Vietnam’s private sector drives 80% of jobs, key to economic growth, says PM, ETHRWorldEMEA

Vietnam’s Private Sector: A Key Driver of Economic Growth

Vietnam’s private sector is a powerhouse,contributing over 50% to the nation’s GDP and providing jobs for 80% of the workforce.As the government sets its sights on double-digit economic expansion, nurturing private enterprises has become a top priority. Prime Minister Pham Minh Chinh recently emphasized this commitment, affirming to business leaders that private companies will be the bedrock of the national economy.

Economist Nguyen Dinh Cung paints a vivid picture of the sector’s impact, stating that private firms contribute 56% of total investment, exceeding both state-owned enterprises (28%) and foreign direct investment (16%). Despite this significant role, Vietnam is still short of its 2025 target of 1.5 million active businesses, with only 980,000 currently operating. Moreover, 2.5 million non-agricultural household businesses contribute substantially to economic activity.

While success stories like Vingroup and Hoa phat exist, many private businesses grapple with hurdles like bureaucratic red tape, restrictive licensing, and legal uncertainties. These challenges discourage expansion, hindering job creation and economic progress. Cumbersome investment approvals and overregulation further stifle growth, making it harder for Vietnam to achieve its aspiring 2030 and 2045 economic goals.

Navigating the Path Forward

To achieve sustained economic growth, Vietnam must prioritize a more conducive surroundings for private businesses.Simplifying regulations, ensuring legal transparency, and fostering an environment that encourages expansion are crucial steps. Strengthening private enterprises is essential for job creation, workplace stability, and building a resilient national economy.

“To sustain long-term economic growth,Vietnam must simplify regulations,ensure legal transparency,and foster an environment that supports private sector expansion,” experts emphasize.

This conversion requires a multi-pronged approach. Investing in education and skills development can empower the workforce to meet the demands of a growing private sector.embracing digitalization and technological advancements can unlock new opportunities for innovation and efficiency. fostering a culture of entrepreneurship and celebrating business success stories can inspire a new generation of innovators.

By embracing these reforms, Vietnam can unlock the full potential of its private sector and pave the way for inclusive and sustainable economic growth in the years to come.

What steps can Vietnam take to create a more conducive surroundings for private businesses to grow and flourish?

driving Vietnam’s Economy: A Conversation with Private Sector Champion, Lan Nguyen

Introduction

we’re thrilled to have Lan Nguyen, CEO of the Vietnam Private Sector Development Association (VPSDA), with us today. lan, thank you for taking the time to share your insights on vietnam’s robust private sector and the path forward for its growth.

Vietnam’s Private Sector: A Powerhouse

Archyde (A): Lan, can you tell us about the significant role Vietnam’s private sector plays in the country’s economic growth?

Lan Nguyen (LN): Absolutely. The private sector is truly the backbone of our economy. It contributes over 50% to Vietnam’s GDP and provides jobs for 80% of the workforce. Private firms are also leading the way in investments, accounting for 56% of total investments, compared to state-owned enterprises and foreign direct investment.

Challenges and Opportunities

A: While the private sector is thriving, what are some of the challenges businesses face, and how do these obstacles hinder Vietnam’s economic progress?

LN: Indeed, despite the successes, many private businesses grapple with regulatory hurdles. Bureaucratic red tape, restrictive licensing, and legal uncertainties can discourage expansion and hinder job creation. We need to address these issues to ensure enduring growth.

Navigating the Path Forward

A: What steps can Vietnam take to create a more conducive environment for private businesses to grow and flourish?

LN: We need a multi-pronged approach. Simplifying regulations, ensuring legal openness, and fostering an environment that encourages expansion are crucial. We should also invest in education and skills development, embrace digitalization, and promote entrepreneurship.

Thoughts for the Future

A: Lan, if you could offer one piece of advice to young entrepreneurs and a challenge to the government, what would they be?

LN: To young entrepreneurs, I’d say, “Believe in your ideas, take risks, and stay persistent. Our economy needs innovative minds like yours to drive growth.” To the government, I’d challenge them to “Make Vietnam’s regulatory environment the most business-kind in the region within the next five years. let’s unlock our full economic potential together!”

Conclusion

LN: Vietnam’s private sector has come a long way, but there’s still much we can do to support its growth. With the right policies and a supportive environment, I’m confident that our private sector can lead Vietnam to becoming a high-income country by 2045.