The Vietnam Business Forum interviewed with Mr Hoang Van Dung, Vice Chairman of Vietnam Chamber of Commerce and Industry (VCCI), on the opportunities and challenges Vietnamese companies have encountered in the year since WTO accession.
The first year of WTO membership was the time for us to see the maturity of Vietnamese enterprises. How do you assess the performance of Vietnamese enterprises, especially small and medium enterprises, during this time?
In the year since joining the WTO, Vietnamese companies have quickly grown and integrated into the region. This is proven by the strong export and foreign investment attraction. According to statistics, in the first 10 months this year Vietnam attracted US$13 billion, up 30 per cent on year. This is actually a great leap. Especially, the awareness of Vietnamese companies, particularly small and medium enterprises (SMEs), has been promoted. Arguably, Vietnamese enterprises have secured a strong foothold in the country and began integrating into the region and the world.
Vietnam has carried out programmes to raise understanding of the opportunities and challenges the WTO brings for enterprises. VCCI has carried out the IT application programme for them, especially SMEs, to provide them with easier access to information and with quicker integration.
However, Vietnamese companies encountered certain difficulties such as in administrative procedures and human resources - both managerial and skilled employees. In the past year, many major projects need skilled workers, but the country failed to meet this demand.
In infrastructure, Vietnam has long been forecast to face shortages of electricity and cannot ensure sufficient supply in the coming years. In the context of soaring world oil prices, Vietnamese faced great difficulty in cutting production costs. Other infrastructure items such as poor seaports and communication and traffic systems also affect the production and circulation of goods, increasing production costs for enterprises.
Labour sanitation and safety problems, as well as strikes, are at alarming levels. According to the Ministry of Labour, War Invalids and Social Affairs, from January 1, 2007 to November 5, 2007, there were 458 strikes, up from only 390 in 2006. Of the sum, the foreign-invested sector had 358 cases, 99 cases were in private companies and one in the state sector. The relationship between employers and employees foundered when high inflation impacted the life of labourers. Drastic measures are vital to avoid further strikes to create a favourable environment for enterprises.
How should Vietnam encourage private enterprises to invest more?
On the macro level, policies are necessary to encourage private companies to invest in the fields we want to develop. Tax, import-export incentives, IT and scientific incentive policies should be introduced to encourage companies to apply technology to improve productivity and reduce prices. Especially, apart from streamlining administrative procedures, the government should improve the infrastructure, especially electricity, roads, seaports and airports.
The APEC Business Travel Card has been implemented for more than a year. Is the number of Vietnamese businesspeople obtaining this card increasing?
The programme has been carried out in all provinces and cities. Businesspeople in major provinces and cities have been granted APEC Business Travel Cards. With the cards, businesspeople can easily travel to the 17 APEC economies. Only four countries have not joined the APEC Business Travel programme, including the US, Canada, Mexico and Russia. However, the number of the cards granted to Vietnamese people remains small and the programme needs to be ramped up in the coming time.
In 2006, VCCI made great effort to help enterprises integrate into the region and the world. Would you mind revealing what VCCI will do to help businesses in the coming time?VCCI took part in the post-WTO project with the purpose of explaining the advantages, difficulties and challenges when Vietnam joined the WTO. VCCI will send business delegations to importers of Vietnamese goods and organize the ASEAN 100 Meeting for chief executives of regional countries. VCCI will also polish the image of Vietnam in other countries via international seminars, conferences and meetings to attract foreign capital into Vietnam. VCCI will also carry out activities for sustained development, labour relationship improvement and IT applications. To date, VCCI signed many cooperation agreements with provinces and cities and hosted some 200 training courses on IT applications to help local authorities and businesses build websites, giving them another channel to advertise their products and services to foreign customers.
In the coming time, VCCI also will step up activities introducing Vietnamese businesses at international forums, organizing courses to teach the technologies foreign companies bring to Vietnam, and hosting seminars and conferences on calling foreign investment capital into Vietnam. At the same time, VCCI will continue advising the Government to introduce policies to improve the business and investment environment. Especially, VCCI will request that the government streamline administrative procedures and seek measures creating capital sources and advantages in land and production sites for enterprises. It will also encourage domestic and foreign companies to contribute their ideas about the economic policies and strategies of the Vietnamese Government.
Lan Anh
Vietnamese
