Ho Chi Minh City pledges to clean up business environment

By Ngoc Hau, An Hong   August 2, 2016 | 03:07 pm GMT+7

The city's top official is determined to eliminate under-the-table payments and allay investor concerns.

Ho Chi Minh City has recorded a 68.4 percent decline in foreign investments to $638 million in the first seven months of the year, statistics show.

The city’s authorities are obviously worried that the southern city might be losing its attractiveness in the eyes of foreign investors as a dynamic business hub in Southeast Asia.

Top city leaders, including Chairman of the People’s Committee Nguyen Thanh Phong, are aware of the realities of doing business in the city.

The city’s chairman frankly pointed out that unofficial payments to public officials are part of the picture that gives foreign investors an unfavorable opinion of the city’s business environment.

“Officials from each industry need to make the time to hold public meeting with businesses to hear directly from them, not from a go-between,” Phong said at a meeting on Monday.

The chairman said that businesses should not have to go through a middleman to set up a meeting with the city’s authorities.

He also pledged to cut through red tape and remove other cumbersome administrative hurdles to create a more favorable business environment in Ho Chi Minh City.

ho-chi-minh-city-pledges-to-clean-up-business-environment

The city’s economy has expanded an estimated 7.47 percent in the first half of 2016, and is set to grow by 8 percent this year, said Chairman of the People's Committee Nguyen Thanh Phong. Photo by Ngoc Hau.

Ho Chi Minh City is striving to become a smart and dynamic part of Asia and a talent hub where investors and start-ups flock together to thrive on a sustainable market-based economy.

The southern city is strategically connected to seaports and home to an international airport, giving it the opportunity to grow into a regional commercial hub.

Municipal authorities have tried to boost transport infrastructure to keep track with the rapidly expanding economy.

Worsening congestion at Cat Lai Seaport and Tan Son Nhat International Airport are costing businesses time and money, said Phong.

With Ho Chi Minh City aiming for growth of 8 percent to increase the average per-capita income to $8,500 by 2020, we must improve infrastructure, the city’s top leader continued.

Experts said the city will need some VND500 trillion ($22 billion) in the next five years and an additional $45 billion from 2020 to 2030 for infrastructure projects.

Statistics show that Ho Chi Minh City’s sales of goods and services grew 11.4 percent to VND407 trillion ($18.5 billion) in the first seven months of this year against the same period last year.

The city’s import and export turnover from January to July was estimated at $18 billion, an increase of 1.8 percent compared to the same period last year.

Ho Chi Minh City currently has 250,000 household businesses. The city plans to double the figure by turning family businesses into small and medium-sized enterprise, said secretary of the city’s Party Committee, Dinh La Thang.

Figures show small and medium-sized businesses have managed to secure VND93.4 trillion in loans so far this year, accounting for 60.6 percent of the total outstanding debts in the city’s banking system.

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