Resolution No. 24/2016/QH14 on the plan for restructuring the economy for the period 2016-2020

Time of signing: 05.12.2016 16:39:58 +07:00

OF THE NATIONAL ASSEMBLY

Resolution number: 24/2016/QH14

RESOLUTION

ON THE PLAN FOR RESTRUCTURING THE ECONOMY PERIOD 2016-2020

OF THE NATIONAL ASSEMBLY

SOCIALIST REPUBLIC OF VIET NAM

On the basis of the Constitution of the Socialist Republic of Vietnam;

On the basis of considering the Report No. 459/TTr-CP dated October 18, 2016 of the Government, the Report on Examination No. 137/BC-UBKT14 dated October 19, 2016 of the Economic Committee, reports from relevant agencies, and opinions submitted to the National Assembly;

RESOLUTION:

1. ON THE RESULTS OF RESTRUCTURING THE ECONOMY PERIOD 2011-2015

The National Assembly basically agrees with the assessment of the results of restructuring the economy during the period 2011-2015 as presented in the Government's report and considers that, alongside the achievements made, the implementation of the three key areas of economic restructuring has not met the set targets. Investment structure changes slowly, investment efficiency is low. State-owned enterprise restructuring progresses slowly, management and operational capacity of enterprises is weak. Business performance of state-owned enterprises is poor, some economic indicators heavily depend on foreign direct investment (FDI) enterprises and small and medium-sized enterprises which account for a large proportion but have not benefited sufficiently from support policies for development. Collective economy still faces difficulties. Restructuring of weak commercial banks is weak, handling bad debts remains challenging, and the results achieved are still low. Sectoral economic restructuring does not meet the requirements of international integration and response to climate change. Regional economic restructuring has not been given due attention, development space is still divided along administrative boundaries, there is a lack of mechanisms to link localities within regions and between regions; human resource development in terms of both scale and quality is not synchronized with economic restructuring.

The above weaknesses and limitations are mainly due to subjective reasons. In particular, the organization and implementation of policies on economic restructuring are passive, delayed, ineffective, and lack coordination among levels, sectors, and localities, partly due to local interests and term-of-office thinking. There has been no breakthrough in institutional reform, especially in institutions related to production factor markets, and institutional innovation has not been carried out comprehensively.

Some localities have not paid sufficient attention to implementing economic restructuring. The supervisory role of agencies, organizations, and citizens regarding economic restructuring has not been fully utilized.

2. ON THE PLAN FOR RESTRUCTURING THE ECONOMY PERIOD 2016-2020

1. Viewpoints on economic restructuring

The National Assembly agrees with the viewpoints on economic restructuring during the period 2016-2020 as presented by the Government and emphasizes:

• Adhering closely to the Party's guidelines and policies, particularly Resolution No. 05-NQ/TW dated November 1, 2016 of the Central Committee of the Communist Party of Vietnam (12th tenure), building a growth model based on efficiency, measured by labor productivity, quality, and competitiveness of the economy; mobilizing, allocating, and using resources effectively according to market signals and mechanisms. Emphasizing the improvement of growth quality, shifting gradually from a growth model primarily based on investment and exports to one based simultaneously on investment, exports, and the domestic market; shifting gradually from relying on increasing the quantity of production factors to relying on improving labor productivity, quality, application of science and technology, and innovation. Maximizing the exploitation and utilization of domestic resources while attracting and effectively utilizing external resources. Maintaining macroeconomic stability, linking economic growth with social development, achieving social progress and equity, ensuring national defense and security, maintaining ecological environment, applying science and technology, improving the quality of human resources, adjusting the labor structure in line with economic restructuring, and ensuring real improvements in people's living standards.

• Paying special attention to the implementation phase with specific measures and policies that can measure results, have strong and timely impacts according to market signals, viewing the development of the private sector as a crucial driving force for economic development. Reallocating state resources and other economic components according to market principles to high-efficiency industries, fields, and regions with spillover effects. Overcoming the mindset of paternalism, begging, and dependency; focusing on isolating and promptly addressing outstanding issues from previous periods of economic restructuring to avoid affecting other areas and socio-economic achievements.

