The key point of the resolution is the presence of Party Committees and units in building programs and plans to implement the resolution, examine, assess and review the implementation. The Party Central Committee’s Economics Commission will join forces with relevant agencies to review the implementation and report the results to the Politburo and the Secretariat of the Communist Party of Vietnam.

This means that the resolution implementation will be supervised closely and the most important purpose is ‘developing a strong contingent of businessmen.

After nearly 40 years of doi moi (renovation), Vietnam has 900,000 businesses, or 9 businesses per 1,000 people. The figure is very low compared with the region and the world, as well as the country’s demand.

The business community has been facing numerous barriers in policies and policy implementation. But this is understandable: the national economy is still under the transition period when the legal framework is yet to be completed.

Former Head of the Central Institute of Economic Management (CIEM) Nguyen Dinh Cung commented that Vietnam's business legal system has "8 Nots" such as: " not clear", "not specific", "not transparent", "not reasonable", "not stable", " not effective" , "not valid" and "not predictable".

The comment coincides with statistics in VCCI’s (Vietnam Chamber of Commerce and Industry) provincial competitiveness index (PCI) report. The number of businesses which said they could predict changes in the central legal system in 2013-2021 was on the decrease. The highest figure, 15.75 percent, was seen in 2014, while in 2021, only 4.55 percent said ‘yes’ to the question about whether policies are predictable for them.

Regarding the question about the predictability of the law enforcement, 8.27 percent of businesses said in 2014 that they could foresee the provincial authorities’ implementation of legal documents, while the figure dropped to 5.56 percent in 2020. 

The major reason behind this is the decline in state management agencies’ awareness of market economy. Laws are designed to ‘manage’ and ‘control’, rather than ‘create’ a fair and transparent environment for businesses.

The story about the recent mushrooming of licenses, sub-licenses and licenses at many lower levels after a series of campaigns on cutting business conditions to simplify procedures in 2017 and 1999-2000 is a typical example.

After reviews and business condition cuts, the list of conditional investment fields has shrunk with just 227 conditional business fields (according to the 2020 Investment Law). 

This is a breakthrough approach in terms of state management, shifting from "choose - grant" to "choose - drop", thereby, realizing the provisions of the 2013 Constitution on people's freedom to do business in the fields that are not prohibited by law.

The independent review in 2016 conducted by CIEM found that the total number of required business conditions had reached 6,000 as of the end of 2016, and of these, 3000 conditions were found as ineffective in state management and they interfered with enterprises’ business operations.

In 2016-2018, the movement of cutting unnecessary business conditions became very strong among ministries and branches. The government then promulgated a decree that amended many decrees with stipulations on business conditions. 

According to a Government Office’s report in mid-2019, ministries and branches officially removed and simplified 3,425 out of 6,191 required business conditions.

However, analysts commented that the business environment improvement seems to have slowed down since 2020. The existing business conditions still put barriers and limitations in terms of business freedom for enterprises.

VCCI’s PCI report showed that enterprises are still meeting difficulties in implementing the regulations on business conditions, thus leading to enterprises’ operation cost increases.

About 61 percent of businesses said they face difficulties when following procedures to obtain licenses for the enterprises in conditional business fields. The inconveniences in business certificate licensing is the reason that forced 21.7 percent of enterprises to postpone or cancel their business plans. Meanwhile, 61.36 percent of enterprises have to pay unofficial fees to obtain licenses.

The figures prove that the costs of law compliance remain a heavy burden on businesses

Party Secretary General Nguyen Phu Trong said at the meeting on preventing and combating corruption on May 10 that it is necessary to inspect and clarify the responsibilities of institutions, individuals, and leaders in building and promulgating mechanisms, policies, and laws with legal loopholes and inadequacies.

Tu Giang