National Assembly concludes busy second session

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The legislature considered and ratified three laws and 11 resolutions, while giving the first readings to 12 laws. These documents will help to improve Vietnam’s legal framework.

Notably, the National Assembly has for the first time discussed the Law on Planning, compiled by the Ministry of Planning and Investment (MPI), stressing the need for this law to help the government direct socioeconomic activities more effectively.

It is expected that the law will be ratified by the National Assembly in June 2017.

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Vietnam has more than 19,000 planning projects whose shortcomings at the central or grassroots levels have wasted national resources and hampered investment attraction, according to MPI.

The law on planning combines existing ordinances into a system of planning. It overrides the current haphazard and ineffective circulars and decrees issued by ministries, sectors, and provinces. It is considered a tool to settle conflicts between sectors, or provinces toward more sustainable development.

In addition, during the session, an MPI-compiled resolution on an economic restructuring plan for the 2016-2020 period was also passed. The plan highlights the importance of restructuring state-owned enterprises (SOEs), public investment, and the banking sector.

The resolution noted that Vietnam currently faces big challenges in the banking sector and efforts need to be made to “deal with and remove cross-investment and cross-ownership among credit organisations, and boost the divestment of capital at commercial banks.”

According to the World Bank, with elevated non-performing loans (NPL) ratios and balance sheet positions intertwined with the SOE sector, the banking sector remains susceptible to sudden shifts in depositor confidence and unexpected news on SOE performance or asset price movements.

The country’s NPL ratio, as at the end of September, was recorded at 2.62 per cent, exclusive of the amount of NLP sold to Vietnam Asset Management Company (VAMC) – a state-owned firm in charge of solving NPLs.

The bad debt ratio, as such, may well add up to 7 per cent of the total outstanding debts, consisting of the recently announced NPL and the NPL sold to VAMC that have not been collected, according to BIDV acting deputy general director Can Van Luc.

However, though having assumed a growing share of bad assets worth about $9 billion, VAMC is yet to develop a clear strategy to resolve them. Progress is partially hampered by gaps in the existing State Bank regulations and the corporate restructuring framework.

Also at the session, the National Assembly has also adopted Vietnam’s socioeconomic development plan for 2017, which set many macroeconomic targets, including a GDP growth rate of 6.7 per cent (increased from the expected 6.3-6.5 per cent this year) and a rise of 4 per cent in the consumer price index.

In addition, the National Assembly also reviewed reports from the Chief Justice of the Supreme People’s Court, the chief prosecutor, and the government on the enforcement of laws on preventing and combating crime, anit-corruption policies, and law enforcement. Furthermore, the legislature also reviewed the report of the Vietnam Fatherland Front on voters’ opinions and petitions.

The National Assembly also reviewed reports on the implementation of the national target programme on developing new rural areas, coupled with restructuring the agricultural sector for 2010-2015.

Bills and resolutions are adopted:

- Law on faiths and religions

- Law on property auctions

- Law on amending Article 6 and Annex 4 (List of conditional business activities) of the Law on Investment.

- Resolution on pilot issuance of electronic visas for foreigners travelling to Vietnam

- Resolution on the socioeconomic development plan for 2017

- Resolution on 2017 national budget estimate

- Resolution on 2017 central budget allocation

- Resolution on five-year financial planning

- Resolution on mid-term public investment for 2016-2020

- Resolution on economic re-structuring plan for 2016-2020

- Resolution on amendment of some articles of Resolution 55/2010/QH12 on reduction and exemption of agricultural tax

- Resolution on the continued improvement of the effectiveness of the national target programme on new rural development and agricultural sector restructuring

- Resolution on question time in the second session of the 14th National Assembly

- Resolution on termination of Ninh Thuan nuclear power project investment plan

Bills given the first readings:

- Law on railways (amended)

- Law on foreign trade management

- Law on management and using of firearms, explosive equipment and supporting tools

- Law on supporting small and medium-sized enterprises

- Law on management and using of state properties (amended)

- Law on irrigation

- Law on technology transfer (amended)

- Law on compensation responsibility of the state (amended)

- Law on guardianship

- Law on tourism (amended)

- Law on legal assistance (amended)

- Law on planning