• Implementing economic restructuring in conjunction with administrative reform, building an efficient and effective administrative apparatus, valuing talent; promoting administrative reform, enhancing the quality of public services.

• Organizing the implementation of free trade agreements (FTA) well and actively taking advantage of the benefits of international economic integration and the fourth industrial revolution.

• Ensuring the connection between economic growth and environmental protection and recovery under a green economy model, adapting to climate change.

2. Objectives for restructuring the economy

• Gradually reduce the budget deficit ratio of the state to below 3.5% of GDP by 2020.

The scale of public debt annually during the period from 2016 to 2020 shall not exceed 65% of GDP, government debt shall not exceed 54% of GDP, and foreign debt of the country shall not exceed 50% of GDP. Improve the quality of institutional management of public investment to reach the level of the four most developed ASEAN countries (ASEAN-4). The proportion of state investment should be around 31-34% of total social investment.

• Each year, 30-35% of businesses engage in innovation activities. The average annual growth rate of labor productivity should be over 5.5%, with productivity within industries contributing more than 60% to labor productivity in 2020. By 2020, the proportion of trained labor for three months or more with certificates should reach about 25%, and the proportion of agricultural labor should decrease below 40%.

• The contribution of Total Factor Productivity (TFP) to average annual growth

during the period from 2016 to 2020 should be approximately 30-35%. Narrow the gap in national competitiveness capabilities with ASEAN-4.

international disputes with ASEAN-4.

• By 2020, reduce the non-performing loan ratio of the credit organization system to below 3%. Strive to reduce the average domestic lending interest rate to be competitive compared to the average lending interest rate in the ASEAN-4 group. Enhance the scale and efficiency of the stock market, government bond market, and corporate bond market. By 2020, the size of the stock market capitalization should reach about 70% of GDP, and the bond market debt should reach 30% of GDP.

• Withdraw all state capital from enterprises in sectors where the state does not need to hold more than 50% of the capital, and withdraw state capital to the minimum level stipulated for sectors where the state restructures and adjusts its investment capital. By 2020, there should be at least one million enterprises; 15,000 effective agricultural cooperatives and cooperative unions.

require State ownership exceeding 50% of capital, divesting State capital to the minimum level prescribed in Clause I.

stipulates for industries where the State restructures and adjusts investment capital. By 2020, there should be at least one million enterprises; 15,000 effective agricultural cooperatives and cooperative unions.

3. Key tasks in economic restructuring f

   1. Focus on completing the restructuring of three key areas including public investment, state-owned enterprises, and credit organizations.

public investment, state-owned enterprises, and financial institutions

Effectively implement the medium-term public investment plan linked to the five-year financial plan from 2016 to 2020 and the borrowing and repayment plan. Improve the institutional management of public investment according to international practices, prioritizing the reform of project evaluation, assessment, and selection methods. Implement public investment restructuring linked to fiscal restructuring, state budget restructuring, and public debt restructuring.

link public investment with restructuring government finance, national budget, and public debt.

Continue to intensify the restructuring of state-owned enterprises, focusing on state-owned corporations and holding companies. Conduct substantive evaluations and accelerate shareholding reforms, divestment of state capital transparently and publicly according to market mechanisms; strengthen inspections, audits, and supervision to prevent loss of state capital and assets; improve the corporate governance model of state-owned enterprises; establish appropriate mechanisms to control sources of funds for mergers and acquisitions; state-owned enterprises undergoing shareholding reforms must list on the stock exchange within one year from the date of initial public offering; attract strategic investors with capacity. Develop and announce specific annual targets for divesting state capital in enterprises. Resolve decisively state-owned enterprises that are losing money and ineffective state-owned enterprise investment projects according to market principles and mechanisms; consider and implement bankruptcy of state-owned enterprises in accordance with the law on enterprise bankruptcy.

