Thursday, June 24, 2021, 13:47 (GMT+7)
The state economic sector’s role in the country’s socialist-oriented market economy is undeniable

The 35-year national renewal has proved that the state economic sector plays a leading role in the country’s economy. According to the Documents of the 13th National Party Congress, “the socialist-oriented market economy continues to develop, the macroeconomic stability has been maintained, the economy’s major balances have been ensured, the economic growth has been sustained at a rather high level, the economy’s scale and potential have been increased, and the quality of economic growth has been improved.” That is an undeniable fact.

In the name of “economic experts,” “successful businessmen,” and “legal representatives” of the business community and the people, exploiting weaknesses and shortcomings of a number of state enterprises in business and production, the hostile forces and political opportunists have enhanced their sabotage strategy against our Party and State’s economic renewal policy. Denying the state economic sector’s key role, negating the ownership of means of production, and distorting the nature of the socialist-oriented market economy in our country represent a central part in their strategy. They believe that the state economic sector’s key role will lead to the abolishment of competition and discrimination against other economic sectors, adding that the state economic sector’s performance of its leading role in the economy is vague and impractical, with a view to creating doubts and undermining the faith of cadres, party members, and citizens in the Party’s leadership over and the State’s management of the economy. However, the development of the state economic sector in the socialist-oriented market economy in the past 35 years of national renewal has proved the above-mentioned distortions groundless as follows.

First, the state economic sector’s performance of the crucial role in the socialist-oriented market economy has not brought out any elimination of competition. The socialist-oriented market economy in our country is a “modern and internationally integrated market economy operating fully and synchronously according to the market economy rules.” Its performance of the leading role will not negate the competition; on the contrary, it will promote a fair competition between economic sectors. The economic renewal and integration into the world will force our country to respect and fully follow the market economy rules. Up to now, Vietnam has signed and effectively realised 14 free trade agreements (FTA), including the high-standard ones, such as CPTPP and EVFTA. According to the World Economic Forum, Vietnam’s Global Competitiveness Index (GCI) in 2019 was ranked 67 amongst 137 economies. It has revealed that in spite of the state economic sector’s leading role, the competitiveness of our country’s socialist-oriented market economy has always been improved.

State-owned enterprises and groups operate mainly in the fields that private businesses do not want or can not operate. Besides, they act as a guide in the important fields of the economy, such as defence, security, energy, airport, seaport, and traffic infrastructure, while taking part in supplying public services but abiding by the market rules in an equal environment together with other businesses. According to our Party, state-owned enterprises must “operate under the market mechanism, adopt modern business administration under international standards, use the business and production efficiency as the main yardstick for assessment, and fairly compete with businesses from other economic sectors.” It proves that our Party and State do not have any preferential treatment policy for state-owned enterprises or discriminate any business from other economic sectors. State enterprises are autonomous in their production and business and subject to the regulation of the market economy rules and the socialist-oriented market economy in an equal, public, transparent competition with others. When equitising, renewing, and rearranging state-owned enterprises, the Government has divested from the fields that businesses from other economic sectors would achieve high efficiency of business and production, such as consumer product industry, services, tourism, and transport. In addition, it has “eradicated the mechanism of direct administrative intervention and subsidisation for state-owned enterprises and provided equal treatment for businesses from other economic sectors, particularly in access to state resources, credit, land, natural resources, investment, business, finance, and taxation,” while stepping up administrative reform and completing the market economy institution. Apparently, our Party and State have always created a favourable condition for a fair competition between all economic sectors and for their development. Moreover, the private sector has been developed in all fields that are not prohibited by law.

