Restructuring the Vietnamese economy in 2016 - 2020: 41% difficult to complete

Restructuring the Vietnamese economy in 2016 - 2020: 41% difficult to complete

In the afternoon of September 5, 2018, under the framework of the Australian Support for Vietnam's Economic Reform (AUS4REFORM) program, CIEM held a consultative workshop: "Mid-term review of the economic restructuring results in 2016 - 2020 "with the aim of promoting and improving the efficiency of Vietnamese economic restructuring process.

At the seminar, Ph.D. Nguyen DinhCung, Director of the Central Institute for Economic Management (CIEM), said that, up to now, the implementation of the economic restructuring process has 25.8% of the tasks implemented have clear results, 57.5% of tasks being implemented but no clear results, 16.7% of tasks implemented but no results.

Overall, there are 24% of restructuring targets planned to complete, 32% is likely to be achieved, and 41% is difficult to complete. It can be said that, after Australia supported the Government of Vietnam to carry out economic reforms, Vietnam's economy has had many positive changes: stable macroeconomy; relatively high recovery growth; quality of growth has changed positively compared to the previous period.

Besides the achievements, there are also blemishes that need to be addressed such as slow improvement of public investment management quality; the gap between Vietnam and ASEAN4 has not changed significantly; digital economic environment is worrying; the readiness for future industry is "not big" and still ranked low in ASEAN.

According to Ph.D. Nguyen DinhCung, seeking development momentum for the period 2018-2020 is the best solution for the economic restructuring to develop smoothly. It is essential to focus on competitive solutions to improve economic efficiency, "without competition, there is no development of science and technology." SOEs are constrained by their ownership. Therefore, in order to restructure SOEs, it is necessary to focus on restructuring comprehensively, investing and supporting for good, well-off, potential developing enterprises, instead of restructuring the loss-making projects.

Besides, at the workshop, Mr. Vu SyCuong, an Asscociate Professor at Academy of Finance, Ministry of Finance also presented challenges in public finance reform in Vietnam such as: Challenges to state budget revenue policies like unsustainable revenue sources, tax incentives and its consequences to state budget, the efficiency of tax revenue when restructuring SOEs and the economy…; the challenge of overspending and public debt; issues of public investment; challenge with fiscal decentralization; Challenges of financial management mechanism, transparency in state budget management. However, the sad thing is that only 12 provinces achieved more than 50% of the POBI score, according to the POBI 2017 rating. This means that there are too few areas of public having transparency in state budget management.

According to lawyer Le Van Ha, as regards  the law, problem of restructuring still exist many issues: Contents and nature of  Report documents on investment policy, research report about the feasibility of the program is incomplete, the balance between the content, the decision-making process and the issues affected by the decision.In addition, there are too many "administrative procedures"; According to statistics, there are more than 7200 administrative procedures, implementation time and completion of administrative procedures prolonged, greatly affecting the business activities of enterprises.

Proposed solutions for economic growth, CIEM leaders emphasized that it is necessary to continue implementing existing solutions such as Resolution No.19, Resolution No.35, dealing with bad debts ... At the same time, it is vital to increase scale, speed and ensure substantive content, sufficient.There must be an independent experts group to evaluate the draft decree on business conditions, specialize inspection... before submitting to the Government or the Prime Minister.

At the same time, proposing to implement incentives such as incentives for FDI enterprises, solve unreasonable taxes, fees, export and import, support enterprises to expand export markets.