VCCI stresses decisive role of private sector As many as 58% of private enterprises in Vietnam are not earning enough to pay taxes, which means the need for a stronger focus on making the private sector a driving force for the economy, according to an official from the Vietnam Chamber of Commerce and Industry (VCCI). Dau Anh Tuan, Head of VCCI's Legal Department told the Economic Forum on restructuring state-owned enterprises held on Friday in Hanoi, that economic restructuring should aim at making private enterprises stronger and that they hold a decisive role in the economy. Head of VCCI's Legal Department, Dau Anh Tuan, speaks at the Economic Forum on restructuring state-owned enterprises held in Hanoi on December 2 Tuan, however, admitted that the private sector was facing various challenges. “A report by Fulbright showed that at now only the FDI sector is doing well, while the state, private, and household businesses are all showing problems," Tuan explained. "But in the long-term, the FDI sector cannot be the driver for the economy because FDI enterprises come to Vietnam to take advantage of our cheap labour which will not last long. Therefore we should focus on developing private enterprises in the coming time." A recent survey by VCCI on 10,000 private enterprises showed that most of them are operating less effectively than before and many are downsizing. Statistics from the General Department of Taxation showed that as many as 58% of private firms don't make enough profits to pay tax. "Vietnamese private enterprises are facing lots of challenges in accessing loans and other resources compared to those from the state-owned or FDI sectors," Tuan added. "Only 30% - 40% enterprises are able to access bank loans compared to 80% of state-owned enterprises. This is because private enterprises are given fewer incentives while they have weaker management and IT ability and less experience. The VCCI representative called on better policies and preferential treatment for private enterprises so that they can grow better. We're targeting at one million private enterprises by 2020, but I think what's more important is that we should help these one million grow to play a decisive role in the economy, Tuan said. By Bich Diep, dtinews.vn