Complete the basic restructuring of credit organizations, accelerate the process of handling bad debts, and gradually apply Basel II standards at credit organizations. By 2020, commercial banks should have Basel II capital adequacy ratios, with at least 12-15 commercial banks successfully applying Basel II (standard method and above). Improve the legal system to support the restructuring of credit organizations and handling of bad debts; enhance the capacity of the Asset Management Company of Credit Organizations (VAMC) to buy and sell debts at market prices linked to collateral asset disposal, protect the legitimate rights and interests of creditors, and allocate appropriate resources to handle bad debts quickly and decisively. Address and eliminate cross-investment and cross-ownership situations; accelerate the divestment of non-core business investments by commercial banks.

Complete the restructuring of the three key areas before 2019 to focus resources on restructuring other sectors.

2. Restructuring the state budget and the public sector

Vigorously restructure revenue and expenditure of the state budget, ensuring the safety of public debt and national finance. Implement the State Budget Law, laws on taxes, fees, and charges. Practice thrift in spending within the capacity of the economy. Strengthen management and efficient use of borrowed capital, only borrow within the ability to repay; strictly control local government and state-owned enterprise borrowing. Strictly enforce discipline and rules on revenue and expenditure of the state budget at all levels, sectors, regions, and units. Improve the legal system for financial management, asset management, investment management, and state capital management.

national finance. Implement the Law on State Budget, laws on taxes, fees, and charges. Practice thrift in expenditures within the capacity of the economy. Increase

management and efficient use of borrowed funds, borrowing only within repayment capacity; monitor

strictly local government borrowing, state-owned enterprises. Strictly enforce revenue and expenditure discipline in the state budget at all levels, sectors, regions, and units. Improve the legal system for financial management, assets, investment management, and state capital.

economic management, including reforming the State's management methods over the economy towards building a State that manages and serves, implementing comprehensive administrative governance.

streamline staffing, civil service reform linked to salary reform. Continue to strongly reform administrative procedures, significantly improving the quality of the business environment. Reform fundamentally the methods of management and the attitude of civil servants towards serving alongside managing; transparency in State management, strengthening discipline among civil servants and officials, and strict rules for state agencies. Severely handle cases of non-compliance and violations of laws and professional ethics.

responsibility reporting and community responsibility, continue to reorganize and restructure public service units, implement accounting; ¹

Reform the approach, enhance the capacity, effectiveness, and efficiency of state management in the economy, particularly reforming the state's management approach towards building a state that manages and serves, implementing comprehensive electronic governance. Carry out mergers and dissolutions of ineffective units and organizational structures; streamline staffing and reform the state apparatus in conjunction with salary reform. Continue to strongly reform administrative procedures, significantly improving the quality of the business environment. Fundamentally reform the way of managing and the attitude of civil servants, combining service with management; make state management transparent, strengthen discipline and rules for civil servants and state agencies. Severely deal with cases of non-compliance and violations of laws and professional ethics.

like businesses for public service units meeting conditions; differentiate public service units meeting conditions, except hospitals and schools;

On the basis of strengthening accountability and community responsibility, continue to reorganize and restructure public service units, accounting like enterprises for public service units meeting conditions; differentiate public service units meeting conditions, except hospitals and schools.

from supporting service providers to direct support for beneficiaries. Encourage various economic sectors to participate in developing and providing public services; establish a public service market regulated and adjusted by the State. Complete models and create clear legal frameworks for public service organizations to operate under market mechanisms, gradually reducing State subsidies, increasing autonomy in funding.

attract selectively foreign investment projects

related to State management and institutional risks in the business sector.

policies to support the development of small and medium-sized enterprises. Vigorously implement public-private partnership projects with monitoring mechanisms.

