VietNamNet Bridge – The Vietnam Chamber of Commerce and Industry (VCCI) last Thursday announced the 2012 Provincial Competitiveness Index after conducting a survey among thousands of enterprises for their views abut the governance at the provincial level. Vu Tien Loc, chairman of VCCI, talked to The Saigon Times Daily about the reforms to improve the business environment.

Reforms in Vietnam mainly take root from the grassroots level. Do you find anything worth noting after eight years of survey for the Vietnam Provincial Competitiveness Index (PCI)?

It is worrying that almost all the easiest reforms have been undertaken, while the “thorniest” ones have yet to be done. Easy reforms like reforms in the procedures for business registration and market entry have been fully implemented by the pioneering localities and adopted by the following ones. Such reforms are simple because local leaders can oblige their subordinates to put them into practice.

Still, localities have much room left to carry out further reforms in a bid to help enterprises. For example, they can draw up development strategies for their localities, supply human resources and services, improve capacity of the State apparatus in general and access to land. It means there are a lot of things left to do, but the current progress is very slow. Institutional reform needs political determination to achieve a faster progress.

Do you find any reform model notable at the provincial level?

Ninh Thuan learns from the effective licensing model of Singapore. Quang Ninh has a board for investment promotion managed by the provincial chairman. These two models of investment promotion and business support are really remarkable.

Lao Cai, one of the best performers in the recent PCI scoreboards, has a very interesting slogan “Doanh nghiep phat tai, Lao Cai phat trien” (Businesses thrive, Lao Cai develops). The province no longer hangs up welcome signs when senior officials from other nations arrive, but it does when entrepreneurs arrive.

The chairman of Nghe An does not have any chair for visitors in his office. Everyone has to stand and leave immediately after the work is done. He is afraid that sitting will lead to long talks.

Currently, 40 cities and provinces have adopted resolutions on boosting competitiveness. A number of localities have worked out their grand plans, such as Nghe An. Many of them have drawn up action plans and assigned each department a specific task. Who fails to fulfill his task will even be transferred.

Only 33% of the enterprises participating in the 2012 PCI survey said they had plans for business expansion in the next two years, versus 70% in the 2006 survey. What could be a reason for this pessimism?

Enterprises are struggling with their own problems and it is understandable that they’re not satisfied with the authorities’ management.

For some localities, there is not much room left for reform, while reforms in State-owned enterprises and land are difficult, so they are moving slowly. Yet, the most important thing is since Resolution 04 was introduced, the focus has been given to Party reform. Thus, no one dares to do anything and as a result, activeness and creativity are badly affected. Everything must be discussed openly and will only be implemented with a common consensus, no one want to make the decision. Enterprises are moaning and groaning. One will criticize the others’ mistakes, not based on the specific results.  

PCI has become an indicator of provincial leadership. Have you been loved, or hated, because of this?

It is said that VCCI has been quietly creating a motivation for reform in Vietnam. At first, many people did not like me. The downgraded localities said VCCI did not calculate properly and made many angry responses. The responses are more and more positive, and PCI is taken for granted. No one is dissatisfied with me anymore.

Source: SGT