On the morning of 19 December 2019, the Private Sector Forum for improvement of economic development mechanism and policies was held in Hanoi. The forum was chaired by Mr. Nguyen Huu Nghia, deputy head of Central Economic Commission, Mr. Nguyen Ngoc Bao, vice chairman of National Assembly Economic Commission, and Mr. Nguyen Trong Dieu, Chairman of Vietnam Private Business Association.

The discussion by Mr. Nguyen Trung Chinh, Chairman/CEO of CMC Corporation, Vice Chairman of Vietnam Private Business Association confirmed the importance of private sector to economic development of the country. In two years from 2018 to 2019, among top 10 IT-Telecommunications enterprises, there are 6 representatives of the private sector. CMC Corporation is proud to be ranked in the top 2 prestigious IT-Telecommunications enterprises of Vietnam in 2018-2019.

Content of the entire discussion of CMC:

Discussion of CMC at the Private Sector Forum for improvement of economic development mechanism and policies

"TECHNOLOGY ENTERPRISES: ASPIRE TO INSPIRE THE DIGITAL NATION

1. On the performance of private sector in 2019:

According to the report of the State Bank, in 2019, Vietnam's economic growth can reach 7%, being the fastest growing economy in ASEAN and one of the world's fastest growing economies, to which the private sector makes the largest contribution. The private sector is accounting for about 42% of GDP of the country and 30% of state budget. The growth rate of private enterprises (not including individuals and households) reached nearly 12% in 2017, higher than the overall rate of the economy in the same year (6.81%). Private sector and collective sector account for 26% of export value; 34% of import value, and contributed to 32.26% of state budget in 2017 and 38.20% in 2018, significantly exceeding the benchmark of 29.43% in 2016, the year in which the Resolution was yet to be issued. The government's national vision to 2030 is towards per capita income of 18,000 USD, and for Vietnam to become a developed country with high income in order to celebrate 100 years of independence.

2. Review and general proposal:

- Looking at the overall picture, it can be seen that the environment and policies are getting more favorable, facilitating private enterprises to contribute to the national economy.  The 5^th Plenary Session of the 12^th Central Committee issued Resolution No. 10-NQ/TW, an important resolution on developing the private sector into a motivation of the socialist-oriented market economy. The Government has issued Resolution No. 98-NQ/CP dated 3/10/2017 on the Action Program for implementing Resolution No. 10-NQ/TW.

- In the last 2 years, with the spirit of accompanying enterprises, the whole political system has been fiercely providing supports for development of the private sector. Essentially, regulations relating to business activities no longer discriminate economic sectors, even in terms of access to resources for business development. In constructing synchronous and modern socioeconomic infrastructure, especially traffic, energy, telecommunications, etc. and creating favorable conditions for the private sector to access to and equally use such infrastructure at reasonable cost, the private sector is increasingly encouraged to participate in investing and developing infrastructure systems through public-private partnership, construction bidding, etc. The Government issued Decree No. 63/2018/ND-CP dated 4/5/2018 on investment in the form of public-private partnership.

- However, from practical perspective, we propose drastic and strong actions of the government at all levels, from the central to the local, to promote the efficiency of resolutions and policies of the Communist Party and the State.  For example, a survey conducted by VCCI with 10,000 enterprises in 2018 showed that petty corruption ("grease the wheel" expenses) was reduced from 66.3% in 2015 to 55%. However, this is really a barrier which consumes money, time and manpower of not only the private sector but also the entire national economy. In order to improve this situation, amending the law is not enough. Another important factor is reforming and changing current administrative procedures. Non-transparent administrative procedures in many areas are the cause of harassment and petty corruption. For example, it takes the court 3-5 years to resolve a simple economic dispute. How can investor be assured to invest, or enterprises to focus on innovation and signing contracts in that context?   

1. Special proposal for information technology industry:

- In the last few years, information technology (IT) has always been the industry with the fastest and most impressive growth rate in Vietnam, contributing significantly to GDP growth and the state budget. According to Vietnam's economic development plan to 2020, information technology will become one of the key industries for our country to soon achieve the goal of industrialization and modernization in all industries and fields.

- Therefore, the Government should encourage private enterprises to contribute to building the digital nation through promoting technology and digital solutions, so that we are able to participate in regional and global production networks and value chains by promoting digital services abroad. Policies should be developed to support the development of IT market; especially, attention should be paid to encouraging the use of locally created IT products and services, and the movement of Vietnamese people using "Make in Vietnam" IT products. The Government should create a legal corridor to form organizations providing services to support organizations and individuals in the process of implementing procedures related to e-government. Policies to prioritize the use of domestically-branded and locally-produced IT products in the works and information systems of the Communist Party and the State must be developed.

 - The Government should create mechanisms to attract investment and develop the IT market, create favorable conditions for the private sector to actively participate in the process of international economic integration, exploit opportunities to expand to international market, including the market in: Japan, South Korea, USA, Europe, etc.

- Creating conditions to build Vietnam into a "Digital Hub" of APAC: In the roadmap to building digital nation, digital infrastructure is required for the construction of digital government and digital economy. The components of digital infrastructure include connecting devices, data and applications, legal framework and human resources. The Government should encourage the rapid and sustainable development of digital infrastructure, and the construction of data centers, telecommunications infrastructure and Smart City in many regions across the country.

- Many large technology corporations of Vietnam are setting the goal of building a technology ecosystem, turning Vietnam into a "Digital Hub" for data transfer, data connection and telecommunications infrastructure of Asia-Pacific. Specifically, CMC Corporation has been aggressively promoting the following action programs for the Digital Hub project: building neutral data centers with high connectivity and large scale in Ho Chi Minh City; investing in building the Cross Vietnam Cable System (CVCS) - the only cable system in Vietnam to directly connect to the Southeast Asia mainland cable network - A Grid; developing the open infrastructure ecosystem C.OPE ² N for businesses and organizations.

- I hereby would like to propose to the Government to create conditions for technology firms like CMC to carry out this great project by developing and allowing open connection mechanism for technology enterprises to join hands in this project.

To end my discussion, I wish Vietnam Private Business Association to constantly grow and develop business ecosystem not only in Vietnam but also in the world to create breakthroughs for the economy of our country.

Wish you health, success and prosperity. Thank you.

Chairman of Board of Directors/CEO of CMC Corporation