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Hanoi eyes further improvements in 2022 competitiveness index
Hai Yen 15:16, 2022/08/24
Last year, Hanoi was named among the top 10 provinces/cities in the PCI 2021 index, ranking 10th out of 63 provinces and cities.

Hanoi is looking to continue improving its performance in the 2022 Provincial Competitiveness Index (PCI), following a positive result from the previous ranking.

 Processing administrative procedures for businesses at Hanoi's Department of Finance. Photo: Pham Hung

The target was set in the city’s directive No.13/CT-UBND on improving the PCI score that was signed off by the Chairman of the Hanoi People’s Committee Tran Sy Thanh on August 22.

Under the directive, Hanoi aims to stay among the top business-friendly localities by addressing its PCI’s sub-indices of low scores or in the decline, especially the criteria of “Transparency and Information access” (ranked 57th out of 63 provinces/cities, or a fall of 23 places from 2020).

Other indexes that have improved compared to 2020 but remain low in the ranking include “Entry Costs” (44th out of 63rd); “Land Access and Tenure” (50th); “Law & Order” (48th); “Policy Bias” (51st); ”Proactivity” (29th); and other criteria related to the performance of public servants, administrative procedures, namely the “Time Costs” and “Informal Charges”.

The mayor called for the local authorities to make efforts in improving the performance of the “Informal Charges” (29th), which has seen a drop by three places from the previous year.

Thanh also expected the city to maintain other sub-indices with a high grades, including “Labor Training” (1st) and “Business Support Services” (4th).

Last year, Hanoi was named among the top 10 provinces/cities in the PCI 2021 index, ranking 10th out of 63 provinces/cities.

The city, however, dropped one place from 9th in 2020 to 10th in the 2021 report, albeit being graded 68.60, higher than the previous year score of 66.93.

Dau Anh Tuan, the Director of the Legal Department under the Vietnam Chamber of Commerce and Industry (VCCI), the agency responsible for the PCI, noted major economic hubs such as Hanoi and Ho Chi Minh City suffered more severe impacts from the Covid-19 outbreak compared to others.

He pointed out the fact that Hanoi continued to stay in the top 10 nationwide has been “a success”.

“Hanoi has moved in the right direction in improving the business environment by promoting e-Government and digitalization of administrative procedures, for which I believe the city would bounce back stronger in the coming time,” he added.

This is since the overall business environment in Vietnam has improved significantly over the years, as 2021 was the fifth year in a row the average PCI has been above 60 points on the 100-point scale, he said.

The 2021 score landed at 65.3 points, which is 1.6 points higher than the Core Index in 2020 (63.7 points), continuing a general upward trend between 2017 and 2021.

The 2021 PCI called for provincial governments to focus more on accelerating the digitalized settlement of administrative requests, and reducing constraints in the tax, land, social insurance, environmental, fire safety, and market regulation procedures.

Registration of conditional business lines is another area of concern, as the compliance burden remains substantial. At the same time, provincial authorities should make further efforts to effectively implement business support programs as well as measures to aid domestic firms in international economic integration, he continued.

Introduced in 2005, the (PCI), the result of a long-standing collaborative effort between VCCI and the US Agency for International Development (USAID), is designed to assess provincial economic governance, the ease of doing business, and administrative reform efforts by provincial governments in Vietnam to boost private sector development.   

The 2021 PCI report was developed from responses by 11,312 firms, including 10,127 domestic private businesses operating in 63 provinces and 1,185 foreign-invested enterprises (FIEs) operating in 22 provinces in Vietnam.  

Major cities of Haiphong and Danang and provinces of Quang Ninh, Dong Thap, and Vinh Phuc secured the top five positions in the PCI 2021 rankings, having achieved very positive results in economic development and Covid-19 response policies, as perceived by firms. 

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