Business forum calls time for reforms

The year-end VBF is to take place at a time when macro-economic stability has been achieved but fatal issues of declining domestic consumer purchasing power and bad debts continue to plague domestic businesses. Will these elements influence sentiments at the VBF, in your view?

You’re right to say that the macro-economic results are good, it was necessary, but very much at the expense of businesses and the domestic economy, which has almost been in recession for two years.

The overall business sentiment is very similar to last June. This is why we have kept the same theme. We didn’t expect the crisis to be resolved in a few months. Since June, the restructuring of the banking sector has started with the setting up of VAMC but this is only a first step and much more should be done in the banking and state-owned enterprise (SOE) sectors.

What will make the forum, which is themed ‘New phase of economic reform, from agenda to action’, different from its predecessors?

As the key driver of the forum’s development, we have consistently innovated by introducing fresh initiatives. This year-end VBF will address structural economic changes with SOE reforms the core pillar for the forum’s discussions. Delegates will approach this issue from different angles, on behalf of chambers of commerce, business associations and working groups. This multi-layered approach will inject more substance into our defining, year-end forum.

Another innovative feature of the forum will be presentations. For the first time we will comprehensively cover pressing issues related to customs, governance and business transparency. We will also introduce a new dialogue flow where all technical points in respective sectors will be discussed in detail, followed by an all encompassing discussion to wrap up the technical sessions at a more macro level, from a governance and transparency perspective.

In addition, to mark the looming two-year milestone since IFC transferred the VBF co-ordination function to the VBF Consortium in 2012, a progress report will be tabled at this forum underlining how a number of working issues identified by the VBF since early 2012 have been addressed to the satisfaction of our members and the business community in general. We will also take this opportunity to paint a general picture of the VBF’s impressive development since its transition.

The VBF is an important opportunity for dialogue between the government and private sector

SOE issues have not traditionally been a focus of the VBF? Why will this change?

Putting SOEs on top of the agenda is a dramatic change. As I mentioned earlier, the issue of SOE reform has been selected as the central subject for discussion by most VBF speakers with a myriad of SOE reform aspects explored. From an accurate overview of SOE reforms in the current challenging economic situation, we will explore how reforms have been implemented and identify obstacles impeding process. More importantly, VBF members will make proposals on how to mitigate these problems and take full advantage of new opportunities in international integration to boost the progress of SOE reform. Insights from international experience and practices on how to fuel the SOE reform engine will be included in discussions.

What new concerns will be raised by foreign investors at this forum, apart from long-lasting problems that have been discussed repeatedly at previous VBF events like corruption, bureaucracy or poor infrastructure?

The theme of the forum speaks for itself, it is clearly time for action as the macroeconomic situation has stabilised

The government has no choice and needs to boost confidence in the business sector. It is not the time for a financial stimulus plan as inflation should remain very much under control; it is time for accelerating key structural reforms.

Beside the SOEs there should be restructuring and re-capitalisation of the banking system, the implementation of enlarged foreign participation in shareholding of listed companies which was proposed by VBF some months ago, action in some economic sectors to follow ASEAN economic integration, such as the car industry, to promote productivity and increase local added value.

The time is right for better corporate governance. In previous forums corruption was mentioned, but this time the private sector is proposing concrete actions in line with the Anti-Corruption Dialogue.

We also want to follow up previously discussed issues as they remain important.  Last but not least, there will be discussions over the Trans-Pacific Partnership (TPP) and EU free trade agreement (FTA), as well as other FTAs to stimulate growth in key sectors, and this will be addressed to encourage the government to  conclude negotiations as soon as possible.

It has been nearly two years since the VBF consortium of local and international business associations and chambers of commerce took over the VBF co-ordinating role from IFC. Do you think the private sector’s bigger role and involvement in the VBF has delivered results?

I think the VBF progress report for the time since its transition will demonstrate the practical effectiveness of the private sector’s direct involvement in the forum. The big advantage of the new VBF is the stronger involvement of Vietnamese businesses and also Japanese and Korean businesses which are important investors in Vietnam. This makes the VBF more credible and powerful. We welcome the addition of new members.

The business community understands the value and ability of the VBF to deliver highly effective results and the business chambers and associations have created momentum for the VBF’s accelerated development. Since the transition we have created a new online interface and an identity.  Moreover, we have explored new sectors by establishing four new working groups encompassing car manufacturing, customs, governance and transparency and most recently agricultural sectors.

The ten working groups are the key drivers of the forum and have more regular technical consultation meetings with their respective government counterparts. The groups are delivering high quality work and results across diversified subjects with new reinvigorated approaches.

By joining hands with local and multi-national businesses, we believe in co-operation and a strengthened voice to enhance the efficiency of the forum and help create a sustainable investment climate development that benefits the business community and Vietnam’s development goals.