Private sector’s role in national economic development

The 12th National Party Congress, which has insisted on building a socialist-oriented market economy, considers the private sector a key driver of the national economy where stakeholders in different sectors are equal under law.

Associate Professor Doan Minh Huan, Deputy Editor-in-chief of the Communist Review, said “Ensuring equality between economic sectors provides the private economic sector with more opportunities to access land and credit, even the resources of the public sector. The policies on public-private cooperation have ensured that the private sector will cooperate with the state sector to exploit the available resources.”

Most private companies are small and lack the connectivity and capacity to respond to risks. Tran Kim Chung, Deputy Director of the Central Institute for Economic Management, underscored the need to ensure healthy competition and equality between businesses so that private enterprises can grow.

According to Chung, “the most essential thing is to improve the market mechanism. We should enhance transparency, renovate the state management, stabilize the macro-economy, and eliminate problems that reduce investment effectiveness.”

To support the contribution of the private sector to the national economy, Vietnam has implemented corporate solutions in which businesses identify their competitive advantages and disadvantages, focus investment on their core business, and improve the management capacity.

Pham Thi Thu Hang, Secretary General of the Vietnam Chamber of Commerce and Industry, said “The Chamber is identifying obstacles faced by enterprises for a report to the government. In addition to a government resolution on supporting and developing businesses until 2020, we are devising an action plan to help private companies and SMEs.”

Addressing the recent Vietnam Business Forum, Prime Minister Nguyen Xuan Phuc reiterated the government’s commitment to perfecting market institutions policies, and laws, continuing administrative reform, enhancing national competitiveness, and facilitating conditions for the domestic private and FDI sectors.

He said “FDI businesses should trust in Vietnam’s reforms and accelerate the transfer of advanced technology, human resource training, and the sharing of corporate governance experience. FDI enterprises should also honor their responsibility to society and join hands with Vietnam in protecting natural resources and the environment.”

In the socio-economic development strategy until 2020, Vietnam has pledged to create the most favorable conditions for Vietnamese enterprises, especially private businesses, to promote competitiveness and economic self-reliance.