 epidemic, dialogues between Nghe An provincial authorities and the local business community have slowed down compared to before.

In the coming time, provincial associations should sit together and agree on some necessary contents to coordinate more closely and specifically with the government in dialogue with the highest frequency and most effectiveness.

Mr. Hoang Viet Duong - Chairman of the Association of Small and Medium Enterprises of Nghe An province

Regarding viewpoints, orientations, tasks and solutions, the Draft has mentioned quite specifically. However, according to the opinions of some enterprises, the Vietnam Chamber of Commerce and Industry (VCCI) and the Business Association, the Draft should be more specific, clarifying the proportion and role of the private enterprise sector compared to FDI enterprises, because domestic enterprises are the long-term, sustainable driving force for the development of the locality as well as the country.

Specify business support

The draft sets the target of “reaching 1.5 million enterprises” but it is unclear whether these enterprises are “registered” or “in operation”. Determining the number of operating enterprises can more closely reflect the “health” of the economy, the level of favorableness of the investment and business environment, and promote and create conditions for business entities to operate. To achieve this goal, it is necessary to promote the conversion of individual business households into enterprises, because currently this force in our country is very large and quite popular with more than 5 million households.

Production at Trong Phuc Garment Company Limited in Dien Chau district. Photo: Thu Huyen

According to Dr. Nguyen Dinh Cung - former Director of the Central Institute for Economic Management, in 2021, Nghe An had about 12,000 operating enterprises, accounting for about 1.4% of the total number of operating enterprises nationwide; on average, there were only 3.5 enterprises/1,000 people, less than half of the national average.

The business community of Nghe An in general and each business in particular are still very weak in all aspects compared to the national average. It is worth mentioning that there is no internal motivation and external factors to support and promote Nghe An businesses to develop in both quantity and quality.

Dr. Nguyen Dinh Cung

Regarding the promotion of the exploitation of incentives of FTAs, the Draft needs to specify the support for enterprises to take advantage of tariff incentives, because this is the most easily realized benefit aspect of FTAs ​​from the perspective of enterprises. In addition, it is necessary to create conditions for small and medium enterprises to access loans more easily, and to completely resolve the shortcomings, overlaps, and conflicts due to regulations in legal documents in the fields of investment, land, construction, and natural resources and environment.

Mr. Truong Van Hien - General Director of Nghe An Agricultural Materials Joint Stock Company said: We have a bottled water production project, but after more than 2 years, we still have problems with connection. From provincial leaders, departments, branches to communes, everyone is very supportive, but the main problem lies in the documents, circulars, and regulations of ministries and branches.

It can be said that, in the current period, the Government's having a separate Resolution on enterprise development for the entire term shows its special attention to the cause of enterprise development, especially the private enterprise sector. However, in order for enterprises to develop, in addition to improving the business environment, creating conditions for domestic and foreign investors to invest in Vietnam and localities, the Government needs to thoroughly resolve the shortcomings, contradictions, overlaps, and unreasonable regulations in legal documents in areas related to enterprises.