PM: Vietnam is not the place for transfer pricing
Prime Minister at annual Vietnam Business Forum (VBF)
Prime Minister Nguyen Xuan Phuc reiterated that Vietnam would continue to improve institutional mechanism for a market economy, including the legal system and administrative reforms in an attempt to create a more favorable business environment in the nation.
He promised to assist the private sector to encourage further and stronger development and called on all types of business entities, particularly foreign-invested enterprises (FIEs).
“For the FIE sector, the government expects that foreign investors would be patient and put their hopes on Vietnam’s reforms, while strongly accelerating technology transfer, human resource training and management sharing,” PM Phuc told the annual Vietnam Business Forum (VBF), which opened on December 5.
“Foreign investors should also be more responsible to the local community, taking the initiative to protect the natural environment for sustainable development in Vietnam,” PM Phuc insisted.
While calling for more co-operation among all business sectors – from FIEs to the private sector – PM Phuc noted that Vietnam will not welcome those investors who consider the nation a safe place for pricing transfer and environmentally polluting activities.
“Foreign investors should come here to Vietnam with your brain using modern technology and advanced management skills – and your heart which includes high standards of both business ethics and corporate culture,” PM Phuc said.
The annual VBF 2016 this year has opened with the theme “Strengthening the private sector: Forging partnerships between domestic and foreign enterprises for a harmonious development of the Vietnamese economy.”
This year, the VBF consists of seven programs: empowering SMEs competence; promoting subsidiary industries; raising human resource and training demands; developing the capital market; improving infrastructure and PPP, BOT, BO, BT mechanisms; clean and renewable energy; and climate change awareness and environmental protection.
These topics are essential and appropriate within Vietnam’s economic development strategies, according to the Ministry of Planning and Investment (MPI) – co-organizer of the VBF.
Shortly prior to the VBF opening, Vietnam climbed up 14 ranks to number 73 in the Global Enabling Trade Index, according to the latest World Economic Forum (WEF) report.
The WEF report lists four key sub-indices in terms of performance for each country: domestic and foreign market access; efficiency and transparency of border administration; transport infrastructure; and operating environment.
Of the four, Vietnam scored highest in domestic market access at 4.9, ranking 77th of 136. It also showed great improvement in other indices and a general upward trend. For instance, it ranked 66th in national availability and use of information and communications technology, and 77th in operating environment.
The report says Vietnam has improved significantly in trade capacity, largely driven by improvements in customs efficiency and reduction in waiting time for import and export compliance procedures.
Another clear improvement for Vietnam in the 2016 report is its placement in 19th place for international maritime trade connectivity, nine ranks up over last year.
The WEF report also commends Vietnam for making considerable efforts to improve market access for imports, through increasing the proportion of duty free imports from 55 to 71 per cent compared to 2014, creating favorable conditions for exporting and importing businesses, and enhancing the economy’s commercial competitiveness.
More and more foreign businesses are conducting trade with domestic firms, the report notes. The country’s capability to penetrate foreign markets has also grown due to relatively low customs tariffs, down from 3.8 to 3.3 per cent, and an increase in preferential treatment for countries importing from Vietnam.
However, compared to neighboring countries, Vietnam’s current customs procedures and border access have been undermining its commercial competitiveness, the WEF report notes.
It identifies several problematic factors in imports, including burdensome procedures, tariffs and non-tariff barriers and high cost or delays caused by transportation weaknesses. Export sector problems include difficulties in identifying potential markets and buyers, technical requirements and standards, and the high cost or delays caused by domestic procedures.
(Source: vneconomictimes.com)
