Private Sector in Vietnam Yet to Achieve a Breakthrough

The private sector in Vietnam is yet to achieve a breakthrough due to lack of capital or cumbersome administrative procedures. This was highlighted at the Vietnam Economic Cooperation which was attended by more than 300 local and foreign businesses.

Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry, said the private sector receives the least priority. He attributed this to policies prioritizing State-owned and foreign firms over it. "It is time to include household and individual businesses and foreign-owned companies in which case the private sector accounts for 61 per cent of GDP." Vietnam has more than 700,000 private companies of which 96 per cent are small and medium-sized enterprises and 2 per cent each are super-small and large enterprises.

Loc pointed out that even for developed countries like the US, Japan and Europe, small and micro enterprises are the backbone, and Vietnam is no exception. He said institutional reform is needed to safeguard companies' rights and ensure the consistency of the system.