Vietnam Business Forum (“VBF”) – Hanoi Plenary Meeting
18 Dec 2017
The meeting which was attended by Prime Minister Nguyen Xuan Phuc, MPI Minister Nguyen Chi Dung, Head of the World Bank In Vietnam, Head of the IFC in Vietnam, Dr Vu Tien Loc-President of the Vietnam Chamber of Commerce and Industry, other Ministers and deputy ministers and members fot eh various Business Chambers in Vietnam, marked the 20th anniversary of the VBF in Vietnam, a platform for dialogue between the Private sector and the Vietnamese Government supported by the World Bank, IFC and other Bi-lateral and multi-lateral donors.
In his Keynote address the Prime Minister highlighted the fact that in 1997, when the VBF (then the Private Sector Forum) first met Vietnam’s GDP was US$ 27 billion and this year it will be in excess of US$ 220 billion. He also confirmed the strong development of the economy with all 13 of the Government’s planned targets being achieved or surpassed. In particular he confirmed that Vietnam had met it’s GDP growth target of 6.7%, inflation remained under control and below 5%, the exchange rate remained stable. Export growth had exceeded the target and should reach almost USD 200 billion in 2017 and over 120,000 new private enterprises had been registered, bringing the total to more than 550,000.
Foreign direct investment reached a total of over US$ 35 billion a record in the last 20years, and implemented FDI reached a new record of US$ 17.5 billion. In the last 2 years Vietnam had also climbed 23 places in the World Bank’s Ease of Doing Business Guide.
One of the factors drawing increased investment is the rapid rise of the middle class expected to increase to 50% by 2035 from the current level of 10% (figure quoted by the Prime Minister). The Government plans to introduce regulatory changes to facilitate technology changes that are driving the Industrial Revolution 4.0.
The Government’s main focus going forward will be: priority development and investment in infrastructure; investment in education, macro-economic and political stability; focus on reforms of State Owned Enterprises, banking sector and non-performing loans, improving taxation and reducing the administrative burden on business. Other issues that would receive attention would be improving the institutional and legal framework, the rule of law and corporate governance, facilitating Vietnamese companies investing overseas and leaving to the private sector what the private sector can do.
Overall the continuing theme is that the Government wants to be seen as an enabling Government and much was said on the matter of reducing approvals and permits that are required for business, highlighting the fact that 2000 had already been removed by the present Government. The various minters and representatives of ministries welcomed the comments from the business groups and promised to address the issues raised.
After a couple of rocky times during the life of the VBF this is now well entrenched in the relationship between business and Government and held by the World Bank and IFC to be the most successful platform of its’ kind in the developing world.