Why does Vietnam only have 4 USD billionaires, while many other super-rich are hiding?
Up to now, Vietnam has only had 4 dollar billionaires, this number is still very small compared to the world, and no business has yet appeared in the top of the world's leading businesses.
Businesses operating in a risky environment
“Since 1991, the Law on Private Enterprises (DNTN) has legally recognized the existence of the private economy in Vietnam. But up to now, Vietnam has only had 4 dollar billionaires, this number is still very small compared to the world, and no enterprise has yet reached the top of the world's leading enterprises.”
That was the sharing of Dr. Nguyen Dinh Cung, Director of the Central Institute for Economic Management Research, at the seminar on the role of the private economy on October 5 organized by Investor Magazine.
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| Vietnam has only 4 dollar billionaires recognized by the world. |
The reason for the above situation, according to Mr. Cung, is that in Vietnam today, there is freedom of business, but there is no safety in business activities.
Specifically, our business environment still has many risks. Vietnamese enterprises, in addition to the usual risks, have to face legal risks. This comes from the legal system that is not specific, not clear, not transparent, not effective, not efficient... Faced with arbitrary and arbitrary application (in terms of law), for an entrepreneur, they cannot calculate long-term, the best way is for them to do small and not big, not official.
On the other hand, according to this expert, for businesses that want to grow, they cannot grow. For a business with a good business idea, they need resources to develop, but they can only borrow from brothers and relatives. Meanwhile, other resources that are large enough are allocated in a request-grant manner, instead of based on quality criteria, whoever does well will be given capital. The most obvious is the allocation of land resources.
Mr. Cung also expressed doubts about the figures that private enterprises only contribute 10% to GDP, because if calculated correctly, this figure should reach about 30% of GDP.
From another perspective, Dr. Nguyen Duc Kien, Deputy Chairman of the National Assembly Economic Committee, said: Many Vietnamese enterprises are not interested in sustainable development methods, mainly developing in the direction of "instant noodles", wanting to have fresh money and real rice right away, not developing in a professional direction, participating in the global value chain. Even if the Government creates many conditions, if entrepreneurs and enterprises themselves do not renew themselves, it will be very difficult for us to witness a breakthrough in the short and medium term.
“We must frankly admit that, in addition to the advantage of creating jobs compared to state-owned enterprises and FDI enterprises, the contribution of the private sector to the budget revenue is still limited. Very few billion-dollar enterprises in Vietnam have grown from the application of science and technology, but mainly from the real estate business sector or are associated with real estate business,” Mr. Kien observed.
Adding to this comment, Mr. Nguyen Van Phung, Director of the Department of Large Enterprise Tax Management (General Department of Taxation) spoke in his personal capacity: 1,000 large tax-paying enterprises are mostly banks, insurance, and real estate.
“The story of the economy’s income distribution is clearly distorted. It should be focused on production, but currently it is mainly for service industries such as banking, tourism, etc.,” said Mr. Phung.
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| Private enterprises are still small and weak. |
"Out of sync" will lead to business losses, even bankruptcy.
Many business leaders themselves have their own concerns. Mr. Tran Van The, Vice Chairman of the Board of Directors of Deo Ca Group, could not hide his anger when talking about the way BOT is treated.
Mr. The shared: Private investors doing BOT projects like Deo Ca all feel that they are not treated equally in the process of negotiating and working with state agencies. Along with that, there are also certain conflicts in legal documents, for example, the Enterprise Law allows the transfer of shares and the right to contribute capital, but the Investment Law sets out many complicated regulations for project transfers.
“Many state administrative documents lack practicality. For example, the interest rate policy for BOT projects in the past year has seen a circular revised four times on the same issue. And strangely, the final draft is exactly the same as the previous circular. “We see that these circulars represent a regression in policy work,” Mr. The cited.
In particular, competent state agencies show indifference when the investment process of enterprises encounters difficulties. This can put pressure on the enterprise when the contract commitment is not met by Party A partner according to regulations.
Mr. Trinh Hien Trung, General Director of TH Herbals, recommended building a policy mechanism to attract large enterprises with enough resources to participate in order to promote private economic development.
“The State and Government must develop a set of national standards on product quality to create fair competition between businesses, and encourage genuine businesses to reach international standards so that they can export their products internationally. In addition, it is necessary to encourage businesses to invest in technology and create good and effective products. From there, businesses can develop and pull the Vietnamese economy along,” Mr. Trung shared.
Professor Nguyen Mai, Chairman of the Association of Foreign Investment Enterprises, said: Enterprises that seize opportunities, quickly innovate technology and product designs to meet market demand will grow quickly and be highly effective. On the contrary, if they are "out of sync", their business will suffer losses and even go bankrupt.
