Vietnam jumps 10 spots in global competitiveness index
Vietnam jumps 10 spots in global competitiveness index
Vietnam rose to the 67th from the 77th spot on the global competitiveness index, with a rise of 3.5 points compared with last year, heard attendees at a seminar in HCMC on October 24.
However, despite ministries and departments eliminating multiple business requirements to assist enterprises for the past few months, the move has still failed to substantially simplify administrative processes.
Speaking at the seminar on Vietnam’s competitiveness and challenges for enterprises, Nguyen Minh Thao, head of the Business Environment and Competitiveness Department at the Central Institute for Economic Management, noted that business requirements remained challenging for local firms.
Despite the removal of a number of requirements by ministries and departments, postcustoms clearance inspections have been tightened, partly affecting enterprises’ operations, Thao remarked.
Referencing the Ministry of Industry and Trade’s Decision 765 on the list of commodities eligible for reduced specialized inspections, under the management of the ministry, she explained that hundreds of steel products and textiles were on the list.
The decision stipulates these products should not face inspections in the precustoms clearance process but should undergo postcustoms clearance inspections, Thao said.
Besides this, procedures for approval across many levels and agencies have also hindered firms’ development. In the past, the Ministry of Labor, Invalids and Social Affairs was in charge of issuing or revoking licenses for labor safety, but enterprises currently have to apply for the licenses to nine ministries.
In addition, Thao also pointed out that the adoption of some regulations remains questionable. For example, Decree 15/2018 allows some food products to avoid specialized inspections on food safety. However, these products still undergo food safety inspections when being processed through the subdepartment of customs.
Addressing the seminar, lawyer Nguyen Quoc Phong at Aliat Legal pinpointed some bottlenecks related to the Investment Law and the Enterprise Law. He stated that foreign firms that wish to raise their investment in a firm in Vietnam are required to redo procedures for capital contribution.
Another example is that foreign investors, when entering the logistics sector, are allowed to add a restricted amount of capital to their projects under existing regulations, Phong remarked. However, when they apply to the authorities of localities for investment licenses, these authorities send the applications to the ministries for approval, wasting time in the process.
At the seminar, many firms also complained that the requirement of certificates of free sale for imported cosmetic products has been causing difficulties. It takes some two to three months to apply for the certificates and conduct the relevant procedures, slowing down firms’ business activities.
A representative of Johnson & Johnson proposed removing the requirement to create favorable conditions for enterprises.
