VietNamNet Bridge - The public debt has hit a ceiling, the state budget is under strain, and enterprises’ competitiveness remains weak – all these will be great challenges for new cabinet.

The public debt has hit a ceiling, the state budget is under strain, and enterprises’ competitiveness remains weak – all these will be great challenges for new cabinet.

Citing an official report which says the public debt reached 62.2 percent of GDP in 2015 and the government’s debt reached 50.3 percent, La Ngoc Thoang, a National Assembly’s Deputy from Cao Bang province, said this would be a great challenge for the new government in the next tenure.

“The government debt comprises state-owned enterprises’ government-guaranteed debt. Meanwhile, many enterprises in the economic sector have been performing ineffectively, which is really a big concern,” Thoang said. 

The National Assembly’s deputy said that the high public debt, the high number of bankrupt enterprises, plus the difficulties in collecting debts in the context of the global integration and free trade agreements all have made Vietnam on a tight budget.

Therefore, he said, the new government needs to apply policies which give strength to enterprises to help them maintain production. 

The high public debt, the high number of bankrupt enterprises, plus the difficulties in collecting debts in the context of the global integration and free trade agreements all have made Vietnam on a tight budget.

This is the best way to increase the budget revenue, because it is enterprises which pay money to maintain the state apparatus.

“No one can say the figure of 20,000 dissolved and bankrupted businesses in the first three months of the year is ‘normal’. This is clearly a big challenge for the government headed by Prime Minister Nguyen Xuan Phuc,” he commented.

Meanwhile, Tran Khac Tam, a National Assembly’s Deputy from Soc Trang province, emphasized the importance of institutional reform. Hundreds of hours for customs and tax procedures have been cut. However, businesses still complain that procedures remain very complicated and time consuming.

"Reform must be considered the driving force for economic growth. If we stop the reform now, we will lag far behind other countries which are always moving ahead,” he commented.

Tam hopes that Phuc, who conducted the Program 30 on administration reform, has good experiences in the field to lead the apparatus to more brilliant achievements.

Tam, who is also a businessman, wishes that the government will pay appropriate attention to help improve Vietnamese enterprises’ competitiveness.

“We can feel the heat of TPP now. If Vietnam cannot manage well, it, being the weakest economy among the 12 member countries, would see its businesses swallowed by powerful international conglomerates,” he said. 

Noting that many seafood consignments exported by enterprises in his area have been rejected by European importers because of high antibiotic residue, Tam said many production fields have been developing without prior planning, which is a weak point for Vietnam in global integration.

Chief of the Government Office Mai Tien Dung also admitted that the weak competitiveness of Vietnamese enterprises will be a problem.


VNE