A bonfire of red tape to unleash investment and complete stalled projects across Vietnam may drive economic expansion but is unlikely to offset the damage caused by US tariffs and the fuel crisis which have threatened the country’s growth ambitions.
Vietnam’s Communist Party General-Secretary and President To Lam, the most powerful leader in a generation, has set an annual growth target of 10 per cent until 2030 to galvanise a nation whose ponderous bureaucracy has snarled private investment and slowed development of infrastructure projects.
Last month, the government issued eight resolutions to cut 680 administrative procedures and simplify hundreds more to speed up approvals for new businesses in sectors ranging from casinos to importing cars.
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To Lam, who is currently in India signing deals ranging from rare earths to payments systems and fruit, wields decisive power in Vietnam, which should speed up decision-making as the country strives to become a high-income nation by 2045.
A blizzard of draft decrees aimed at slashing red tape is queuing up for approval by a government that has already reduced the number of ministries by a quarter and slimmed down the civil service.
“Vietnam’s government has recently issued a slew of resolutions and directives to cut administrative procedures and simplify business conditions,” said Heng Jian Xin, senior country risk analyst at BMI, a unit of Fitch Solutions.