Vietnam to Focus on the Private Sector

Ho Chi Minh City and Hanoi Government dedicated to creating positive environment for the private sector

In a recent interview for the Financial Times, Vietnam’s Prime Minister Nguyen Xuan Phuc talked about Vietnam’s current and future economic path.

According to the PM, in the next two years, Vietnam aims to create more than half of its economic output from the private sector (which currently stands at around 43%). This shows that the country’s leadership is determined to enable the private sector to become the main engine of the country’s economy.

“We will try to put in place the most favourable policies and create the most favourable environment so that by 2020 we will have in operation over 1 million businesses accounting for 50% of Vietnam’s GDP”.

In addition, the PM raised his hopes that the GDP growth of the previous year (6.7%, the fastest growth in the previous 10 years) will be exceeded in 2018, and stay at a similar level until 2020. The government plans to enable these results by creating economic conditions where private sector can thrive. “In order to attain this, we will try to maintain favourable conditions for businesses, healthy environment for businesses and further international integration, especially support for private sector and nurture innovation so that we can enhance GDP growth for many years to come.”

Since becoming a PM in 2016, Mr. Nguyen Xuan Phuc paid special focus on reducing the importance of state-owned enterprises on the economy. First results are already visible, such as recent sale of stakes in the country’s largest brewer, or the establishment of a committee that will oversee state-owned assets and speeding-up equitization.

BDG Insights

With the dedication and support coming from the government, CPTPP trade deal, strong manufacturing results and consistent competitiveness level, we can be optimistic that Vietnam’s economic performance in the years to come will be strong.

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