Renovation gains remarked

In the article, he pointed out that 40 years of implementing the Đổi Mới (Renovation) process has seen Vietnam transform from an inefficient centrally planned economy with a per capita income of just US$96 in 1989 to a projected level of over US$5,000 by 2025. This success is driven by the country’s sound development policies, bold reforms, and the relentless efforts of its people.

The country has consistently maintained an economic growth rate twice the average of developing countries, rising to become the world’s 24th largest economy by purchasing power parity (PPP), while also achieving significant social progress and improving the quality of life for its citizens.

He partly attributed such success to the private sector’s significant contributions, saying the sector has become a key pillar of the national economy, especially after the Party Central Committee issued relevant resolutions in 2011 and 2017. Currently, with nearly one million enterprises and about five million individual business households, the private sector contributes 51% of GDP, more than 30% of the state budget, creates over 40 million jobs, and accounts for 82% of the total workforce, proving to be a crucial driver of economic growth and social investment.

The private sector not only expands production, trade, and services but also plays a crucial role in improving labour productivity, driving innovation, and enhancing national competitiveness. The strong rise of many Vietnamese private enterprises has not only allowed them to dominate the domestic market but also establish their brands internationally.

Barriers identified

Despite its significant contributions, the private sector still faces numerous barriers that hinder its growth in scale and competitiveness. Outdated business models, small-scale operations, weak financial capacity, slow digital transformation, low investment in research and development, and limited technological innovation are some internal limitations to name.

In addition, private enterprises struggle to access capital, land, and high-quality human resources, while state-owned enterprises (SOEs) often fail to utilize these resources effectively. The legal system remains inconsistent, administrative procedures are complex, and the business environment presents many obstacles, including corruption and informal costs. Government incentives are not yet fair, with SOEs and foreign enterprises often receiving more support than private businesses in some cases.

According to the Party leader, such limitations stem partly from institutional and economic policy shortcomings as well as the business environment. These bottlenecks not only slow the growth of the private sector, by keeping its GDP contribution nearly unchanged for over a decade, but also hinder the economy from increasing value-added production, escaping the middle-income trap, and accelerating Vietnam’s progress toward becoming a high-income developed nation by 2045, as outlined in the Party’s Resolution and the expectations of the people.

He affirmed that the private sector must define its pioneering role in the process of national industrialization and modernization, and in enhancing national competitiveness, contributing to a dynamic and globally integrated Vietnam. By 2030, the goal is for this sector to contribute approximately 70% of GDP, with many enterprises reaching global competitiveness.

Bold reforms in dire need

To achieve this, the Party chief stressed, bold reforms in institutions, policies, and the business environment are essential, in order to maximize the potential of the private sector as a key driver of economic growth. A prosperous economy cannot rely solely on the state sector or foreign investment but must be driven by a strong private sector, leading innovation and national development.

He called for broad consensus across the entire political system and a fundamental shift in policy-making to overcome limitations and leverage the advantages of the market mechanism, enabling the private sector to enhance productivity and innovation. The state must adopt a market-oriented management approach that ensures the freedom of business, property rights, and fair competition for private enterprises. All barriers must be removed, policies must be made transparent, and vested interests must be eliminated from policy-making and resource allocation.

In his opinions, there should be no discrimination between private enterprises, state-owned enterprises, and foreign-invested businesses in any policy. In addition, the principle that “everyone has the right to do business in any sector not prohibited by law” must be upheld, by fostering policies that reassure investors, businesses, and entrepreneurs. Strengthening trust between the state and the private sectors will encourage enterprises to invest boldly, innovate, and participate in strategic economic sectors.

The Party leader revealed that a resolution on the private sector to be soon issued by the Politburo should encourage, support, and guide its development, creating a breakthrough momentum that marks the beginning of a new era for Vietnamese private enterprises. The development of the private sector must be recognized as a long-term national strategy and policy. Alongside the state economy and the collective economy, the private sector forms the core foundation for building a self-reliant, independent, and resilient economy.

Major solutions outlined

To meet the goal, he outlined that Vietnam should continue accelerating the completion of a fully developed, socialist-oriented, and globally integrated market economy as a prerequisite for the rapid and sustainable growth of the private sector. The country should effectively protect property rights, ownership rights, freedom of business, and ensure contract enforcement for private enterprises.

While strengthening the State-owned enterprise sector, particularly major state economic groups, he said, priority should be given to developing large-scale private conglomerates with regional and global influence. Support for small and medium-sized enterprises (SMEs) should be enhanced, along with fostering household and cooperative economies. Private enterprises should also be encouraged to participate in the country’s strategic sectors.

An important solution, according to the leader, is to reform institutions to build an administration that serves businesses and the nation. It’s also essential to fully unleash development resources for the private sector to enable effective access to critical resources such as capital, land, human resources, and technology. It’s imperative to strengthen the private sector’s deeper integration into the global economy, enhance Vietnam’s economic position on the international stage, and protect enterprises from economic risks.

In his view, the world is witnessing unprecedented advancements in science and technology amid a rapidly changing international environment. With resilience, determination, and an unwavering ambition, he said he believes, Vietnam is fully capable of achieving new socio-economic development miracles, and this can be done by a new generation of bold, innovative, and passionate entrepreneurs, alongside other forces.

Vietnam to formulate breakthrough policies for private economic sector development

VOV.VN - The Ministry of Finance (MoF) will draft a new resolution on breakthrough mechanisms and policies for the development of the private economic sector, in an effort to create more favourable conditions for private enterprises to grow and contribute to the national economy.