The three pillars of the economy

Never before have key issues aimed at promoting the development of the private economy been decided so decisively in such a short period of time as recently. On May 4, 2025, Resolution No. 68-NQ/TW of the Politburo on the development of the private economy was issued. At the end of the morning session on May 17, the National Assembly passed Resolution No. 198/2025/QH15 on some special mechanisms and policies for the development of the private economy.

On the morning of May 18th, a national conference was held to disseminate and implement Resolution No. 68-NQ/TW and Resolution No. 66-NQ/TW of the Politburo on reforming the work of lawmaking and enforcement to meet the requirements of national development in the new era.

Many have compared running a business to driving a car. Everyone wants their car to go as far and as fast as possible, but safety cannot be ignored. Very few dare to drive fast if they risk receiving a traffic fine the next day. In other words, entrepreneurs and businesses need smooth, wide roads, but they also need clear, transparent, and consistent "traffic laws." The aforementioned resolutions are not only words of encouragement, but also strong political commitments, institutionalized to protect the rights of entrepreneurs and businesses to the fullest extent; while ensuring fairness in accessing and using capital, land, resources, technology, human resources, data, etc.

Focusing on developing the private sector contributes to building an economy that is not only quantitatively developed but also qualitatively advanced – an economy where all sectors have a place, are respected, and their value is promoted in a close and harmonious linkage. In his speech at the conference to disseminate and implement the two resolutions on the morning of May 18, General Secretary To Lam emphasized a profound and evocative image, requiring the private sector to work alongside other economic sectors, "forming a solid 'three-legged stool' for an independent, self-reliant, and successfully integrated economy."

In reality, the separation between economic sectors remains one of the main reasons hindering development. While state-owned enterprises (SOEs) hold key sectors such as energy, telecommunications, and infrastructure; foreign direct investment (FDI) enterprises focus on manufacturing and export; private enterprises often play only a "supporting" role, rarely participating deeply in high value-added stages of the global supply chain.

For state-owned enterprises (SOEs), the subsidized mindset, excessive administrative intervention, and the "holding onto" of many sectors where the private sector could perform better have resulted in operational efficiency that is not commensurate with the invested resources. Complex and inflexible legal regulations also limit the innovation capacity of SOEs, leading to the paradox of "SOEs wanting to be like private enterprises, while private enterprises... want to be like SOEs," as one National Assembly representative once stated in parliament.

In other words, state-owned enterprises (SOEs) also need greater autonomy, reduced administrative constraints, and a focus on areas where the private sector cannot or does not want to participate. At the same time, models of cooperation between SOEs and private businesses need to be established soon. In 2021, Viettel collaborated with private businesses in its supply chain, from component manufacturing and software development to providing technical solutions, to develop its 5G network project. This is a prime example of the synergy of capabilities between different components.

Similarly, it is essential to encourage the development of cooperative relationships between FDI and private enterprises based on the principles of harmonizing interests, sharing responsibilities and risks; policies are needed to direct FDI flows into high-tech sectors, creating high added value and promoting linkages and technology transfer to domestic enterprises... To achieve this goal, it is necessary to change the investment incentive regime for FDI enterprises based on performance, attracting investment with clear and specific indicators and criteria, avoiding "one-size-fits-all" incentives.

The target of 8% GDP growth by 2025 and achieving double-digit growth in subsequent years requires extraordinary efforts from the entire political system, business community, and society as a whole. The recently issued resolutions have laid an important foundation, affirming the core driving role of the private sector. However, to turn this vision into reality, the key lies in building and leveraging the synergistic strength from the effective linkages between the three pillars: the state-owned economy, the private sector, and the FDI sector. The economy will develop more sustainably when all three pillars are strong, each in its rightful place, and all working towards the common goal of a prosperous nation and a thriving people's lives.

Dr. Nguyen Dinh Cung, former Director of the Central Institute for Economic Management Research

Source: https://www.sggp.org.vn/kieng-3-chan-trong-nen-kinh-te-post795981.html