VietNamNet Bridge – Deputy Prime Minister Hoang Trung Hai says enterprises should utilise opportunities when the country joins the Trans-Pacific Partnership Agreement (TPP).

What are the challenges that Vietnamese enterprises face when they join in the TPP or other free trade agreements?

In joining the TPP or any FTA, enterprises will face two issues: opportunities and challenges. It is the task of each enterprise to come up with its own strategy to maximise opportunities offered to it while taking proactive measures to cope with negative impacts that might affect its business.

Beginning in 2010 when Viet Nam was an observer of the TPP, the Government and concerned ministries and sectors had already provided enterprises with information about the TPP through the mass media.

Viet Nam is a country that has a high level of access to the internet, so any enterprise or citizen can easily search for information about the TPP, as well as the opportunities and challenges the country faces in becoming a signatory to the TPP.

In a nutshell, it comes down to whether the enterprises are interested in the TPP or not. They cannot complain that they lack information about the agreement.

More than 90 per cent of Vietnamese enterprises are small or medium-sized (SMEs). Their investment capital is limited. This is the key reason that their interest in the TPP's impact on their businesses is still limited.

Some National Assembly deputies have proposed that in the next five years, Vietnam should increase the number of enterprises from 500,000 to two million. In your opinion, what should the Government do to make the proposal become a reality?

I would say that 500,000 enterprises are too low of a number. Over the past three or four years, between 50,000 and 60,000 enterprises dissolved each year due to economic difficulties. This presents a big disadvantage for Viet Nam. To achieve the target of two million enterprises by 2020, the Government has adopted several measures to support the establishment of new enterprises. As a result, in the early months of 2015, a considerable number of new enterprises were established.

Another point I want to emphasise is that the Government's role is to serve as the negotiator and signatory to the free trade agreements, but it does not directly participate in the competition.

When the agreements take effect, it's the enterprises' responsibility if they want to survive in the big market. Of course, they have to do quite a lot of things, including the improvement of their business and legal knowledge, human resources and foreign language proficiency.

At present, up to 90 per cent of our labour force is now working in the SMEs. So to achieve the target of two or two-and-a-half million enterprises in the next five years, in my opinion the first thing we should do is change the enterprises' awareness about international integration.

Of course, the Government's responsibility is to continue carrying out administrative reform in order to enable private enterprises to develop. The Government is committed to stepping up the reforms of State-owned enterprises and public ones.

Deputies have also asked the Government to provide a level playing field for private and state enterprises to access resources during their business operations. How do you respond to their proposal?

A good business environment means having a good legal system, a co-operative administrative mechanism, and transparency and accountability of the monetary and financial apparatus. Of course, having a developed capital market with macro-stability is indispensable.

In short, the TPP has put pressure on the whole system, not just the enterprises themselves. Comprehensive administrative reform must come first because it is the key to open other businesses' doors.

Vietnam's economy in the recent past has heavily depended on China. Do you think joining the TPP will help Vietnam reduce its dependence on China?

I don't think the Government should advise enterprises not to do business with China and switch to other trade partners.

As I have mentioned above, they should have their own business strategies and have plans for the best and worst situations. In other words, they should know what their strengths and weaknesses are in order to survive in a tough competitive market nowadays.