Vietnam Today

Under the Socio-Economic Development Plan in the 2021-2025 Period, presented to the National Assembly by the Government on July 22, Vietnam aims to become a country with modern industry, effectively overcome the impact of the Covid-19 pandemic, and quickly recover and develop its economy. The plan sets out 23 key indicators, including eight economic indicators, nine social indicators, six environmental indicators, and 12 groups of tasks and solutions.

According to a summary of audit results in 2020, although the 17 audited State-owned enterprises (SOEs) are profitable, the management and use of capital and assets exhibit violations and are not in accordance with State regulations. Management and debt collection remain quite weak at many. A number of real estate investment enterprises are yet to sell products from completed projects, which reduces the efficiency of capital use.

A project to develop the tourism industry in central Thua Thien-Hue province into a spearhead economic sector has been recently approved by the provincial People’s Committee. The industry is to attract some 6 million visitors by 2025 and currently contributes about 14 per cent of provincial gross regional domestic product (GRDP). It employs 80,000 workers, or 13 per cent of the province’s workforce, and this is to rise to 100,000 and 15 per cent by 2030.

The National Assembly Economic Committee has proposed a number of measures to help businesses cope with Covid-19, including promoting the role of support funds and credit guarantees for small and medium-sized enterprises (SMEs), improving the capacity of collective economic sectors and cooperatives, continuing to reduce input costs for businesses, and implementing tax laws more thoroughly.

Vietnam’s auto imports have been substantially influenced by the ASEAN Trade in Goods Agreement (ATIGA). Since import taxes on completely built-up (CBU) vehicles were cut to zero from January 1, 2018 under the agreement, vehicles from Southeast Asia have continuously grown in terms of market share. In the first half of this year, Vietnam imported 79,353 CBU vehicles worth $1.73 billion. Those originating from Southeast Asian countries (mainly Thailand and Indonesia) dominated in terms of volume, accounting for 80 per cent.

As the restructuring of State-owned enterprises (SOEs) is one of the priorities of the government, the Prime Minister has issued Decision No. 22/2021/QD-TTg, which stimulates the speed of SOE restructuring by promulgating classification criteria and emphasizing decentralization. It is expected that some 1,500 SOEs will be restructured to 2025. Vietnam should take note of China’s approach to such restructuring, towards “grasping the large, letting go of the small”. The reason for this is the similarities in governance, with Vietnam’s Commission for the Management of State Capital at Enterprises (CMSC) and State Capital Investment Corporation (SCIC) being similar to China’s State-owned Assets Supervision and Administration Commission (SASAC). SOE restructuring in China has been quite successful in recent times thanks to the application of core strategies, including the merging of large enterprises into corporations.