Chairman of the Hanoi People's Committee Nguyen The Thao spoke with the Vietnam Business Forum about how the capital city enhances its competitiveness and attracts investment resources for socio-economic development.

* The goals that Hanoi city sets for this year are improving its image and enhancing provincial competitiveness index (PCI). Could you tell us how the city defines these goals?

Attracting resources for development investment is always one of the top priorities of Hanoi. Every year, foreign-invested and private enterprises make huge contributions to the city’s budgetary revenue.

In 2013, Hanoi carried socio-economic development tasks with a lot of difficulties which affected budgetary balance, social security needs and social welfare.

However, the foreign-invested sector still maintained good growth last year. Specifically, foreign companies paid 13.4 trillion VND to the State budget in 2013, up 16 percent over 2012, and raked in an export turnover of 3.6 billion USD, equal to 48.6 percent of the city’s total exports. Foreign companies were licensed to invest 1.3 billion USD, equal to that in 2012, in 470 new and existing projects, and disbursed 900 million USD in the year. In 2013, the city granted business establishment certificates to 14,950 companies with a total investment capital of 100 trillion VND (nearly 5 billion USD), up 12 percent in enterprises and 33 percent in capital value over 2012.

In 2014, we set out eight key tasks. The top priority is to remove difficulties for enterprises, provide favourable conditions for them to develop and mobilise resources of the business community for the city’s comprehensive and sustainable development.

This year, although it does not use the theme of "theyear of administrative discipline”, the capital city still considers this a key task and fundamental solution. While informing, mobilising and training, the city will also intensify unscheduled inspection. The objectives are to raise the awareness and sense of responsibility of public officials at the service of enterprises and citizens, as well as bolster the image and enhance the PCI of the city.

* Despite enormous efforts, some PCI components of Hanoi still declined. Could you tell us the reason why?

This reality requires serious thinking of city leaders, unit leaders and public officials to take specific, drastic actions to regain the trust of the business community.

However, we must take into account the context of Hanoi. The sharp drop of the PCI standing of Hanoi is caused by its unique characteristics and certain difficulties. First of all, the workload pending for the city is very huge, diverse and complex.

Next, Hanoi has a very fiercely competitive environment because it has many more companies than other provinces and cities. Hence, they have more difficulty accessing public utilities services and administrative procedures. Besides, the change in administrative boundary caused many changes in general and specific planning which has led to changes in granting construction permits.

Some administrative procedures are being overloaded, such as tax declaration, business registration, customs and insurance procedures. This will of course take more time and expense of enterprises and distress them and the service agencies as well. In addition, land prices in Hanoi are always the highest in the country and this sensitive field usually upsets people unsuccessfully trying to take it.

Meanwhile, the capacity and responsibility of many businesses in performing State regulations is limited, leading to their repeated actions to ensure legality. This also affects their sense of the city’s investment environment.

* What solutions will the city take to improve the PCI standing and draw more investment capital in the coming time?

I think the most important solution is to unify the understanding and awareness of civil servants in attitude, responsibility and service style when they perform public services. They must change their thinking from “administering enterprises” to “serving enterprises”. The city will build the service manner of public apparatus to investors, enterprises and citizens in a friendly, professional and comfortable manner.

Furthermore, Hanoi will focus on business support services, labour training, market entry costs, transparency and access to information, access to land, informal charges, and proactive municipal leadership.

Recently, Hanoi made timely decisions to improve the situation. Directive 13/CT-UBND issued in June clearly points out existing weaknesses and detailed plans for simplifying administrative procedures, removing difficulties, boosting production, and supporting the market. Another clear move is the Hanoi Department of Natural Resources and Environment issuing Official Document 6684/UBND-TNMT in September on six-month periodical reports on projects with land-use requests. This is a good sign because land is always a weak point of Hanoi’s PCI. The land access index always stands at the bottom.

The latest meeting with the Vietnam Chamber of Commerce and Industry (VCCI) on October 3 deepened the city’s commitment and determination to improve its competitiveness. Even, the city’s leaders decided to open monthly meetings on PCI in order to monitor the situation more closely, improve the business environment and make necessary changes.

On the occasion of New Year 2014, I would like to send my best wishes to all businesses. Hopefully, they will endeavour, accompany and support the city’s policies and jointly develop the city.

Source: VNA