The Power of Money: When Access Doesn’t Equal Freedom

A Significant Number of Businesses are Exiting the Market

On the morning of June 19th, the National Assembly proceeded with the first group of questions in the field of finance.

As the first questioner, Deputy Dang Bich Ngoc from Hoa Binh province pointed out that amidst global and domestic economic challenges, there is a growing number of businesses exiting the market. This is coupled with the fact that businesses are facing numerous difficulties in their production and operations, further intensifying the pressure to achieve the target of having 2 million operating enterprises in the economy by 2030, as outlined in Resolution 68.

She directed her question to the Minister: “As the head of the sector, what solutions do you propose to realize the goal of developing enterprises in terms of both quantity and quality in the next phase?”

In response to the question, Minister of Finance Nguyen Van Thang acknowledged that the target of reaching 2 million enterprises by 2030, as set forth in Resolution 68 of the Politburo, holds great significance for socio-economic development and reflects the economy’s strong aspiration for growth.

Nonetheless, he conceded that it also presents a formidable challenge, particularly given the decline in demand, the myriad difficulties encountered in the domestic business environment, and the competitive disadvantages faced by many Vietnamese enterprises.

“We have witnessed an alarmingly large number of businesses exiting the market in the first five months of this year. This is a significant challenge for us,” Mr. Thang shared.

To address this situation, the Minister proposed three groups of solutions. Firstly, he emphasized the importance of creating a conducive, transparent, and efficient business environment, focusing on removing barriers and reducing administrative procedures and compliance costs.

Simultaneously, it is crucial to resolve obstacles related to land access, construction, and planning, thereby providing businesses with a more transparent and stable framework to operate within.

“In line with current trends, we must also accelerate digital transformation in management to facilitate businesses as much as possible,” he added.

Furthermore, there is a need to vigorously promote the transition of household businesses to enterprises. Currently, there are over 5 million household businesses in operation, representing a substantial potential to materialize the goal of 2 million enterprises.

“We are also reviewing the legal framework to narrow the gap between household businesses and enterprises in terms of financial management and accounting practices. We aim to implement the planned abolition of lump-sum tax payments from 2026, thus fostering greater transparency and professionalism,” Mr. Thang explained.

Evaluating Officials Based on Public Investment Disbursement Results

Deputy Tran Kim Yen from Ho Chi Minh City raised a question regarding the ambitious target of achieving an economic growth rate of at least 8% by 2025. She acknowledged that this goal presents a significant challenge and requires both determination and innovative thinking.

Ms. Yen noted that one of the solutions proposed by the Ministry of Finance is to unlock and efficiently utilize public investment capital, striving for a 100% disbursement rate. However, despite significant efforts, the disbursement rate of public investment capital has remained low.

“People are still complaining that there is money, but it is not being used effectively. I would like the Minister to suggest more feasible solutions to contribute to achieving the growth target of 8% and above,” she said.

Responding to the question, Minister Nguyen Van Thang acknowledged that achieving a 100% disbursement rate of public investment capital this year is indeed a significant challenge.

He attributed the low disbursement rates at the beginning of the year to various factors, including a multi-stage process, bottlenecks in certain stages, shortages of raw materials, and inadequate implementation capacity in some localities.

Nonetheless, the Minister assured that the disbursement pace has picked up significantly in the last five months, reaching nearly VND 200 trillion, equivalent to 24.1% of the plan. This figure is higher than the same period last year (22%), and all national key projects have met or exceeded their targets.

To address this issue, Mr. Thang stated that the Government will focus on removing legal obstacles in public investment implementation and amending the Law on Public Investment to increase decentralization and empower localities to resolve project-related issues.

Additionally, the Minister emphasized that public investment disbursement results will be a crucial factor in evaluating the performance and completion of tasks by officials.