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Minister of Planning and Investment Bui Quang Vinh: It should be open to private sectors to invest in infrastructure

Reporters from Dong Nai newspaper had an interview with Minister of Planning and Investment Quang Vinh about the issues on his recent business trip to Dong Nai province: The solutions to the achieve socio-economic objectives, business support to overcome difficulties and especially the mobilization of extra-budgetary resources for infrastructure development.


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* Reporter: Mr. Minister, what are the issues that catch your most attention on the trip to Dong Nai?

- Minister Bui Quang Vinh: The purpose of the mission by the Ministry of Planning and Investment to Dong Nai this time is to view the report on the implementation results of socio-economic development for the first 6 months, especially the measures to remove difficulties for enterprises recommended by the province. On the other hand, the Ministry would like to view the proposal to remove the difficulties to create a breakthrough in mobilizing resources for development of the country in general and Dong Nai in particular. The final matter is the recommendation on regional linking and how to have close associations among localities in the southern key economic region to use the national and the local resources more effectively in the perspective of the entire region, not single localities.

*As for the mobilization of resources for infrastructural development, which solutions are considered breakthroughs in your opinion?

- We are facing a major shortcoming, which is that the need for infrastructural development of the national socio-economy is growing; in fact, the infrastructure is still inferior compared to the need for development. On the contrary, the budget for infrastructural development is decreasing even in terms of proportion because the needs for expenditure on the other problems are rising. Therefore, it is necessary to change the view that the construction of socio-economic infrastructure is mainly dependent on budget.

Instead, there should be another approach, which is, in my opinion, that it should be open for the private sectors, non-state sectors to take part in building socio-economic infrastructure. Small budget supply should be used only in sectors that inaccessible or non-profitable to other components, such as public welfare, national security and defense. And as for all other sectors, when investment may result in capital recovery or it may be profitable, it is necessary to create favorable conditions in terms of policies to attract and promote domestic and foreign private investment. Many countries around the world have done this, Vietnam also needs to follow the trend though it will encounter a lot of difficulties. These difficulties reveal themselves even in the legal framework, ways of implementation, requirements for transparent procedure... Because no one brings money to invest in a place where the law is unstable and accounting is not transparent...trust must be created at all cost, and if we can do it, I believe that we can still call for investment even in big projects, there is no need to depend on budget.

* As for regional linking, what obstacles are we facing, Minister?

- Regional linking is a common problem of the world. In regional countries, when socio-economy planning is conducted, it is not allocated according to administrative sites. Our inadequacy is dense population and small area which is divided into administrative units,. With the current mechanism, regional linking is facing a lot of troubles, each locality is like a separate fortress of economy; therefore, regional advantage is limited.
 

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Minister of Planning and Investment Bui Quang Vinh (on the left) visiting the Long Duc Industrial Park    

The Government has found this issue and is currently attempting to divide the country into six different regions, of which the southern key economic region is considered the motivation of the country's development, but the link among the regions is still loose as it has been operated by no organization and there has been no proper policy on exploitation. This issue has re-evaluated by the Government, and it is assumed to be necessary to be more persistent in coordinating the management of regions in the perspective of taking common advantage.
 
* What we need to do with the issue of enterprise support, Minister?

- Supporting businesses is also one of the purposes of the business trip to Dong Nai this time. The Government has issued Resolution 13 about tax reduction and relaxation to help businesses reduce the difficulties, beside there are also many other solutions about procedure policy for enterprises to operate their businesses much easier. However, the important issue is that currently, the enterprises find it difficult to get capital access; this is a key point because more than 70% of enterprises operating production and business are dependent on bank loan, while interest rates are still very high; on the other hand, it is not easy to get access to bank loan. The Government and State Bank also have drastic decision to reduce interest rates for both new and old debt to below 13 per cent and 15 per cent; at the same time, bad debt policy is being restructured so that enterprises’ bad debt will be handled and they are enabled to get access to decreased interest rate. If the capital flow is good, policies on tax reduction and relaxation as well as other policies are more open, I think enterprises will overcome difficulties.

* Thank you Minister.

Source: The Dong Nai
 

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