Things mentioned above have given an incentive to the development of non-state enterprises. As a result, 591,499 private businesses are operating effectively, accounting for 96.9% of the total number of enterprises across the country, while the figures relating to state-owned enterprises are 2,260 and 0.4% respectively. In the first quarter and April of 2021 alone, there were 44,166 newly-founded private businesses, 21,381 enterprises resumed their operation, 465 of them possessed the investment of over 100 billion VND, a 33.2% increase in comparison with the same period of 2020. The private economic sector has joined key parts of the economy, such as manufacturing, high technology, construction of highway, airport, and seaport, alternative energy, electricity transmission, and logistics, which has proved its role as one of the driving forces of the economy. Many private businesses and groups have obtained success in both domestic and global markets, such as Vingroup, Mobile World Joint Stock Company, Hoa Phat Group, Vietjet, VP Bank. That is an indisputable proof of our Party and State’s guidelines on creating a healthy, equal competitive environment within the socialist-oriented market economy.

Second, the state economic sector’s leading role has been increasingly promoted as a tool and material force for the State to maintain macro-economic stability, orient, regulate, and foster socio-economic development, and overcome shortcomings of the market economy. State-owned enterprises and groups take up the majority proportion or play a dominant role in some sectors and key parts of the economy.

When natural disasters, epidemics, and climate change negatively impacted on socio-economic development of all countries around the world, Vietnam’s average GPD growth rate in the period of 2016-2019 was rather high, at 6.8% per annum. It is worth noting that in 2020, thanks to the Government’s close, drastic direction and operation, our country’s growth rate reached 2.91%, amongst the world’s highest; Vietnam’s GDP was over 340 billion USD, equivalent to the per capita income of more than 3,500 USD. The socio-economic development indexes were maintained stably, such as exchange rate, foreign exchange market, and balance of payments (export surplus for 5 consecutive years. The rate of poor households under the multidimensional standards was decreased from nearly 10% in 2015 to 3% in 2020. Health insurance coverage was increased from 76% in 2015 to 90.7% of the population in 2020. Transport, energy, irrigation, urban, industrial, education, health, information and communication infrastructures have been completed and put into use, thereby increasing the economy’s competitiveness. The state economic sector serves as an important tool and material force to ensure defence, security, and social security as a solid foundation for Vietnam to successfully fulfil the dual goal of COVID-19 combat and socio-economic restoration and development.

Third, most of the state-owned enterprises and groups have proved their leading position in the efficiency of business and production, while promoting their function as a tool and material force for the Government to regulate the economy and effectively implement policies to maintain macro-economic stability, control inflation, and create revenues for the state budget, thus making significant contributions to socio-economic development, defence, security, and social security. According to statistics released by the Ministry of Planning and Investment in 2020, making up only 0.4% of businesses nationwide, state-owned enterprises mobilised and attracted 9.65 trillion VND for production and business, their revenue was 13.41 trillion VND as the highest number, and their profit before tax was 323,640 billion VND (equivalent to 24.8%, 56.7%, and 36.1% of the total figures by all enterprises respectively). Meanwhile, taking up 96% of businesses across the country, non-state enterprises attracted only 22.25 trillion VND for production and business, their revenue was 3.41 trillion VND, and their profit before tax was 190,360 billion VND (equivalent to 57.2%, 14.4%, and 21.3% respectively). While the monthly average income in state-owned enterprises was 12.56 million VND, that figure in non-state businesses was only 7.87 million VND. According to statistics issued by the Vietnam Report Joint Stock Company (VNR), amongst 10 biggest enterprises of Vietnam in 2020, there were 7 state-owned businesses.

Those above-mentioned facts clearly prove the key role of the state economic sector and help cement the people’s faith in the Party’s leadership and the State’s management over the development of a socialist-oriented market economy, arouse the aspirations of the entire Party, Military and people for developing a prosperous and happy country, and negate all distortions.




* - Artillery Officer College

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It is impossible to distort or deny the stature, meaning and value of the Victory Day, April 30, 1975
At 11:30 a.m. on April 30, 1975, the flag of the National Front for the Liberation of South Vietnam fluttered on the roof of the Independence Palace, marking a sacred moment for the Vietnamese people, gloriously ending the resistance war against the US for national salvation which lasted for 21 years (1954 - 1975). Since then, April 30 has become the official holiday of the Vietnamese people, named the Victory Day, or the Reunification Day