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Parliamentarian Pham Trong Nhan has proposed that the National Assembly enact a dedicated law to support private sector development, aiming to raise the sector’s contribution to 70% of GDP by 2030. Speaking during the April 20 discussion on socioeconomic development, he said the private economy currently accounts for about half of GDP each year and more than 30% of the budget, but still faces structural and institutional constraints.
Pham Trong Nhan, Vice President of the Ho Chi Minh City Federation of Labor, said the private sector’s performance remains limited by several difficulties, including a high rate of enterprises exiting the market and a relatively small share of exports—less than 30%, with the remainder largely attributed to foreign direct investment (FDI).
He said the “gap” indicates the private economy operates mainly in the domestic market and in low-value segments. Strategic sectors, high-tech industries, and infrastructure, he added, still lack leadership from the private sector.
The vice president also pointed to ongoing challenges in access to credit, saying the private sector operates within an institutional framework that is not commensurate with its development needs.
The proposal was made in the context of the Politburo’s Resolution 68 on private sector development, which sets a target for the sector to account for 70% of GDP by 2030. The Prime Minister has also pledged to create conditions for private enterprises to develop, but Pham Trong Nhan said the National Assembly has only issued Resolution 198 on some mechanisms and policies for private sector development.
He argued that a dedicated private sector law should establish foundational principles to protect rights and ensure stability and predictability in the legal environment. This, he said, would provide a basis for specialized laws to reference and enforce consistently, rather than relying on additional isolated incentives.
Pham Trong Nhan said the law should be built around three pillars: “equality, substance and consistency” among economic components in access to resources and opportunities for development, including land, credit, investment, and markets.
He also proposed creating a “safe legal zone” for production and business activities, including long-term protection of property rights for those who act in accordance with the law at the time of decision. “This provision could help minimize risks arising from policy changes or different interpretations in enforcement,” he added.
Mr. Trinh Xuan An, a member of the National Assembly’s Defense, Security and Foreign Affairs Committee, said small and medium enterprises (SMEs) are the most important growth engine but face significant difficulties.
He said the “deepest problem” is that institutions are not truly conducive to SMEs. While many enterprises, he noted, “do not lack opportunities,” they still struggle with investment procedures, expanding production, accessing resources, and implementing projects.
“An enterprise may accept market risk, but it is hard to feel confident when the legal environment still harbors uncertain factors,” he said.
Mr. Trinh Xuan An proposed shifting from a managerial mindset to accompanying enterprises. He said policies should focus on reducing compliance costs, reducing legal risk, and designing substantive mechanisms so SMEs can access capital and land and participate later in the value chain.
On administrative reform, he suggested the government set criteria to ensure reductions are substantive and eliminate unnecessary procedures that create burdens for people and businesses.
Vietnam aims for economic growth above 10% this year, and Pham Trong Nhan said capital is a key resource for achieving that goal. He proposed that the State Bank consider selectively loosening credit limits, prioritizing banks with good asset quality and low bad debts, to channel funds into production and business rather than applying a blanket cap across the system.
He said credit growth of around 15% makes it difficult to create room for double-digit growth. “If capital is not commensurate, the goal of high growth will be hard to achieve,” he concluded.
A poll cited in the discussion recorded 178 votes cast: 85% said the National Assembly should enact a law on private sector development, while 15% said it should not.
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