Thursday,  Nov 15, 2018,12:50 (GMT+7) 0 0
Vietnam inches down in WB’s ease of doing business rankings
By Thanh Thom
Thursday,  Nov 1, 2018,14:48 (GMT+7)

Vietnam inches down in WB’s ease of doing business rankings

By Thanh Thom

A man conducts business establishment procedures in the capital city of Hanoi – PHOTO: THOI BAO TAI CHINH VIET NAM

HCMC – Vietnam edged down one spot to 69th place in the World Bank (WB) Group’s annual ease of doing business rankings, the global lender said in its “Doing Business 2019: Training for Reform” report, which was released yesterday, October 31.

The annual report measures the effectiveness and quality of business regulations based on 11 indicator sets: starting a business, obtaining construction permits, getting electricity connections, registering property, obtaining credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency and following labor market regulations.

The past year has witnessed a peak in reform activity worldwide. From June 2017 to May 2018, 128 economies executed a record 314 regulatory reforms, improving the business climate.

“East Asia and the Pacific region have made significant progress in enabling entrepreneurship and private enterprise. As the reform momentum continues building in the region, those economies that lag behind have the opportunity to learn from the good practices adopted by their neighbors,” stated Rita Ramalho, senior manager of the WB’s Global Indicators Group, which produces the report.

The region is home to two of the world’s top 10 Doing Business economies, Singapore and Hong Kong. In addition, China is one of this year’s top 10 improvers, advancing more than 30 spots to 46th place in the global rankings. The region’s economies carried out a total of 43 reforms in the past year, with a major push seen in the areas of starting a business and getting electricity connections.

Vietnam adopted three reforms during the past year to improve the ease of doing business for domestic small and medium enterprises. Improvements were made to make it easier to start a business, pay taxes and enforce contracts, according to the WB.

First, Vietnam made starting a business easier by publishing the notice of incorporation online and by reducing the cost of business registration.

Since Doing Business began in 2003, starting a business has been the most common area of reform in East Asia and the Pacific. In Vietnam, the average time to start a business has been almost halved to 17 days, from 63 days in 2003, and the cost has been significantly reduced from 29.9% of the income per capita in 2003 to 5.9%.

Second, Vietnam made paying taxes easier by no longer requiring hard copy submission of the value added tax return and allowing joint payment of the business license tax and value added tax.

The country also made paying taxes less costly by reducing the employer’s contribution to the labor fund from 1% to 0.5%.

Third, Vietnam made enforcing contracts easier by making judgments rendered at all levels in commercial cases available to the public online.

The Southeast Asian nation also performs well in the Doing Business areas of obtaining construction permits, getting electricity connections, and registering property.

Building a warehouse, for example, takes on average 166 days and costs 0.7% of the warehouse value, compared with the global averages of 158 days and 4.8% of the warehouse value.

Since its inception in 2003, more than 3,500 business reforms have been carried out in 186 of the 190 economies Doing Business monitors.

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