The private sector, including FDI (foreign direct investment) firms, plays a crucial role in national development, Prime Minister Nguyen Xuan Phuc said on Monday.

Addressing the 2016 Vietnam Business Forum held in Ha Noi, he also said the Government accords equal importance to all sectors and businesses.

“In order for the Vietnamese economy to advance and develop, the private sector must have a strong growth potential as well.

“The Government holds all businesses, domestic and foreign, in equal regard. And in the foreseeable future, policies and regulations will continue to be updated and re-issued in accordance with international law and markets," Phuc said at the annual forum.

The PM welcomed this year’s focus on the role that the private sector has played in economic development over the last 30 years after the nation embarked on its market-oriented renovation policy.

Ryu Hang Ha, Joint Chairman of the Vietnam Business Forum’s Management Board, stressed the need for domestic businesses to improve their relationship with FDI companies based in Viet Nam through a common information network. He said this would boost domestic businesses’ inner strengths and drive the economy forward.

In response, Phuc said he hoped that FDI companies, which enjoy technological, financial, marketing and managerial advantages, will commit themselves to concrete actions in working with domestic businesses, helping the grow on the basis of mutual benefit.

The PM urged businesses to propose initiatives and policy suggestions, as well as investment projects according to the environmentally friendly sustainable development goals set by the Government.

PM Nguyen Xuan Phuc speaks at the forum on Monday. -- Photo VNA

He mentioned many significant achievements by FDI companies as well as domestic small and medium enterprises.

A total of 21,000 foreign firms were operating in Viet Nam with nearly US$300 billion in capital, he noted, adding that this illustrated the importance and potential of this economic sector as a large revenue generator for Vietnamese economy.

However, he also warned that Viet Nam will not welcome investors using the country as a tax haven to launder money, avoid environmental responsibilities, and act against the basic principles and core values of entrepreneurship. Such actions would harm national interests and undermine the goal of sustainable development, not to mention deter other potential foreign investors, he said

Vu Tien Loc, Chairman and President of the Vietnam Chamber of Commerce and Industry and Co-Chairman of the 2016 Vietnam Business Forum, said many current economic policies were not comprehensive enough, inspection processes were slow and overlapping, and administrative procedures continued to be ambiguous and cumbersome.

These caused any number of difficulties for businesses in accessing credit, land-use rights and created several tax and non-tax barriers, he said.

Virginia B. Foote, Chair of the American Chamber of Commerce in Vietnam, said administrative burdens can become a deadweight for human resource development and slow down private sector growth.

The PM urged the Vietnamese business community to actively participate in the economic reconstruction process, through diversification of investments, paying particular attention to public-private partnerships (PPP). This would encourage the entrepreneurial spirit, drive innovation, increase competitiveness and product quality, he said.

He said that the Vietnamese government would continue the task of completing a national legal framework for the market economy, and persist with administrative reforms to create a favourable investment and business environment.

The goal, he said, is to increase national competitiveness and facilitate private sector growth towards meeting the ASEAN4 standards set by the World Bank (WB) and World Economic Forum by 2020.

Phuc reiterated his interest in having FDI companies working together with the Government and other domestic businesses, promoting technology transfer, human resource training, sharing of managerial experiences and undertaking responsibility for social and environmental concerns.

He said the Government would also prioritise domestic supporting industries, specially in the small and medium scale sector, to gain access to manufacturing technologies.

He said they should work with FDI companies to bring Vietnamese products into regional and international distribution chains.

Other areas that the conference focused on included the upgrade of infrastructure and PPP frameworks, development of clean and renewable energy, climate change adaptation and environment protection.

It was noted that in recent years, Viet Nam had made significant progress in terms of business growth, with more than 600,000 registered enterprises and more than 3.5 million individual small businesses. In 2016 alone, more than 100,000 new businesses were registered. Many domestic companies like Vietnam Airlines, Vinamilk, TH True Milk, Saigon Tourist and Viet Jet have become well-known, internationally.

The 2016 Annual Vietnam Business Forum was organised by the International Finance Corporation and the WB Group in collaboration with Vietnamese Ministry of Planning and Investment.

Participants included high ranking officials, representatives from international economic organisations, trade offices, and representatives of the domestic and foreign business community in Viet Nam. —VNS