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Private economic sector development in the international integration process
8/3/2007 16:2' Send Print

Over the last 20 years of its national renewal process, Vietnam has established a multi-sector economy with the development of different economic sectors. Domestic private economy is a young and dynamic sector. These businesses are owned by the Vietnamese people. They are non-State or have State funding but are not controlled by the State, and have no foreign investment, or have foreign funding but are not controlled by foreign investors. They do not belong to the collective and are not cooperatives. Since 2000, the private economic sector in general and private businesses in particular have strongly developed, affirmed their motivational role, and made further contributions to the national socio-economic development process. Recently, with the enforcement of the Business Law and many other reform measures, the business environment in Vietnam has been greatly improved. The people’s right to do business has been widened according to the principle allowing them to operate in all areas not forbidden by law. The people are encouraged to do business to enrich themselves and the country. All private businesses are encouraged to be involved in export activities and small and medium sized businesses are assisted to develop. In this environment, the private sector, particularly private businesses have rapidly developed in quantity and quality, making positive contributions to economic growth and social development. They have helped to generate jobs, increase investment funds, broaden exports, and accelerate industrial, agricultural and servicing growth rates, markets, and economic and administrative reforms. The recent rapid development of the private sector can also be attributed to the country’s international economic integration process which began immediately after the renewal process was launched, and particularly from the middle of the 1990s when Vietnam began to participate in ASEAN, ASEM and APEC and expand bilateral relations with other countries in the world. Vietnam’s products have found more outlets in other countries, generating opportunities for Vietnam’s businesses, including those in the private sector to develop production and sell their products in regional and world markets. This is particularly important now that the domestic markets are limited as the country remains poor, and the people’s income and purchasing power remain low. However, in their recent development period and the coming period, this economic sector has been confronting numerous difficulties and obstacles. First, the private sector and private businesses in Vietnam in general are small, weak, newly established and lack necessary resources and coherence to develop and be more competitive. Second, the domestic business environment has met with numerous difficulties and unequal treatment. Third, they have confronted challenges of the international business environment in the integration process.

However, with their strong determination and Party and State’s correct guidelines and policies, the private economic sector will certainly overcome all challenges, be able to achieve great success in their business, and rapidly and sustainably develop to become a strong motivation for Vietnam’s economy in the development and integration process.

Pham Chi Lan