The Vietnam Chamber of Commerce and Industry’s (VCCI) Provincial Competitiveness Index (PCI) released on April 27 showed that the efficiency of administrative procedures has continued to improve significantly in recent years.

Eighty-seven percent of businesses agree that state officers handle works effectively, 83 percent say state officers are friendly, 80 percent say the time needed to follow administrative procedures is shorter than stipulated, 75 percent say they don’t have to travel many times to complete procedures, and 74 percent say the procedures are simple.

The figures show the business circle’s recognition of the progress made by state agencies in localities in terms of handling administrative procedures. 

One of the outstanding efforts in administrative procedure reform in recent years is the stronger application of information technology in providing public services. Online public services are becoming more popular at different levels, which reduces inconvenience and increases transparency.

Nevertheless, the survey found that administrative reform remains not a strong driving force for the business environment improvement. The simplification of administrative procedures mostly occurs in fields in which businesses and people don’t have much demand. The connectivity in administrative procedures is not high. Many administrative procedures still cause difficulties for enterprises to comply with. The administrative procedures in taxes and fees, land and construction continue to be the most troublesome.

The perception of businesses about inconvenience in complying with administrative procedures in the fields in 2021 were higher than the year before. 

More than 29 percent, 28.92 percent and 13.07 percent of enterprises said administrative procedures in tax and fee, land and construction, respectively, still are very inconvenient. The figures were higher than the 21.81 percent, 28.58 percent and 10.98 percent in 2020.

One of the problems causing inconvenience to businesses in 2021 was the complexity of legal regulations. It takes enterprises a lot of time to master and implement regulations. The problem was eased in 2017-2020, but it returned in 2021 (22 percent said this in 2020 and the figure was 26 percent in 2021).

The PCI report said that Covid-19 could be a reason. As pandemic developments have been complicated throughout the country, strong anti-pandemic measures were applied without detailed instructions, which caused confusion, leading to disruption in supply chains and high operation costs. 

Discouraging results 

While it is convenient to make business registrations, it is still difficult to follow procedures to obtain licenses for conditional business. In all provinces, the proportion of enterprises which say it is convenient to obtain licenses for conditional business is no higher than 60 percent.

Up to 53.7 percent of enterprises agree that the guidance for obtaining licenses for conditional business is clear and sufficient; 52.1 percent say that the real procedures are the same as stipulated; 38.9 percent say they don’t have difficulties when following administrative procedures; 43.4 percent say the time needed to follow administrative procedures is not longer than stipulated; and 39.1 percent believe that the costs for obtaining licenses for conditional business is no higher than the stipulated levels.

This means that there is a considerable proportion of enterprises that are not satisfied when implementing procedures for licensing. The inconvenience in obtaining licenses for conditional business was why 21.7 percent of businesses have had to postpone or cancel their business plans in 2021.

There have been many problems in land access. Since this matter concerns many ministries and branches, improvement is difficult to attain in many localities. Only 42.9 percent of enterprises said they had land-use right certificates in 2021, the lowest figure since 2006.

This is attributed to many reasons: administrative procedures to buy and lease land are complicated; land-use planning in localities still cannot satisfy the demands; the provision of information and data about land is not convenient; land prices increase rapidly; site clearance goes slowly while ‘clean’ land is lacking; and many problems in administrative procedures related to land ownership exist.

Not having land-use right certificate means that enterprises cannot ‘settle down’ and cannot think of scaling up production and business.

The inconvenience related to land was why 53.8 percent of businesses had to postpone or cancel their business plans in 2021.

The results show uneven improvements in different fields of administrative reform and there is still a considerable proportion of enterprises that do not see improvements.

VCCI believes that to continue efforts to reform administrative procedures, local authorities need to step up implementation of the government-initiated master program on administrative procedure reform in the 2021-2030 period.

Tran Thuy