Modernize planning work, industry structure, and regional economy

international economic integration

dissolve public service units that operate inefficiently. Accurately and fully incorporate reasonable costs into the prices of essential public services, adjust the prices of various types of public services according to market mechanisms; establish a roadmap for implementing market prices for education and healthcare... linked with support for policy beneficiaries and the poor; shift

from the allocation mechanism to ordering services, from allocating funds based on inputs to those based on output quantity and quality, from supporting service providers to directly supporting beneficiaries. Encourage various economic sectors to participate in developing and providing public services; establish a public service market under state management and regulation. Improve models and create clear legal frameworks for public service units to operate under market mechanisms, gradually reducing state subsidies and increasing financial autonomy. 1

engines, special administrative-economic zones to play a leading role, promoting socio-economic development. Study, review, adjust functions and tasks

develop smart cities.

3. Vigorously develop the domestic private economy and reasonably attract foreign direct investment

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Promote the formation and development of strong private business groups with modern technology as the core and spearhead for economic development, alongside the growth of small and medium-sized enterprises domestically, enhancing competitiveness against foreign businesses. Selectively attract foreign investment projects, focusing on large multinational companies to effectively spread benefits to the domestic economic sector and link with environmental protection. Build a transparent, fair, equal, and favorable competitive environment, reducing costs related to state management and institutional risks for the business sector, especially domestic private enterprises. Promote the integration between domestic enterprises and the foreign-invested sector. Develop policies and mechanisms to support the development of small and medium-sized enterprises. Vigorously implement investment projects through public-private partnerships, with monitoring, management, and efficient use of investment capital for each project. 1

compete with foreign enterprises. Selectively attract investment projects

Modernize planning work, industry structure, and regional economic zones towards improving productivity, quality, and efficiency, linked with accelerating international economic integration. 1

Complete the legal system for planning and managing development in a coordinated manner, addressing fragmented and local management issues; study and build superior systems for dynamic economic regions, special administrative-economic zones to play a leading role in promoting socio-economic development. Review, adjust functions and tasks of local authorities and form a regional economic development coordination system. Localities cooperate in issuing and implementing investment attraction policies, prioritizing industries and fields with competitive advantages. Improve urban economic development models, organizational structures, functions, tasks, and management methods of urban governments; prioritize the development of smart cities. 1

related to State management and institutional risks in the business

Reorganize the agricultural sector strongly, linking with effective new rural construction, improving quality, added value, adapting to climate change, particularly crop and livestock changes in areas significantly affected by climate change; adjust land area suitable for new agricultural models. councillORS

Continue to innovate and expand effective production models, develop production and consumption cooperation and linkage forms along value chains, connecting with domestic and international sales systems. Improve cooperative models according to the Law on Cooperatives, with strong policies to attract enterprise investment in agriculture and rural areas; apply science and technology in production. Vigorously implement programs to build Vietnamese agricultural and seafood brands. i

mechanisms and policies to support the development of small and medium-sized enterprises. Vigorously implement I

public-private partnership projects with monitoring mechanisms.

Substantially restructure the industrial sector, develop deep processing industries for agriculture, forestry, and fisheries, manufacturing industries; significantly increase internal productivity, technological content, and domestic value-added in products. Focus on key industries with competitive advantages and strategic significance for rapid and sustainable growth, linked with environmental protection. Emphasize the development of component and cluster component production industries, promote some products' deeper involvement in global production and value chains. Create conditions for enterprises to propose investment projects serving restructuring goals.

4. Modernize planning work, industry structure, and regional economic

Implement restructuring in service sectors, maintaining higher growth rates than GDP. Focus on developing service sectors with advantages, high knowledge and technology content. Coordinate and leverage the comprehensive strength of ministries and sectors to implement national tourism development programs, aiming for tourism to become a key economic sector by 2020; improve professionalism and service quality; encourage enterprises to invest in tourism, focusing on forest, sea, and island tourism.

international economic integration

Improve environmental policies and enforcement capacity; fundamentally address pollution, particularly in key areas; monitor and respond to cross-border pollution issues, effectively cope with climate change.

engines, special administrative-economic zones to play a leading role, promoting socio-economic development. Study, review, adjust functions and tasks

Establish a National Program for implementing new-generation FTAs; set mandatory requirements and tasks for each economic sector; prepare for integration and promote domestic economic reforms.

