Hanoi (VNA) - Vietnam needs a strategy to promote the development ofprivate firms with a focus on quality, as their contribution to the economyremains modest,🧸 attendees heard at a conferen💯ce in Hanoi on March 15.

“After more thanthree decades of Doi Moi (Reform), the country still does not have a truedevelopment strategy for private firms,” economic expert Tran Dinh Thien saidat the forum about private sector development held by the Vietnam Institute ofEconomics. He said that moreattention is paid to how many firms are established rather than how healthythey are. According to Thien, theeconomic structure of Vietnam is showing considerable problems. He citedstatistics showing that the private sector altogether contributed around 40 percentto the country’s gross domestic product (GDP), of which, some 32 percent wasfrom business households and only eight percent was from private firms.State-owned enterprises (SOEs) contributed around 28 percent. SOEs and businesshouseholds are the two major contributors to GDP but they both have problems incapacity. Business households are of small scale while SOEs lack efficiency inoperation, Thien said, adding that these two forces are not major contributorsto Vietnam’s successful economic integration and international competition. He pointed out thatprivate firms faced a number of barriers, such as more difficult access toresources than other economic sectors. The role of theprivate sector must be leveraged in the next five to seven years, he said, addingthat private firms should be regarded as a dynamic driver of the market economyand it is critical to offer them fairness in accessing economic resources. According to BuiQuang Tuan, Director of the Vietnam Institute of Economics, the businessclimate of Vietnam needs to be further improved together with the transition ofthe economic growth model towards promoting innovation. "The digitaleconomy and Industry 4.0 are disrupting a number of industries but offeredopportunities for firms to speed up and make breakthroughs," Tuan said. He said that Vietnamhas a number of policies to promote business development but the enforcement ofpolicies remains weak, stressing that it is important to ensure that policieswork to benefit firms. Vietnam’s privatesector has around 700,000 firms and 5.2 million business households. The country targets onemillion firms in operation in 2020 and is encouraging business households to betransformed into firms in order to achieve this goal.-VNA