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VN urged to oil wheels of commerce
Viet Nam has made two regulatory reforms in the fields of tax payment and trade across borders over the past year, but more work needs to be done if the country is to have an easier business environment, a World Bank economist said yesterday, September 9, at a conference to release its yearly report, Doing Business 2010.
Opening the conference, World Bank Country Director in Viet Nam Victoria Kwakwa said the difference of Doing Business 2010 was that it was being conducted as global economies were dealing with the world financial crisis.
Assessing business regulations was of great importance, as this would show the competitiveness of economies and could affect how firms were able to cope with the crisis and seize opportunities when recovery began, she said.
According to the report entitled "Reforming through Difficult Times", Viet Nam was ranked 93 out of 183 economies in regards to its ease of doing business.
Last year, the country was ranked 91 of 181.
Sylvia Solf, the World Bank Programme Manager for the Doing Business Project, said that increasing competition in the logistics industry and the application of new customs procedures, as required when integrating into the World Trade Organisation, had helped companies reduce import and export times by two days from 24 days.
The report also recognised an improvement in tax payment regulations, as the country cut the corporate income tax rate from 28 per cent to 25 per cent, and eliminated the surtax on income from transfers of land. It also adopted a new enterprise income tax law and anew value-added tax law.
To create an easier business environment, Solf suggested that procedures for business start-ups be reduced. The current number of procedures that a new firm must complete was 11, while in New Zealand and Canada the figure was only one.
Besides, more reforms in protecting investors, such as more requirements for information disclosure and clearer regulations of investors' responsibilities, were also needed, she added.
Kwakwa said that Viet Nam should make full use of its advantages, such as its long coastline, abundant natural resources and large population to increase its competitiveness.
However, Viet Nam was one of the countries that had a positive growth rate amidst the global crisis, thus it had a relatively firm foundation to speed up its recovery. Therefore, Viet Nam should not overindulge in addressing short-term problems, but should focus on mid- and long-term policies, she said.
The Vietnamese Government's economic stimulus package was proven efficient, as it had helped the country avoid a deep recession, but the Government should reassess its policies to know where to focus on while improving the country's economy, she added.
She noted that infrastructure and administration reform were important factors for long-term improvement.
The report assessed the ease of doing business in Viet Nam based on 10 topics of business regulations: starting a business, dealing with construction permits, employing workers, registering property, getting credit, protecting investors, paying taxes, cross-border trade, enforcing contracts and closing a business during the period between June 2008 and May 2009.
According to the report, despite the global crisis, 131 of 183 countries worldwide made a record of 287 reforms, 20 per cent higher than the year before.
Notably, two-thirds of reforms were carried out in developing economies.
Singapore was the top-ranked economy on the ease of doing business for the fourth year in a row, followed by New Zealand. However, among 17 economies in the East Asia and Pacific region making reforms, Indonesia was the most active reformer, moving to 122 from 129.
VietNamNet, VietNamNews
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