Vietnam needs to significantly increase the number of its private enterprises to catch up with global economic trends, experts emphasized at a forum on private sector development hosted by Nguoi Lao Dong (Laborer) newspaper on Thursday.

Dr. Can Van Luc, chief economist at BIDV, one of the four major state-owned banks in Vietnam, cited China as a comparison, noting the northern neighbor boasts 55 million businesses, while its population is only 15 times that of Vietnam.

“Vietnam’s goal of reaching one million enterprises is still too modest. We should aim for at least four million,” he said.

Ly Kim Chi, chairwoman of the Ho Chi Minh City Food and Foodstuff Association, pointed to the city's 400,000 household businesses, with over 20,000 operating effectively.

Chi argued that with proper support, many of these could transition into full-fledged enterprises, creating a powerful private-sector base for the city.

"These households have decades of experience, ensuring their resilience. However, they need specific incentives, not a one-size-fits-all policy," she added.

Chi emphasized the crucial role of policy in fostering private sector growth, calling for synchronized implementation that reflects the realities of business and life.

She pointed out that six industry associations recently petitioned Prime Minister Pham Minh Chinh to eliminate a burdensome administrative procedure, warning that if ministries continue to take a restrictive stance, it will block private sector growth.

Ly Kim Chi, chairwoman of the Ho Chi Minh City Food and Foodstuff Association, attends a forum on private sector development hosted by Nguoi Lao Dong (Laborer) newspaper on March 20, 2025. Photo: H.T

Prof. Vu Minh Khuong of the Lee Kuan Yew School of Public Policy, part of National University of Singapore, said Vietnam’s private sector could be the country’s strategic engine for global competitiveness. 

“If managed well, it can unlock tremendous growth potential,” he noted, but warned that institutional bottlenecks remain a major constraint.

Khuong recommended that Ho Chi Minh City send a task force to Singapore for a one-week study tour to learn from its governance model.

“If implemented effectively, 400,000 business households in Ho Chi Minh City could transition into formal businesses, leveraging incentives and growth opportunities.

“A few million U.S. dollars invested in learning from Singapore could yield billions in returns," he argued.

Assoc. Prof. Tran Dinh Thien, former chief of the Vietnam Institute of Economics, highlighted the dominance of FDI enterprises over the domestic private sector. 

"Private businesses are small, weak, and face numerous challenges. The number of businesses exiting the market exceeds those entering, despite this sector's crucial role in the economy," he stated.

Thien called for a candid assessment of the situation and a fundamental shift in approach.

He underlined the need of a bold transformation to build a new generation of Vietnamese businesses that can join global supply chains and drive innovation.

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