Develop a synchronized range of markets including financial markets, land use rights markets, labor markets, and science and technology markets.

Complete the restructuring and develop a stable, healthy, and balanced financial market strategy between money and capital markets to reduce pressure on credit supply from the banking system; between stock and bond markets; between government and corporate bonds to meet long-term economic funding needs; between lending services and non-lending banking services, develop venture capital markets.

develop some smart cities.

Restructure the agriculture industry intensively, linked with effectively building new rural areas, enhancing quality, value-added, adapting to climate change, especially crop and livestock changes in areas heavily affected by climate change; adjust land area suitable for new agricultural models.

Continuously innovate and expand effective production models,

develop forms of production cooperation and linkage, selling agricultural products along value chains, connecting with domestic and international sales systems. Complete models and develop new cooperative models according to the Cooperative Law, with strong policies to attract enterprises to invest in agriculture and rural areas; apply science and technology to production.

Promote the implementation of programs to build brands for Vietnamese agricultural and aquatic products.

Restructure the industrial sector substantially, develop deep processing industries for agriculture, forestry, and fisheries, manufacturing industries; significantly increase internal productivity, enhance technological content and the share of domestic value in products. Focus on key industries with competitive advantages and strategic significance for rapid and sustainable growth tied to environmental protection.

Emphasize the development of component and cluster component manufacturing industries,

promote certain products to effectively participate in global production networks and value chains, distribution. Create conditions for enterprises to propose investment projects

serve the goal of restructuring the economy.

Implement the restructuring of service industries, maintain higher growth rates for service sectors than GDP. Focus on developing service sectors with advantages, high knowledge and technology content.

Coordinate and leverage the combined strength of ministries and sectors, implement the national tourism development program, by 2020 tourism should basically become a key economic sector; improve professionalism and service quality; encourage enterprises to invest in tourism, focusing on forest, sea, and island tourism.

Complete the restructuring and develop a stable, healthy, and balanced strategy for the financial market between the money market and the capital market.

Improve environmental policies and enforcement capabilities; fundamentally address environmental pollution, particularly in key areas; monitor and respond to cross-border pollution issues, effectively addressing climate change.

Establish a National Program on implementing new-generation FTAs; therein set out mandatory requirements for each economic sector; prepare adequately for integration and promote domestic economic reforms.

Develop a coordinated range of markets, including financial markets, land use rights markets, labor markets, and science and technology markets.

Complete the restructuring and develop a stable, healthy, and balanced strategy for the financial market between the money market and the capital market.

develop the national tourism industry so that by 2020, tourism becomes a key economic sector; improve professionalism and service quality in tourism; encourage businesses to invest in developing tourism, with a focus on forest, sea, and island tourism;

mũi nhọn; nâng cao tính chuyên nghiệp, chất lượng dịch vụ du lịch; khuyến Ị

khích các doanh nghiệp đầu tư phát triển du lịch, chú trọng phát triển du lịch rừng, biển, đảo.

perfect policies and enhance enforcement capacity regarding environmental laws; address environmental pollution fundamentally, paying particular attention to key areas; monitor and respond to cross-border pollution issues, effectively addressing climate change;

trường; khắc phục cơ bản tình trạng ô nhiễm môi trường, đặc biệt quan tâm đến các khu vực trọng điểm; giám sát và đối phó các vấn đề ô nhiễm xuyên biên ■

giới, ứng phó hiệu quả với biến đổi khí hậu. ị

I

establish the National Program for Implementing New Generation Free Trade Agreements; set out mandatory requirements and tasks for each economic sector; prepare for integration and promote domestic economic reform;

đó đưa ra các yêu cầu, nhiệm vụ bắt buộc cho từng ngành kinh tế; chuẩn bị sẵn 1

sàng cho hội nhập và thúc đẩy cải cách kinh tế trong nước. ị

5. develop various types of markets, including financial markets, land use rights markets, labor markets, and science and technology markets;

complete the restructuring and build a stable, healthy, and balanced development strategy for the financial market between the money market and the capital market;

to reduce the pressure on capital supply from the credit organization system; between the stock market and the bond market; between government bonds and corporate bonds to meet the demand for medium- and long-term capital mobilization of the economy; between lending services and non-lending banking services, develop the investment risk market:

Risks, the derivatives securities market, and consumer credit. Reorganize the management structure of the monetary market and the securities market to meet new development requirements. Pay attention to protecting users of financial services.

