VCCI deputy general secretary says private-sector revenue is largely from finance and real estate, with manufacturing a small share

NARRATIVE SUMMARY (EN): The article discusses the paradox of Vietnam’s private sector. According to Mr. Đậu Anh Tuấn, Deputy General Secretary of VCCI, despite progress after nearly four decades of Renovation, the private sector still faces bottlenecks. 'Private enterprises are numerous but not strong; dynamic yet shallow; large contributions but their position in the global value chain remains modest,' he said. One notable issue is an unbalanced sectoral structure: the majority of revenue from large private groups comes from finance and real estate, while manufacturing and processing hold a small share. In addition, firm size remains a persistent weakness: about 97% of private enterprises are small and medium-sized, most with fewer than 10 employees, and there are around 5 million individual business households. Small scale hinders investment in technology renewal and competitiveness; the share of Vietnamese firms linked to global value chains is falling, while productivity in the non-state sector remains significantly lower than in the state and FDI sectors. Furthermore, investment in R&D is limited; many firms operate as family businesses, lacking transparency and modern governance. Drawing on experiences from Japan, Korea, and China, Tuấn argues that no economy can succeed in development transformation without a strong private sector; enterprises must grow large enough to invest at scale, drive innovation, and participate deeply in global value chains. He also stresses that relying on external resources is necessary, but in the long run internal capacity must be strengthened; the government’s role is not to intervene directly in business activity, but to create a competitive environment, support the formation of internal capabilities, and accompany enterprises with a long-term vision. What path forward? To enable private-sector groups to lead, recommendations include shifting away from real estate and finance toward manufacturing and technology; increasing investment in R&D and innovation; building an ecosystem linking large and small firms; developing a deeper capital market; upgrading governance and professionalizing operations; pursuing internationalization strategies; and implementing institutional reforms to protect property rights, reduce the criminalization of economic relations, reduce dependence on FDI, and manage risks from multi-sector growth lacking depth. In summary, Tuấn suggests the 40-year journey marks maturation of private enterprises in Vietnam; by 2030 and 2045 visions, the objective is not just more firms or GDP, but to form a private sector with strong technological capability and leadership in regional and global value chains, enabling the economy’s modernization.