A view of the Tan Son Nhat-Binh Loi Road in HCM City. The city has greatly contributed to the country's economic reform. — VNA/VNS Photo Hoang Hai

HCM CITY (Biz Hub)— HCM City has greatly contributed to the country's economic reform of the last three decades, a conference heard in HCM City on Monday.

Speaking at the conference – held to review the city's achievements during the 30 years of economic reform – head of Party Central Committee's Commission for Popularisation and Education Dinh The Huynh said HCM City has a great deal of experience in economic reform to share with other localities.

Le Thanh Hai, the city Party Committee Secretary, said a range of economic sectors play vital roles in the city's socio-economic development.

The city has recorded double-digit economic growth for nearly 20 years now, and its annual income per capita has reached US$5,000, he said.

The public sector plays a central role, he said, but added that it should only "facilitate the market instead of playing the role of the market."

Than Thi Thu, head of the HCM City Party Committee's Commission for Popularisation and Education, said the city has achieved many breakthroughs while overcoming challenges in the last 30 years.

It has created a legal framework for many business models, she said.

In 1989 the city issued a decision regulating many models of private businesses, limited companies, and joint-stock companies to create favourable conditions for the private sector's development, she said.

After the establishment of limited companies and joint-stock companies, the country's first export processing zones and industrial parks as well as the stock exchange were established in HCM City.

The city also developed programmes such as those to exchange land for infrastructure, socialise infrastructure, and improve the administration to serve the public better, which many other localities learnt from and followed suit, she said.

It not only taught the entire country lessons in socio-economic development but also ushered in the concept of urban management under the market mechanism, she said.

Challenges

HCM City has faced a lot of challenges during the process of economic reform like lack of economic competitiveness, infrastructure that could not keep up with economic growth and the demand for improvement in people's welfare, and the widening gap between the rich and the poor, Thu said.

The country and city are now facing many other hardships in the process of globalisation.

Other challenges include the ineffectiveness of public spending that has plagued the city for a long time, the worsening budget deficit, and transfer price abuse for tax evasion by foreign firms, which has become harder to check.

Half of foreign businesses in HCM City declare losses, Thu said. Many have reported losses for many years running, but continue to thrive, she said, adding that this creates unfair competition for local firms.

Other speakers referred to a major problem: the failure of the country, especially the city, to take full advantage of available resources.

The country is divided into three key economic zones in three distinct, but they lack linkages or co-operation, and fail to tap their potential.

Hai said the city needs to take more drastic measures to improve the socialist-oriented market economy.

Huynh said democracy is another issue that many delegates discussed at the meeting.

Many suggested that the democratic mechanism should be discussed more seriously at other forums.

Huynh called on the attendees to mull over the issues and send their opinions to the Central Theoretical Council. — VNS