The Provincial Competitiveness Index (PCI) 2013 is the result of a major, ongoing collaborative effort between the Vietnam Chamber of Commerce and Industry (VCCI) and the U.S. Agency for International Development (USAID). The PCI 2013 is the ninth PCI report on the quality of economic governance across 63 provinces, providing objective indicators of the quality of economic governance in areas which are crucial for investment and growth. It was developed on the comments of 8,093 domestic non-state businesses and opinions of 1,609 foreign invested businesses operating in the country, in order to place provincial competitiveness in the broader context of Vietnam as an international investment destination.
In recent years, PCI included 9 sub-indices, but this year, the Provincial Competitiveness Index 2013 has some important changes and adjustments in methodology to keep up with changes in the business environment and the regulatory landscape of Vietnam. Specifically, new data are used for constructing sub-indexes while some outdated indicators were dropped. Moreover, a sub-index of “Policy Bias” has been revitalized to reflect businesses’ concerns about the presence of a level playing field.
The overall PCI comprises ten sub-indices, reflecting economic governance areas that affect private sector development. A province that is considered to perform well on the PCI is one that has: including: 1) low entry costs for business start-up; 2) easy access to land and security of business premises; 3) a transparent business environment and equitable business information; 4) minimal informal charges; 5) limited time requirements for bureaucratic procedures and inspections; 6) minimal crowding out of private activity from policy biases toward state, foreign, or connected firms; 7) proactive and creative provincial leadership in solving problems for enterprises; 8) developed and high-quality business support services; 9) sound labor training policies; and 10) fair and effective legal procedures for dispute resolution.
In 2013, Ben Tre had made a spectacular leap from the 26th position 2012 to the 6th position in the 2013 PCI report. This result has shown considerable efforts of Ben Tre in improving the investment environment and quality of economic governance of the province. Indeed for years, Ben Tre was consistently the best performing province in the ranking of informal charges.
In 10 sub-indices, Ben Tre has 6 indexes increasing, in which, the highlight of the PCI 2013 of Ben Tre is 4 increasing indices: time costs (increase 2.84 points compared with 2012); business support services (increase 2.32 points), set legal institutions (increase 1.91 points) and informal charges (increase 1.59 points). Specially, all 4 indices are indicators which fell in period 2011-2012, showing that Ben Tre has implemented strictly to improve the environment for business investment, through focusing on overcome the weaknesses of the issue. In which, the "time cost" and " informal charges" indices increase not only strongly but also in very high position, is 8.03 compare with highest point 8.36 and 8.31 compare with highest point 8.94. Both indicators in 2012 were quite low. This is demonstrated the effectiveness the public administration reform of Ben Tre in 2012-2013.
Year 2013 was an economic crisis one that affects all aspects of social life. The increasing of the index "business support services" is showing that the receipt and processing procedures of the professional division has improved more effectively, receiving appreciation from businesses in the province. After establishing nearly 2 years, Investment Promotion Agency of Ben Tre (IPA Ben Tre) with the function of the state management in the field of promotion in Ben Tre province, initially showed the success of a new model "one stop shop", which is dynamic, transparent and the only place that businesses need to contact for administrative procedures.
"Legal institutions" index in 2013 also had a sharp increase compared to 2012. However, this index does not increase much if compared with the year 2011. Therefore, the province must try more, because there was a big gap if compared with the highest index of Tien Giang provinces (5.77 points and 7.13 points). Ben Tre need to learn more in making the law more transparent and closer to the local businesses.
Besides the good results, the province should not ignore the weaknesses which were pointed out in PCI 2013, specially the two indicators "entry cost" and "transparency".
“Entry cost” had declined 0.82 points, although still in the high position (7.7 points), but there is a big gap compared with Tra Vinh (9.47 points). Compared with other provinces, Ben Tre’s index only in the middle group. To improve this index, in 2014, Ben Tre should continue to perfect the "one- stop shop” model, especially the coordination between departments in the procedure for receiving and issuing Investment certificates which need the support of different departments.
A notable decline index is "transparency", this is second consecutive years Ben Tre decreasing this index (decrease 0.49 in 2012 and 0.31 in 2013). The causes is the information system of provincial such as policy, planning, master planning, legal documents … have still not propagated popularly to businesses. To improve quickly and thoroughly this index, the information channel of the province with the people must be expanded more and more, especially the official website of provincial departments. Information on these websites must be update usually, clearly, and easily to access, besides Vietnamese also need other common languages such as English, Japanese. The legal documents and plans, master plans… should be also published to businesses by different ways such as through website, brochures, publications…
Increasing 20 ranks on PCI and ranked in top 10 is a great success of Ben Tre in 2013. This success should be considered as a major motivation to promoting Ben Tre continue to improve the business environment and the quality of economic governance in the next time. If Ben Tre can maintain and continue to develop this result, Ben Tre will be a potential destination for domestic and foreign enterprises.
Author: Author: Huynh Anh (BAI) - Photo: ST