Investment environment - a measure of the efforts of a creative government

(Baonghean) - Vietnam's innovation and international integration are being implemented and are increasingly achieving positive results, notably the improvement of the investment environment.

Vietnam's innovation and international integration are being implemented and are increasingly achieving positive results, notably the improvement of the investment environment. These achievements are not only confirmed by the impressive results in terms of economic growth momentum and speed; the number of FDI projects and the number of newly registered and re-operated enterprises, along with the amount of capital implemented and supplemented, etc., but are also recognized by the fact that Vietnam has continuously improved its rankings in the BCI - Business Confidence Index (Eurocham); Vietnam Consumer Confidence Index (by ANZ Vietnam); National Credit Index and National Competitiveness Ranking; Vietnam Innovation Index and Credit Ratings of many commercial banks in Vietnam.

Officials of the Southeast Economic Zone introduce investment potential in Nghe An to foreign investors. Photo: Nguyen Son

In particular, the annual report on the ease of doing business index (Doing Business report 2016) published by the World Bank (WB) has shown a fairly continuous improvement: In 2012, Vietnam ranked 99/183 countries. By 2014, it increased to 93/189 countries; in 2015, it increased to 91/190 and the recently published Doing Business 2016 report shows that Vietnam ranked 82 out of 190 economies evaluated.

The business environment ranking is based on 10 criteria including: Starting a business; Applying for a construction permit; Accessing electricity; Registering property; Borrowing capital; Protecting small investors; Paying taxes; Trading internationally; Enforcing contracts; Resolving insolvency.

This year, Vietnam has improved in some criteria such as: Access to electricity increased by 5 places to 96th in the ranking. The criterion of protecting small investors increased by an impressive 31 places to 87th. The criterion of paying taxes increased by 11 places to 167th. The criterion of international trade also increased by 15 places to 93rd.

Vietnam also has a high ranking on the world information technology map: ranked No. 1 globally in the outsourcing software service industry; Top in the mobile application economic index in ASEAN. In 2016, Vietnam's e-Government index was ranked 89/193 countries by the United Nations, up 10 places compared to 2015.

To date, Vietnam has signed over 90 bilateral trade agreements, nearly 60 investment promotion and protection agreements, 54 double taxation agreements and many bilateral cultural cooperation agreements with countries and international organizations; at the same time, it has trade relations and exports goods to 230 countries and territories. Vietnam has had positive relationships with international financial and monetary organizations such as the Asian Development Bank, the International Monetary Fund, and the World Bank.

Currently, in addition to the WTO, Vietnam has signed 11 FTAs: ASEAN Free Trade Area (AFTA); ASEAN - China Free Trade Area; ASEAN - Korea Free Trade Area; ASEAN - Japan Free Trade Area; ASEAN - Australia and New Zealand Free Trade Area; ASEAN - India Free Trade Area; Vietnam - Japan Economic Partnership Agreement and Vietnam - Chile Free Trade Agreement); FTA with Korea and the Eurasian Economic Union; FTA negotiations with the EU have been completed; 6 other FTAs ​​are being negotiated, such as EFTA (including 4 countries: Switzerland, Norway, Liechtenstein and Iceland); FTA with Taiwan; FTA with Turkey and the Regional Comprehensive Economic Partnership Agreement (RCEP); FTA with Israel (started in early December 2015); AEC was formed in late 2015.

Vietnam is expanding free trade market relations with 55 countries and economies, including 15 countries in the G-20 Group. 60 TPP countries have recognized Vietnam as a market economy.

Japanese garment factory in Yen Thanh district. Photo: PV

The highlight of the investment environment improvement is the reduction of tax rates, the time for tax payment is also reduced rapidly. In addition, interest rates and credit conditions for businesses are also improved in the direction of lower and more open.

Administrative procedures and the quality of public services have also been improved in the direction of shortening the time for business registration and customs clearance; increasing the nature of business liberalization and market business equality, regardless of economic sectors; promoting the equitization of state-owned enterprises, expanding "room" for foreign investors.

Efforts to improve the investment environment in line with integration commitments are driven by a change in thinking from economic integration to comprehensive international integration, proactively innovating the growth model from mainly extensive development to mainly intensive development, based on productivity, technology and environmental protection.

The continuous improvement of the investment environment is the result and measure of the efforts of a creative, honest, friendly and business-oriented Government. It is also one of the foundations for creating synergy for the Vietnamese economy to continue to develop and integrate more effectively and sustainably into the international community.

Dr. Nguyen Minh Phong