Promoting Vietnamese entrepreneurial spirit in economic recovery and development

Thursday, 10/11/2022 12:52
(CPV) - The Party and State of Vietnam have always consistently advocated "not criminalising civil and economic relations", and have always supported and encouraged enterprises to generate their revenues and profits in an ethical manner. This principle has many notable implications, contributing to stabilising market sentiments and promoting sustainable business development.

Economic concerns in a post-pandemic world

The COVID-19 pandemic has rocked economies around the world, including Vietnam, and has had many consequences for the world’s business sectors. Some of the consequences of the pandemic are stagnated production, contracts being terminated, commitments being violated and some figures are facing the risk of being prosecuted for criminal liability. These issues are not unique to only one country. However, they are gradually being alleviated.

Supporting Vietnamese entrepreneurs and enterprises to develop steadily and effectively

According to Lawyer Tran Manh Thang (HCMC Bar Association), the sectors that have been the most affected by the pandemic in Vietnam are: travel tourism, joint ventures in construction works, real estate projects and distribution chains of non-essential goods. “The COVID-19 pandemic caused many lawsuits. In particular, the fields of construction and real estate are heavily linked to each other. The simpliest is joint venture cooperation between contractors: main contractors, subcontractors, and member contractors in the joint venture cannot cooperate and support each other. The number of workers in  various service industries, such as travel tourism, has  significantly decreased. Employees have lost their jobs and have even sued their employers," Thang said.

The same situation happens for credit activities. Borrowers who are unable to repay their debts and fail to repay on time have to reverse their debts or use sub-capital source at a high interest rates to maintain their business. Therefore, disputes are inevitable. In 2021, the number of cases handled by the court is high, of which 80% are related to civil, commercial business, and labour.

Since then, the fear of criminalising economic relations has also increased. Nguyen Chi Hieu, a legal expert, has emphasised that the pandemic may be over, but its consequences in all aspects, including the need of taking legal actions, have to be anticipated to ensure that Vietnamese economic institutions are protected, as well as  individuals, enterprises, and entrepreneurs. With an increase in the number of entrepreneurs who may be infringing on the law, the aforementioned legal actions would lead to the insecurity of the market economy institution.

“The government needs to understand, share, listen and will continue to have solutions to support entrepreneurs to overcome difficulties and reach further,” said entrepreneur Cao Nguyet Thu, director of a business in the construction industry (HCMC).

Vietnam currently has nearly 900,000 operating enterprises, about 14,400 cooperatives and more than 5 million business households. The private business sector contributes over 60% of GDP and about 30% of the total number of employees working. Speaking at the recent Celebration of Vietnam Entrepreneur Day and Honouring outstanding Vietnamese Entrepreneurs 2022, Prime Minister Pham Minh Chinh commended the entrepreneur team for the results of the country's socio-economic recovery and development during a time when Vietnam and the rest of the world faces significant challenges. He also affirmed that the Government will work with ministries and localities across Vietnam to work towards achieving 12 objectives, among the others, including but not limited to strengthening investor confidence in the bond, securities, currency and real estate markets and make such markets healthier. The extremely clear message of the Party and the State is not to criminalise civil relations.

Supporting Vietnamese entrepreneurs and enterprises to develop steadily and effectively

When the whole country struggled against the COVID-19 pandemic, economic growth was sometimes negative, vaccines could not be accessed, and the pandemic had to be fought by administrative measures. In those difficult times, the Party and State have always had the support of the people, including entrepreneurs.  Enterprises and entrepreneurs have contributed nearly 10,000 billion VND to the vaccine fund. During these difficult times, the responsibility of enterprises and entrepreneurs is clearly demonstrated.

The non-criminalisation of civil and economic relations is also a measure to protect civil and economic transactions, in order to be public and transparent, and to make the business environment healthy for enterprises. 

Therefore, the non-criminalisation of civil and economic relations also contributes to stabilising the confidence of the individuals and of businesses in Vietnam, increasing market liquidity, and thereby helping enterprises to safely mobilise their capital to develop and create more jobs. Criminalisation is a phenomenon that society and the business community are very concerned about as it exhibits  an intervention by judicial authorities in the normal activities of civil and economic transactions. The subjects of these negative acts are agencies and individuals who conduct the necessary legal proceedings. Many cases demonstrate the results of criminalisation on individuals and businesses across Vietnam, such as the case of Hello cafe in Binh Chanh City, Ho Chi Minh City; the prosecution of the inheritance dispute at Nam A Bank; the case of seafoods family in Bac Lieu. The criminalisation has actually raised concerns among the citizens and enterprises about the discipline of the country and the justice of the law.

Lawyer Tran Manh Thang (HCMC Bar Association) said that economic relationships often reflect the market-based economy, is regulated by the market; therefore if an economic dispute shows signs of civil violations, it should be resolved by a court or by arbitration, instead of concentrating on criminal proceedings. A recent example to be taken is the People's Court of Ba Ria- Vung Tau province which agreed to the proposal of the Supreme People's Procuracy of Vietnam to exempt the entrepreneurs including Tran Quy Duong, Ngo Thi Minh Phuong, Do Thuy Linh as the heads of An Khang Real Estate Investment Joint Stock Company in Vung Tau from the criminal responsibility since the consequent economic losses no longer exist.  "It is great when various entrepreneurs and enterprises have been relieved of difficulties, and protected from facing the risk of criminalising the civil and economic relations in the context that the world’s economy is also struggling after the pandemic," Thang commented.

In order for society to develop, and for businesses to stabilise, recently the procurement sector has also issued many written notices to whole sectors to be careful in considering how to handle  cases in economic, administrative and civil relations. In the event of any mistakes, it is priorised to have the parties negotiate. Only when the negotiation is not successful, will other resolution methods be considered.

The Supreme People's Court has also published more than 500,000 judgments on the portal for all people and enterprises to access as reference materials. Notably, this includes Law on Conciliation, passed by the National Assembly,  which prioritises the settlement of social, civil and commercial disputes in a manner that is beneficial to all parties involved. Therefore, enterprises and entrepreneurs are able to  use this new mechanism as a guide to resolve disputes and disagreements in business activities./.

Luu Ly