PCI 2022: Bac Giang improves significantly as two biggest cities drop

PCI 2022

On the morning of April 11, the Vietnam Chamber of Commerce and Industry (VCCI) launched its 2022 PCI. The annual report is the result of a long-standing collaborative effort between the VCCI and the US Agency for International Development (USAID) and is designed to assess provincial economic governance, the ease of doing business, and administrative reform efforts, all in the hope of boosting private sector development.

The 2022 PCI report was developed from the responses of nearly 11,900 businesses, including 10,590 domestic private businesses and around 1,280 foreign-invested enterprises operating in Vietnam. In total, a stunning 176,496 different businesses have participated since the beginning of the PCI survey in 2005, reflecting the various facets of the Vietnamese business environment.

Quang Ninh, Bac Giang, Haiphong, Ba Ria-Vung Tau, and Dong Thap secured the top 5 positions in the PCI 2022 rankings. The report reveals the tremendous efforts of both businesses and provincial governments to navigate through the recent rough waters. Both domestic and foreign firms reported improvements in administrative procedures, reductions in the time required for bureaucratic compliance, and liberation from the burden of informal charges.

However, the effects of the challenging economic environment are also clear in this year’s report, as reforms in many policy areas slowed and business optimism remained low. Many firms report multiple hurdles with access to finance, hiring, infrastructure growth, and a gap between central policy and its implementation on the ground.

Pham Tan Cong, chairman of the VCCI stated, “Businesses in Vietnam are facing multiple obstacles from the current economic situation. We hope that both provincial and municipal governments will further strengthen their business support policies and contribute to a more enabling and stable domestic business environment to make up for the global instabilities.”

In this year’s report, the VCCI also launched the PGI, an initiative it developed with support from USAID and private sector partners. This index evaluates and ranks provinces’ environmental policies from the perspective of businesses with the goal of improving business behaviour and practices, including the application of new green technologies. Tra Vinh, Lang Son, and Bac Ninh were the top 3 PGI performers in this inaugural edition.

Aler Grubbs, USAID's Vietnam mission director said, “For nearly two decades, the VCCI’s successful PCI has prompted stimulating discussions and effective action on critical business issues. The new PGI builds on this prior success, and it signals a greater recognition among the private sector that environmental considerations are equally important for business success and long-term economic growth.”

With the introduction of the PGI, it is hoped that provinces and cities in Vietnam will pay greater attention to environmentally responsive economic development, provide up-to-date information that informs investment and environmental policy, and ultimately promote an environmentally friendly business ecosystem that contributes to the country’s green growth orientation.

This year's report was fortuitously released on the eve of the 60^th anniversary of the founding of the VCCI (1963-2023) and the 10^th Anniversary of the Vietnam-US comprehensive partnership (2013-2023).

Provincial trio topping PCI rankings Despite the remarkable improvement of Vietnam’s cities and provinces to enhance competitiveness, many issues are remaining for them to lure in more investment.

Hai Duong makes a PCI breakthrough Within just a year, the northern province of Hai Duong moved up 34 notches in the provincial competitiveness index to 13th position, surpassing the target set for 2025 – and demonstrating its efforts to improve the local business environment.