Hanoi (VNS/VNA) - Barriers in the business environment must be removed topromote the development of private enterprises, which is considered a push forpost-pandemic economic growth, experts said.

Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry, said thatVietnamese firms were undergoing a crisis caused by the COVID-19 pandemic.

“It’s time to speed up reforms and create a favourable business environment forthe private sector,” Loc said, adding that the focus would be on strengtheninginstitutional reforms, simplifying administrative procedures and improving theinvestment climate.

The pandemic was spurring a wave of investment shift with signals that Vietnam wouldhave significant opportunities to become a global production centre. However,the opportunities would come and go quickly if Vietnamese enterprises did notimprove their competitiveness drastically to participate in global valuechains, Loc said.

Improving competitiveness of Vietnamese enterprises, especially those of smalland medium size, to enable them to be capable of becoming partners ofmultinational corporations was the decisive factor behind the success of theVietnamese economy, he stressed.

According to economic expert Ngo Tri Long, one obstacle was that most privatefirms (around 96 percent) were of small and medium scale. The private sectoralso had around five million business households, but the process oftransforming them into enterprises had not been efficient as expected.

Le Duy Binh, Director of Economica Vietnam, said that compliance costs, interms of time and money, remained high to enterprises as many business andinvestment procedures were too complicated.

Besides, unofficial charges were also a big problem, Binh said, citing therecent provincial competitiveness index survey’s finding that more than 50 percent must pay unofficial charges, a significant financial burden to anyenterprise.

In some localities, there was discrimination between private firms andState-owned and foreign-invested enterprises, in which private firms had morelimited access to resources and business opportunities, he said.

The Government was striving to achieve an economic growth rate of more thanfive per cent this year – a challenging goal.

While the workload for disbursing public investment remained huge in theremaining months of this year, increasing private investment was consideredanother push to post-pandemic economic growth.

Binh said that barriers in the business climate must be removed to promoteprivate investment for post-pandemic recovery.

“It is critical to improve the business environment to cut costs for enterprises,”he said, adding that officials who intended to cause difficulties to businessesmust be strictly punished. Firms’ confidence in the business environment mustbe improved so that they would be willing to pour investment into the economy.

The private sector, including business households, contributed around 40 percentto the country’s gross domestic product.

Vietnam targeted to have at least one million enterprises by the end of thisyear which would contribute 50 percent of GDP and at least two million by 2030which would contribute 60-65 percent of GDP./.