return icon Vietnamnet.vn

Private businesses should be allowed to provide public services: experts

The Vietnam Chamber of Commerce and Industry (VCCI) has released a report on the role of private businesses in providing public services in Vietnam.

Legal documents list 20 sectors that are not open to private investors, including industrial explosives manufacturing and trading, bullion gold production, banknote printing, and others.

 

 

{keywords}

 

In theory, private businesses are capable of providing many kinds of goods and services that are included in the list and the list of prohibited business fields.

However, a lot of fields remain inaccessible to private businesses, because of the lack of completed legal framework. The mechanisms on choosing investors through bids and natural resources auctions still have not been perfected, according to VCCI.

Private businesses, for example, technically are not prohibited from manufacturing and providing weapons, military equipment and goods. Legal documents say this is a conditional business.

The agencies with demand for military goods could use these products provided by private investors and choose the products through bidding. Private businesses could provide goods within a short time, at a low cost and with high quality.

However, as there has been no regulation on this issue, private businesses still cannot provide these products.

In theory, the state doesn’t hold a monopoly in coal mining. But in reality, coal mines are only allocated to the Vietnam National Coal and Mineral Industries Group (Vinacomin) and Dong Bac Corporation, two state-owned enterprises.

Meanwhile, under current laws, coal is a type of mineral that doesn’t require auctions for mining rights. As such, though private businesses are not prohibited, they cannot exploit coal.

A similar situation is seen in public services using the state budget. The Law on State Budget allows state agencies to allocate budgets to dependent units, including busiensses.

This means that if state agencies have dependent businesses operating in a certain business field, they don’t have to organize auctions or bidding.

 

In theory, private businesses are capable of providing many kinds of goods and services that are included in the list and the list of prohibited business fields. However, a lot of fields remain inaccessible to private businesses, because of the lack of completed legal framework.

 

In other words, opportunities for private businesses to provide services depend on the will of the state agencies.

The Ministry of Transport, for example, has the right to use the state budget to maintain the national railway system, and it assigns the Vietnam Railway Corporation to do this. It doesn’t organize bidding to choose contractors to provide maintenance services.

“So, whether a private business can provide these services depends on the ‘ask-and-grant’ mechanism, not on the bidding mechanism which chooses investors in a fair way,” the report of VCCI said.

VCCI also pointed out that service users are more satisfied about services provided by private businesses than from the state.

In the healthcare sector, for example, 45 percent of polled people said they were satisfied with the services provided by private businesses, and only 11 percent with the services by them state.

Regarding notarization services, the proportion of service users satisfied with services provided by private units is 46 percent, while the figure is 26 percent for services provided by the state. In the public transport sector, the figures are 30 percent and 10 percent, respectively.

Dau Anh Tuan, head of the Legal Department of VCCI, said many public services are provided by state agencies in a closed process.

This is not transparent enough, because state agencies both create policies and implement them, and control compliance with laws as well, which isn't in line with the modern market economy.

In other words, the state acts both as a referee and player on the playing field.

Loc commented that where private investors are present and provide services with transparency, the service quality will be high. The state should only do things that private investors cannot do or don’t want to do.

Privatizing public services, according to Loc, is ‘using one stone to kill many birds’. The state will not have to do things such as trade and investment promotion, or certificate granting, thus cutting costs and restructuring the apparatus.

If so, the state could gather its strength on the most important task – building an institutional mechanism, which determines national competitiveness.

In addition, privatizing public services can also help avoid the overlap in the functions of state agencies, and prevent embezzlement and conflicts of interest. This also helps to mobilize the financial resources and experience of the private sector. 

Tran Thuy

HCM City to provide all public services online at level 4 by 2030

HCM City to provide all public services online at level 4 by 2030

Ho Chi Minh City has set a target to provide 100 percent of public services online at level 4 by 2030. Level 4 is the highest level of online public services, which allows users to fill and submit forms, and pay fees online.

Embracing digital governance for upgrading public services

Embracing digital governance for upgrading public services

On its way to establishing its digital government, Vietnam is looking to take some examples from nations like Estonia, which managed to bring public services to a level that serves the public and emanates trust.

MORE NEWS

Shelter cares for 20 breast cancer patients in HCM City

No longer allowed to stay in a hospital, a breast cancer patient sold her house to rent and provide a shelter for 20 patients coming from all over the country to Ho Chi Minh City for chemotherapy and radiation treatment.

G&P Global Ratings raises Vietnam’s sovereign credit rating

The S&P Global Ratings on May 26 raised its long-term sovereign credit rating on Vietnam to “BB+” with a “stable” outlook on the back of strong economic recovery, according to the Ministry of Finance.

Domestic airlines offer millions of tickets for summer travel season

Anticipating that travel demand during the upcoming summer will rise sharply, and even higher than the pre-pandemic levels, local carriers are offering millions of air tickets.

American doctor’s endless love for Vietnamese ethnic minority cultures

When listening to him talk for hours and hours about the objects he found by chance on trips to different mountainous regions, it is easy to see Mark Rapoport's passion for the ethnic groups of Vietnam.

Two new Viettel inventions granted exclusive protection certificate in the US

Viettel Aerospace Institute (VTX), a member of Viettel Group, was officially granted an exclusive protection certificate by the US Patent and Trademark Office (USPTO) for two works in the field of optoelectronics and materials industry.

SEA Games 31 fuels recovery of local tourism industry

The hosting of the recent 31st Southeast Asian Games (SEA Games 31) between May 12 and May 23 can be viewed as a golden chance for the local tourism industry to recover after months of little activity due to the impact of the COVID-19 pandemic.

HCM City Mayor shows concerns as doctors turn from ‘heroes’ to ‘violators’

With great efforts in the fight against Covid-19, medical workers have been honored as heroes.

Stopping the licensing of new airlines, restricting the expansion of fleets

Controlling the number of new airlines until the market recovers and restricting licensing to expand fleets in the immediate time are solutions proposed by the State Capital Management Commission (SCMC).

Luxury-tax hike should be postponed until after 2024

Discussing the luxury tax law, experts said it is necessary to design a reasonable taxation roadmap and begin raising the tax only after 2024.

Huge haul in new markets for Vietnam’s tra fish exports

Demand for Vietnam’s tra fish (pangasius) is up in major markets, driving the export of the catfish overseas, reports the Vietnam Association of Seafood Exporters and Producers (VASEP).

Facebook collects money from partners to pay tax in Vietnam

The amount of money Facebook is planning to collect from Vietnamese partners accounts for 5 percent of invoice value. The money will be used to fulfill tax obligations.

Vinh Phuc: Wall collapse kills three people

Three people were killed and another seriously injured in the northern province of Vinh Phuc after a wall of a house collapsed and buried them.

JPMorgan Chase announces fresh capital injection into VN

JP Morgan Chase on Thursday announced a capital injection of US$123 million into its branch entity in HCM City, bringing the firm’s total capital investment into Viet Nam from $77 million to $200 million, or VND4.6 trillion.

Vietnam ready to facilitate long-term business and production of foreign firms

The nation continues to pay close attention to and attaches great importance to improving the investment environment and creating favourable conditions in which foreign enterprises can conduct long-term production business in the country.

Family of four found dead in Hanoi in apparent murder-suicide

Four members of the same family were found dead in an apartment complex in Hanoi's Hoang Mai District.
back_to_top