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Workshop held on 20 years of Law on Enterprises

Released at: 17:16, 18/11/2019

Workshop held on 20 years of Law on Enterprises

Photo: Minh Do

Law on Enterprises: Achievements, Lessons Learned & Implications for Reform workshop held by CIEM and GIZ.

by Minh Do

The Central Institute for Economic Management (CIEM) and GIZ jointly held a workshop on November 18 in Hanoi on 20 years of the Law on Enterprises: Achievements, Lessons Learned & Implications for Reform, to review and assess the law’s implementation and within the Macro Economic Reforms / Green Growth Programme of Germany’s Federal Ministry for Economic Cooperation-sponsored GIZ.

“This is very important workshop to provide lessons on the reform revolution,” Dr. Michael Krakowski, Director and Chief Technical Advisor of the Programme, told the gathering. “The most important objective is the direction of the Vietnamese State in economic reform and boosting the private sector, which is now permitted to do business in all fields that are not specifically forbidden.”

Implementation of the Law over the past two decades has supported the private sector to contribute significantly to total GDP with the participation of a huge number of local enterprises, Dr. Krakowski added. Vietnam is moving positively in implementing the socio-economic development plan by 2020 and in addressing emerging education, health, and pollution issues. Defining a strategic model is therefore an important and urgent issue for a State agency such as CIEM. “We expect the revised Law on Enterprises to come will ensure the business benefits of the people and the development of the country’s economy,” he said.

Local delegates also discussed the impact from the Law on Enterprises, approved in 1999, 2005, and 2014. The spirit of reform in the first version in 1999 remained in subsequent versions, affirming the business rights of the people. The first version also aimed at cutting the cost of compliance for businesses, ensuring business safety and rights and asset protection by law, and narrowing and eliminating risks from legal policies, institutions, and implementation.

According to Dr. Nguyen Dinh Cung, former Director of the CIEM, the Law on Enterprises has been revised many times and introduced better reforms, but reductions in cost of compliance and risks in doing business have fallen short of expectations. “Legal compliance is a challenge for businesses and especially for long-term, major investors and foreign investors,” he said.

He suggested the agency drafting the law and the agency implementing the law have two different objectives. For instance, the Ministry of Planning and Investment should not be in charge of compiling the Law on Foreign Investment. This should be another agency. The revised law, to be issued in 2020, should be discussed and comments taken from many relevant agencies before completion.

Local economist Ms. Pham Chi Lan agreed with Mr. Cung that the drafting of the law should go to an agency with a good mindset and independence. “Implementation of the law reflects the capacity and compliance of the State and the quality of the institution,” she said.

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