Sustainable growth driver for Ho Chi Minh City: Improving the business environment

There are many motivations for Ho Chi Minh City to grow by double digits, including one that we have been doing for a long time and can do better: improving the business environment.

Ho Chi Minh City needs to continue improving the business environment to create strong development momentum - Photo: HUU HANH

Improving the business environment has always been identified by our Party and State as a key task to unlock and effectively use resources, thereby promoting high and sustainable growth.

From political commitment to action: facing reality head on

The draft political report submitted to the 14th National Party Congress has set the average GDP growth target for the 2026 - 2030 period at over 10% per year. The 17th Ho Chi Minh City Party Committee Executive Committee set the target of average GRDP growth of 10 - 11% per year (2026 - 2030 period); the average social labor productivity growth rate is about 8% per year.

These goals are not only political determination, but also demonstrate the business community's expectations for a favorable, transparent, stable, safe and low-cost investment and business environment.

After merging with Binh Duong and Ba Ria - Vung Tau, Ho Chi Minh City has become the largest industrial, service, financial and seaport center in the country; a gathering place for capital, people, science and technology and innovation. Ho Chi Minh City (new) contributes about 23.6% of GDP, the highest compared to other provinces and cities.

However, in the recent decade (from 2016 to present), GRDP growth as well as the investment rate in GRDP of Ho Chi Minh City (new) has always been lower than the average growth of the whole country.

Meanwhile, in the 2026 - 2030 period, the city plans to set a growth target equivalent to the national average. Therefore, the city needs to accelerate and reform the business environment to create a breakthrough in business development, promote investment, thereby directly contributing to growth.

Ms. Nguyen Minh Thao - Institute of Economic and Financial Policy, Ministry of Finance - Photo: NGUYEN KHANH

Before the merger of the provinces, in terms of industry structure, Ho Chi Minh City (old) had dominant services; Binh Duong had processing and manufacturing industries; and Ba Ria - Vung Tau had mining and tourism. This structure shows the level of complementarity, optimizing the advantages of the localities, creating opportunities to promote combined strength.

After the merger, services accounted for the highest proportion (50.1%), including logistics, banking and finance services; followed by industry (34.2%).

Notably, sectors considered as new drivers for growth such as education, training, healthcare and especially professional services, science and technology have not received adequate investment; the contribution of these sectors to the city's GRDP is still low.

This can also be considered the reason why the city's growth in recent years has not made a breakthrough and is still lower than the national average.

In 2024, Ho Chi Minh City's digital transformation (new) will only rank 4th, after Hanoi, Hue, and Hai Phong; in which digital government will rank lower (11th).

On the other hand, the rate of online application processing in the city is still much lower than the national average. According to data searched on the National Digital Transformation Portal (measured from January 1, 2025 to April 30, 2025), the rate of online application processing in Binh Duong (old) reached 19%, Ho Chi Minh City (old) reached 14.5% and Ba Ria - Vung Tau (old) only reached 10.5%.

As the locality with the largest concentration of enterprises in the country, the need to carry out administrative procedures is high and diverse, accordingly, Ho Chi Minh City needs to be a pioneer and active in simplifying administrative procedures and implementing digital transformation. However, many opinions say that the city's administrative procedure reform and digital transformation have not yet met the requirements.

In addition, our Party and State have identified the establishment of the International Financial Center (IFC) as a breakthrough solution to exploit and mobilize global resources for development.

The establishment of IFC in Ho Chi Minh City will not only attract global investment capital but also create momentum for sustainable development of the economy in general and Ho Chi Minh City in particular. Therefore, the institutions and policies for the operation of IFCs need to demonstrate superiority, tend to be open, and ensure the principles of publicity and transparency...

7 things to do to improve the business environment

To realize the double-digit growth target, the city needs to focus on accelerating and making a breakthrough in the quality of the business environment towards creating convenience, safety, stability, and low costs for businesses, while at the same time encouraging creative ideas.

In particular, focusing on attracting investment in the service and industrial sectors associated with the application of science and technology and towards sustainable production and business. The groups of solutions that need to be prioritized include:

Firstly , reform is associated with the mindset of "taking people and businesses as the center", state agencies are always committed to accompanying people and businesses. The spirit of reform must be implemented synchronously among agencies and units; from policy design to implementation.

Second , the documents issued by the City must ensure consistency, stability, clarity, transparency, ease of understanding, consistency and ease of implementation. At the same time, the policy consultation process must be carried out publicly, substantively, multi-dimensionally and linked with accountability. This is an important approach to building trust among people and businesses.

Third , issue a specific, transparent, and clear coordination mechanism; ensure shortening of time, processes, and procedures between state management agencies in handling administrative procedures for people and businesses; respond quickly and promptly resolve problems arising in investment and business activities.

Fourth , closely follow the reform requirements set forth by the Politburo, the National Assembly, and the Government; strive to set goals higher than the general requirements of the whole country; at the same time, ensure serious, substantial, and urgent implementation of related solutions.

In which, cutting down and simplifying administrative procedures and applying technology in handling administrative procedures are the key and core reforms.

It is necessary to provide clear and easy-to-understand instructions on administrative procedures ; ensure the progress of administrative procedures is transparent and on time; establish a diverse, convenient and practical mechanism for dialogue, receiving problems and answering questions and recommendations from people and businesses.

Look at Ho Chi Minh City's digital transformation index to improve.

Fifth , develop extra-budgetary financial mechanisms for science, technology and innovation according to Resolution No. 57-NQ/TW of the Politburo to encourage enterprises to research, apply, develop and transfer technology. At the same time, promote and optimally exploit special and outstanding policies for the city to upgrade the level of development.

Sixth , actively and substantially participate in the process of drafting documents and policies related to the International Financial Center.

Seventh , create a favorable environment for the expansion and diversification of night-time economic activities, contributing to promoting the development of service industries.

Ho Chi Minh City has important economic strength and position in the country, so the city's business environment reform also needs to demonstrate superiority, creating a turning point in transforming the economic structure and growth model towards rapid and sustainable development.

Consider candid reviews

The number of enterprises in Ho Chi Minh City is about 328,000, accounting for 35% of the total number of enterprises nationwide. Both the number of enterprises and the density of enterprises in the city lead the country.

Ho Chi Minh City is the economic locomotive of the country, but has not yet created a breakthrough in growth based on productivity improvement, science and technology and innovation. The city has unique and outstanding mechanisms and policies to unleash resources and lead the economy; however, many opinions still believe that the city has not yet exploited and used these mechanisms and policies effectively, including attracting capital for science and technology.

There is a fairly straightforward assessment that Ho Chi Minh City can discuss further: After more than two years of applying Resolution 98/2023/QH15 to pilot a number of specific development mechanisms and policies for Ho Chi Minh City, the city has not yet attracted any strategic investors.

Back to topic

DR. NGUYEN MINH THAO (INSITATE FOR ECONOMIC AND FINANCIAL STRATEGY AND POLICY)

Source: https://tuoitre.vn/dong-luc-tang-truong-ben-vung-cho-tphcm-cai-thien-moi-truong-kinh-doanh-20251125154625014.htm