"Creating space" for businesses to innovate and keep up with new trends

Overview of the "Business development forum: Overcoming difficulties, creating new development space for businesses".

Seeking new growth "Space"

An overview of the economic landscape in the first six months of 2023 at the "Business development forum: Overcoming difficulties, creating new development space for businesses," organized by the Business Forum Magazine under the guidance of VCCI on July 19, 2023, Hoang Quang Phong, Vice Chairman of the VCCI, stated that the economy was facing numerous challenges, and the export market was declining, leading to the expectation that the production and business situation of enterprises would continue to encounter difficulties in the coming time.

"This sets the demand for Vietnamese businesses to innovate to keep up with new trends; otherwise, they will lose competitiveness and miss the opportunity to integrate deeply into the global value chain," emphasized the Vice Chairman of the VCCI.

In reality, despite the difficulties, many businesses have found "new growth spaces" by capitalizing on the advantages of free trade agreements, the rapid development of the fourth industrial revolution, and the strong global trend towards green growth.

Therefore, Phong suggested that to continue facilitating the recovery and development process of businesses in the last months of 2023 and the following years, the VCCI proposes focusing on improving the legal framework for business investment. Along with that, there should be continued measures to reduce costs for businesses and enhance their access to resources from government support packages.

The Vice Chairman of the VCCI emphasized the need to build and improve a legal framework that creates favorable conditions for the establishment and development of business models based on innovation and creativity. Particularly, it is crucial to promote programs that improve the business environment and enhance national competitiveness.

However, according to Phong, only businesses themselves know what they need the most. Therefore, the business community must identify challenges and opportunities and then discuss solutions to help businesses succeed sustainably.

Also at the forum, Nguyen Hong Long, Deputy Head of the Steering Committee for Innovation and Business Development, mentioned that many financial and credit policies have been issued to continue providing maximum support to businesses. Moreover, Government agencies consider removing barriers and difficulties for businesses as a top political task.

However, according to Long, the success of these efforts depends greatly on businesses and business associations. In the process of implementing policy mechanisms, businesses themselves need to provide direct recommendations on the practical issues that need to be resolved.

The motivation for institutional reform

Speaking about institutional reform and the business environment, Phan Duc Hieu, a Standing Member of the National Assembly's Economic Committee, pointed out that institutional reform was of significant importance, even more so than fiscal and monetary policies in the short term. It is not just about simplifying administrative procedures, but also about cutting the investment costs arising from legal regulations.

He also mentioned that the Prime Minister has recently issued Directive 644 on the adjustment, enhancement of responsibility, and effectiveness of administrative procedure reform, promptly resolving difficulties and obstacles for people and businesses. In which, three key points are emphasized in this directive: not only reforming procedures but also reducing compliance costs; reviewing and eliminating administrative procedures as barriers and reducing 20% of compliance costs; and resolving all feedback from people and businesses.

To effectively implement the Prime Minister's Directive 644, and achieve efficient and sustainable institutional reform, Hieu suggested focusing on controlling new regulations that increase costs. If not urgently needed, do not issue new regulations. If new regulations are necessary, there should be an appropriate timeline for implementation to allow businesses enough time to stabilize and prepare for compliance.

Hieu emphasized that in difficult times, businesses in certain sectors such as real estate and finance had a need to restructure their business operations. However, current regulations sometimes hinder these activities. Therefore, it is necessary to study and consider mechanisms for temporary and targeted relaxation to assist businesses in implementing restructuring and overcoming difficulties.

Representing the wood industry, Ngo Sy Hoai, Vice Chairman and Secretary-General of the Vietnam Timber and Forest Product Association (VIFOREST), stated that export-oriented enterprises desired a reduction of foreign currency borrowing rates to 3.8% per annum to support them in overcoming challenges and increasing competitiveness.

Besides support from regulatory authorities, businesses are encouraged to restructure their production and innovate their business models towards modern management and digitization. According to experts, the green trend is also an opportunity for businesses to participate and fully grasp the potential to enter the European market and other potential export markets.