|TFP and efforts in improving trade and investment environment in Vietnam
|Training to improve analytical capacity to identify key sea and land routes
|Loading and unloading import and export goods at Tan Cang Cat Lai. Photo: Hong Dat/VNA
The project supports Vietnam in effectively implementing administrative and institutional reforms through many activities, including technical assistance to apply Customs risk management, improves capacity and develops effective public-private partnerships, which is highly appreciated by the business community.
Achievements in five years of implementation
Motivated by the aid capital of US$ 21.7 million, after 5 years of implementation, TFP has brought impressive results with figures exceeding expectations. According to the Project Management Board, the TFP has supported the Vietnam Government in developing and amending 43 legal documents, including 37 documents related to trade; organized 61 training activities for more than 3,000 people from public agencies and the private sector; strengthened Customs-Business partnership with 3,622 individuals from the private sector who attended training and consultation activities held by TFP; conducted 9,000 survey responses on the level of business satisfaction across the country to promote the reform.
The TFP has helped Vietnam to complete commitments under World Trade Organization’s Trade Facilitation Agreement (WTO-TFA) ahead of schedule. Accordingly, the TFP has supported Vietnam Customs in implementing 20 out of 24 provisions of the WTO-TFA. As a result, Vietnam Customs expects to comply with 100% of its commitments by the end of 2024.
Notably, the achievements result from specialized inspection. Since 2019, the customs clearance time at the border gate has been reduced by half. In addition, the cost of enterprises to complete import and export procedures at the border gate has fallen from US$569 to US$313 for imported goods and from US$420 to US$338 for export goods.
Speaking at the project closing event on April 12, former Director of the Project Management Board, Mr Mai Xuan Thanh, Acting Director General of the General Department of Taxation, said that the TFP is an ambitious project which benefits not only state management agencies but also the business community. In particular, the great results after five years of implementation proved the USAID’s and the contractors’ determination and efforts. Although, in addition, during the implementation phase, there were many difficulties due to the impact of the Covid-19 pandemic, motivated by the great efforts of the Ministry of Finance, the Customs and USAID, the TFP has achieved remarkable results.
According to Claudio Dordi, TFP’s Director, the TFP has supported the Vietnam Government in building a more attractive business environment for businesses, traders and investors. This will become increasingly important as trade recovers from post-Covid-19 and will expedite the implementation of the WTO-TFA to which Vietnam and the United States acceded. Through the effort to reform and facilitate during the five years of implementation, TFP has closely coordinated with the General Department of Vietnam Customs and other government agencies to obtain impressive achievements.
The results show that the project has harmonized and streamlined policies and procedures between agencies of the Vietnam Government, enhanced coordination between central and local levels on trade facilitation strategy, strengthened the implementation and collaboration among at least five localities as well as capacity building activities for local Customs officers; improved the Customs-Business partnership.
Businesses enjoy benefits
USAID has supported Vietnam in improving its ranking on the World Economic Forum’s Global Competitiveness Index and ranking up in the ranking of US export markets. USAID’s support helps boost Vietnam’s economy to become one of the most open economies in the world. However, red tape in import and export are still a significant barrier to trade. The TFP has contributed to reducing customs clearance time and improving competitiveness for import-export enterprises.
Deputy Director of the Project Management Board, Deputy Director of the International Cooperation Department (General Department of Vietnam Customs) Nguyen Thi Viet Nga said that the TFP has helped strengthen the voice of the business community in planning policies, streamlining customs procedures and developing action plans to reduce congestion at seaports. Typically, when Cat Lai Port- the country’s largest container port operated at full capacity amid the Covid-19 pandemic, the TFP held a workshop with ministries, sectors and the business community to provide effective solutions to prevent backlog and facilitate trade and logistics at Cat Lai port.
Experts say that import-export enterprises will enjoy the biggest benefits. Analysis from experts shows that specialized inspection in Vietnam was always a hot problem in the past due to the management by many ministries and sectors, prolonging customs clearance time. As a result, when the project is executed, the customs clearance time has significantly shortened.
On behalf of the business community, Mr Dau Anh Tuan, Director General of the Legal Department, Deputy General Secretary of the Vietnam Chamber of Commerce and Industry (VCCI), said the important beneficiaries of the project are enterprises and import-export businesses. Therefore, the business community highly appreciates the results of the TFP in the past five years.
The project’s key point is that the project’s operation empowers enterprises to assess the quality of customs and commercial procedures. Therefore, enterprises, especially small and medium-sized enterprises, can voice their opinion. The project may end, but the role of enterprises participating in the reform process has been established, which is an important premise for further reforms, Mr Dau Anh Tuan said.
According to Ms Nguyen Minh Thao, Head of the Business Environment and Competitiveness Research Department, Central Institute for Economic Management, the TFP is a new wind, positively impacting changes in ministries and sectors, creating reforms in management, thereby greatly supporting the business community. Furthermore, the project connects management agencies and the business community, provided common solutions to reform administrative procedures and enhance competitiveness, and facilitates customs clearance across border gates.
USAID Country Director to Vietnam, Ms Aler Grubbs, highlighted that reform is a difficult process; USAID desires to make great efforts to promote stronger economic growth, but TFP will accompany Vietnam’s economy, creating favourable conditions for enterprises as the impressive results achieved by the TFP are a typical example in the close partnership between Vietnam and the US.