Summarize the effectiveness of models in practice, draw lessons on land accumulation, concentration, attracting enterprises to invest in agriculture, developing new cooperative models to build mechanisms and policies that are appropriate. Encourage and create conditions for land accumulation in agriculture; establish a legal framework for primary and secondary land use rights markets, especially agricultural land. I

Significantly improve the quality of higher education and vocational education. Focus

on developing and expanding vocational education channels to meet employment needs; prioritize training human resources in engineering and technology fields; reform training programs to increase practical content and strengthen ties with businesses, meeting market demands. Reform the vocational education system towards enhancing autonomy and applying competitive principles; by 2020, have approximately 40 high-quality vocational schools recognized by ASEAN-4 countries or internationally.

Develop measures to increase the value of transactions in the science and technology market annually; the number of patent applications for protection during the period from 2016 to 2020 should be twice as high as during the period from 2011 to 2015, particularly increasing the number of patents generated from national key science and technology programs.

apply the principle of competition; by 2020, there will be approximately 40 high-quality vocational schools with the capacity to train programs recognized by ASEAN-4 countries or internationally.

There are measures to increase the transaction value of the science and technology market

annually, the number of patent applications for protection during the period 2016-2020 was twice as high ¹

compared to the period 2011-2015, with a rapid increase in the number of patents created from national key science and technology programs.

III. ORGANIZATION AND IMPLEMENTATION

1. The Government directs the implementation of the economic restructuring process for the period 2016-2020; based on the Resolution of the National Assembly, develop an Action Program, completed before April 2017. Annually report on the results of implementation and include it in the annual socio-economic development plan assessment, ensuring budget allocation and balance within the five-year financial plan 2016-2020, medium-term public investment plan.

budget allocated and balanced in the Financial Plan for the 2016-2020 period, K e

investment plan for the medium term. ị

Review and propose the establishment of new laws or amendments to existing laws to serve the economic restructuring process; report at the third session of the 14th National Assembly. Promptly develop and approve important projects no later than the fourth quarter of 2017 and implement them from the beginning of 2018. Reform the management of economic restructuring, establish regular monitoring and evaluation mechanisms for economic restructuring tasks of ministries, sectors, and localities; enhance capacity and discipline in implementing economic restructuring.

implemented to serve the process of economic restructuring; reported at the third session of the XIVth National Assembly. *

Soon build and pass important projects at the latest by the fourth quarter

of 2017 and implement them immediately from the beginning of 2018. Reform the management of economic restructuring, have mechanisms for regular monitoring and evaluating the tasks of economic restructuring of ministries, sectors, and localities; enhance capacity and discipline in implementing economic restructuring.

Strengthen propaganda efforts, encourage the private sector and foreign-invested economic sectors to actively participate in the economic restructuring process; state-owned economic sectors proactively carry out restructuring tasks according to the set requirements.

2. The Standing Committee of the National Assembly, the National Ethnic Council, the Committees of the National Assembly, the Delegations of the National Assembly, and National Assembly deputies supervise the implementation of this Resolution.

3. The Supreme People's Court, the Supreme People's Procuracy, and the State Audit Office organize the effective implementation of the National Assembly's Resolution according to their assigned functions and tasks.

4. The Central Committee of the Vietnam Fatherland Front, members of the Front supervise and mobilize all strata of the people to implement the National Assembly's Resolution.

This Resolution was adopted by the 14th National Assembly of the Socialist Republic of Vietnam at its second session on November 8, 2016.