Brian Jeffrey
During a recent seminar titled “Empowering Private Sector Growth Through Resolution 68 – Immediate Actions Required,” hosted by the Government’s Electronic Information Portal, Hieu underscored the critical importance of Resolution 68. The resolution conveys straightforward and impactful messages aimed at addressing long-standing challenges in the private sector.
Hieu contends that effectively applying Resolution 68 could mark a significant third milestone in the evolution of the private sector. The first was the acknowledgment of the private sector between 1988 and 1990, followed by the second milestone, which involved granting business rights and reforming administrative procedures, particularly regarding market entry, during the years 1999-2000, coinciding with the launch of the Enterprise Law.
“Resolution 68 is set to fundamentally enhance the quality of the private sector,” he remarked.
The current landscape of the private sector includes over 940,000 businesses and upwards of 5 million active household enterprises, making a 50% contribution to the GDP, over 30% to total state budget revenue, and employing around 82% of the nation’s workforce.
Numerous private companies have experienced substantial growth, established prominent brands and are now venturing into regional and global markets. Nevertheless, the sector still encounters various challenges that impede its growth, failing to meet the expectations and demands necessary to become a key driver of the national economy.
While reviewing the solutions outlined in the resolution, Hieu pointed out three main goals set by the Politburo:
Firstly, easing market entry: This involves eliminating administrative hurdles by reducing compliance costs and procedures by 30%, which marks a considerable advancement since the early 2000s.
Secondly, strengthening protection: A non-criminalization principle has been established, significantly minimizing risks for businesses.
Thirdly, facilitating access to resources: This allows private companies to gain better access to land, production facilities, financing, and human capital.
Bui Thu Thuy, Deputy Director of the Department of Private Enterprise and Collective Economic Development at the Ministry of Finance, described Resolution 68 as revolutionary.
She pointed out that prior restrictive business conditions, often seen as a “wall” preventing market entry, have been dismantled under Resolution 68.
This pivotal document introduces a post-check mechanism, enabling businesses to declare the quality of their products. Ministries and sectors have been instructed not to impose excessively stringent requirements on businesses, except in areas related to national security and public health.
“This is truly groundbreaking, akin to breaking down a wall,” Thuy expressed.
Thuy emphasized a crucial aspect: trust. The time has come for the Party and Government to show considerable confidence in the private economic sector.
The private sector’s contribution to GDP is over 50%, compared to approximately 20% from foreign direct investment and a similar figure from state-owned enterprises. With a goal of achieving 8% GDP growth by 2025 and double-digit growth subsequently, the private sector’s role is vital.
Tu Tien Phat, CEO of ACB Bank, pointed out that businesses have faced four long-standing concerns: costs, procedures, access to markets, and transitioning to green practices. While Resolution 68 presents promising policies, the challenge remains in actualizing these policies.
Phan Duc Hieu emphasized that reforming institutions stands as the most crucial, effective, fair, and cost-efficient approach. “Institutional reform is a focal point within Resolution 68. Prioritizing robust institutional reform will yield significant benefits. Results will follow once institutions are established,” he stated.
Looking ahead, he proposed the establishment of an independent Institutional Reform Agency under the Prime Minister, tasked with proposing new legislation and overseeing its implementation.
For instance, in South Korea, all proposals are reviewed by the Ministry of Justice before becoming formal drafts, and drafts of inferior quality are sent back for improvement.
Thuy noted that resolutions have never been acted upon as promptly as they are now.
“Over the last two months, our team has been working diligently, almost around the clock. The National Assembly has outlined nine groups of solutions, with clear directives for immediate application. The action program includes around 50 tasks, most of which are expected to be completed by 2025,” Thuy elaborated.
She added that while the resolution envisions progress by 2045, its immediate tasks focus on the next two years to ensure that institutions lead the way. Between 2026 and 2030, the emphasis will shift to unlocking and utilizing private resources to attain 8-10% growth. Any delay in institutional reforms until 2029 would impede these ambitions.
“A Government resolution is anticipated to be released in May, potentially as soon as next week,” Thuy concluded.
