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Businesses still struggle to cut through red tape

November 14, 2014

– DA NANG — More than 20 per cent of the central city’s 15,000 businesses complained of arduous delays or informal charges to access information regarding licences for land, construction and businesses.

Vice-chairman and general secretary of the city’s Association of Small and Medium Sized Enterprises, Nguyen Van Ly, told Viet Nam News on November 13, 2014 at the start of a project to improve business administrative procedures and access to information.

The project, developed by the city’s Centre for Promotion of Human Resources Development, aims to help businesses cope with administrative procedures, increase transparency and landscape the investment environment.

The project, which won an award from the Viet Nam Anti-Corruption Initiative Programme co-organised by the World Bank and the Government Inspectorate of Viet Nam, will survey 300 businesses for ideas on promoting transparency and improving Provincial Competitive Index (PCI) numbers.

“Most businesses in the association ask for reform that creates a one-stop shop that dismantles excessive procedural barriers,” Ly said.

“Enterprises waste time dealing with endless series of procedures to get land, construction and business establishment certificates. They often pay informal fees to some middle man at some department to quicken the process,” he said.

Despite making considerable administrative reforms, Da Nang has struggled as some administrative fields drag their feet because bribery among public servants is so deep-rooted.

Doan Thi Thanh Thuy, an owner of a private company in the city, said she had to waste too much time to get a licence.

“A land allocation licence took me two weeks or more. I had to go back and forth with lots of paper, getting permissions from several departments, including natural resources and environment, planning and investment, industry and trade, health and grassroots administration,” she said.

“Businesses could save time if all the departments and agencies came together to form a one-stop shop to help businesses pay fees and get licensed,” she said.

Vice-director of the city’s Internal Affairs department, Che Viet Son, said the city has incorporated new digital procedures in 1,200 public services, and built a data centre and consultant office at the Software park to assist businesses and local residents.

Le Duc Vien, deputy director of the Centre for Promotion of Human Resources Development, said she hoped the recently awarded project speeds up the city’s administration reform.

According to a 2012 survey in Da Nang, 47 per cent of 188 businesses had to pay informal charges and 18 per cent of those businesses also had to bribe bank staff to access loans. While these numbers have reduced, 20 per cent are still beleaguered by these issues.

Vien said the project would target 70 per cent of the enterprises previously surveyed to help them build administrative skills and improve relationships between businesses and leadership.

A national survey by the Viet Nam Chamber of Commerce and Industry also revealed similar problems. According to the survey, 75 per cent of businesses from 63 provinces and cities said that they had to get investment information from personal relations, and 40 per cent of businesses complained of excessive delays or informal charges to access information.