1 Supports to an Enabling Environment for SMEs in Vietnam GTZ SME Promotion Programme Presentation at the Private Sector Development Network Phuket, May 2005 Le Duy Binh GTZ SME Promotion Programme

SME DEVELOPMENT PROGRAMME 2 Approach of the study Focus on legal constraints affecting the development of the BDS market Conducted in cooperation with CIEM (policy think tank), Vision (consultancy company) and VCCI (Chamber of Commerce) Covering 7 services in the first phase and 3 services in the second phase Findings on Legal Constraints on Services Report on LOE Implementation Directive by the Prime Minister Imple- mentation & follow -up Dev’t of BDS legal env’t under the old Project has been a good start to initiate supports at policy level…

SME DEVELOPMENT PROGRAMME 3 Action by Ministry of Science/ NOIP: Decision No.885/PCQL was issued in June 04, opening up further the IP service market, allowing law firms to join conditionally Directive by PM: “….Ministry of Science & Env’t shall replace IP representative certificate requirement with business conditions or lower the entry requirement…” An Example of Success: Enabling Environment for BDS in Intellectual Property Services LOE Implementation Report recommends: “…Number of IP Representative certificates required should be reduced or replaced with business conditions” BDS Legal Env’t Report: “…IP service providers must have min. 2 members with IP agent certificates (very difficult to obtain)…”

SME DEVELOPMENT PROGRAMME 4 Unified Enterprise Law and Law and Common Investment Law On that basis, new initiatives for a better business environment have been initiated in preparation for the new Programme Implementation of Reforms in Provinces Study “From Biz Idea to Reality” w/t Improved and more effective promotional mechanisms Policy making mechanisms, policy proposal, improved regulations, E.g. RIA with Assessment of the Enterprise Law Dialogue mechanisms E.g. Consultation W/S with Awareness for Reforms, e..g with

SME DEVELOPMENT PROGRAMME 5 RIA was one of them and has brought about some visible results 1.The second draft reports are now available and initial findings have been shared with the different stakeholders; 2.Strong interests in the public about RIA. It is being discussed widely by law makers, lawyers, economists, the press that they should be come part of the law-making process 3.MOJ is very interested in making RIA part of the law-making process. Initial discussions to realize this is being discussed. 4.Second RIA at a smaller scale is being planned, possibly with MOT under the a PPP agreement b/w Metro, MOT and GTZ

SME DEVELOPMENT PROGRAMME 6 Consultation on the UEL was implemented with Strong Participation from the Press Objective: A Good UEL Inputs from the Proj.

SME DEVELOPMENT PROGRAMME 7 A Website Dedicated to SME Policy was Developed Now the only website dedicated to providing info about SME policies in English. Now the only website dedicated to providing info about SME policies in English. A tool for knowledge management, particularly in the field of SME policies; A tool for knowledge management, particularly in the field of SME policies; New feature: public consultation on key legal documents related to SMEs New feature: public consultation on key legal documents related to SMEs

SME DEVELOPMENT PROGRAMME 8 Some Initial Results Achieved… Study to Review the Enterprise Law 1999 strongly used by the UEL Drafting Committee; no less than 25 proposals and issues identified the report have been addressed in the Draft 1 and 2 of the UEL; Study to Review the Enterprise Law 1999 strongly used by the UEL Drafting Committee; no less than 25 proposals and issues identified the report have been addressed in the Draft 1 and 2 of the UEL; Project-supported reports, workshops related to UEL help to raise the awareness for further reforms introduced by the UEL; Project-supported reports, workshops related to UEL help to raise the awareness for further reforms introduced by the UEL; With inputs from the Project, more than 40 articles on the UEL and the reforms introduced by the Law have been published in leading newspaper, magazine, radio and TV in English and Vietnamese; With inputs from the Project, more than 40 articles on the UEL and the reforms introduced by the Law have been published in leading newspaper, magazine, radio and TV in English and Vietnamese; RIA has been repeatedly discussed among local policy makers; policy advocacy and policy making bodies start to recognize RIA as a best practice which should become mandatory in law-making in Vietnam. RIA has been repeatedly discussed among local policy makers; policy advocacy and policy making bodies start to recognize RIA as a best practice which should become mandatory in law-making in Vietnam. Legal consultation has become of higher quality with follow-up activity. European investors in Vietnam, through EuroCham, made a 40 pages comment in writing on the First Draft of the UEL and these comments are being perused by the Drafting Committee. Many comments have been reflected in the second draft of the law. Legal consultation has become of higher quality with follow-up activity. European investors in Vietnam, through EuroCham, made a 40 pages comment in writing on the First Draft of the UEL and these comments are being perused by the Drafting Committee. Many comments have been reflected in the second draft of the law.

9 And A Partner Network is being Shaped in Preparation for Future Interventions in the Field of SME Policy and Future Supports to SME Policy/ Biz Env’t in Vietnam Business Associations Other Donors Projects Provincial Authorities Mass Media M O J

SME DEVELOPMENT PROGRAMME 10 National SME Action Prgm.& Promotional Prgm. Policy dialogue Introduction of innovative law making mechanisms and methods (e.g. RIA) in Vietnam NBIN in some selected provinces Monitoring and implementation of reforms insome selected provinces The Action Plan is used by MPI and others as guide for implementation Policy dialogues are effectively conducted on relevant reform projects DPI and other stakeholders use advice and technical assistance from GTZ to set up NBIN in some selected provinces Best practices & lessons learnt disseminate d in other prov. and national level Prgms. & Policies by other Ministries are more SME friendly and consistent with the Action Plan Policy dialogues more result oriented and of better quality Enterprise Law, Investment Law and other reforms are of better quality Biz. Registration faster, less costly & good information on biz. are available More effective implementation of policies, instruments and reforms in provinces Decision makers applied innovative law making mechanism like RIA in the process of drafting business laws (esp. UEL, CIL) Tools/ manuals for innovative law making mechanisms (e.g. RIA) developed and used in drafting other laws Economic Reforms in some selected provinces are effectively Implement ed Results of the dialogues used by different stakeholde rs in relevant reform projects Guideline &best practices on policy dialogue deve- loped and used Key areas of further cooperation in SME Policy and Enabling Business Env’t have been identified…