Continuing efforts to improve provincial economic governance

It is the fourth consecutive year in which the score of the median province is above 60 points while the gap between the best-performing and worst-performing provinces is narrowing. It reflects stronger determination to reform and improve the business climate across localities. The situation of some localities being committed while some are apathetic has subsided and no locality wants to stay in the same position in the reform race.

Specifically, among the 12,300 enterprises surveyed, 44.9% reported they paid informal charges in 2020, a sharp decline from 66% in 2016. Only 3% of enterprises stated that they had to spend over 10% on such charges, compared to 9.1% in 2016, while up to 84.4% said the charges were at an acceptable level.

The number of inspections also fell sharply when the ratio of business receiving at least five inspections a year dropped from 11.9% in 2016 to 3% in 2020.

Most enterprises stated that there has been progress on administrative reform, but it still needs to be stepped up in some areas.

Simplified procedures and paperwork were acknowledged by 66.5% of enterprises, compared to 49.5% in 2016, while 76% of businesses felt time spent on implementing administrative procedures was less than formally required, up from 67% in 2017. 84% of firms said that public officials handled work effectively, a significant leap from 58% in 2016.

Besides the bright spots, 54% of enterprises said that bureaucracy remained. 57.4% of businesses stated that relations with public officials were necessary to access provincial documents, and 20% said public officials were not friendly in handling administrative procedures. The access to information such as maps, land use plans, public investment plans, budget documents, preferential policies for investors was rated to be difficult.

The PCI is arguably an action set of indexes that drives practical actions of local authorities, requiring them to periodically review their administrative apparatus in order to enhance the effectiveness in enterprise support policies.

The above-mentioned figures show that localities still have plenty of room for reform to increase the competitiveness and improve the business climate. Therefore, local authorities need to continue pushing through reform in order to truly become supporters for enterprises to stand firm and grow.