Local Government Capacity Assessment Indexes


Manage and implement the Trade Promotion Program, under which enterprises (including FDI enterprises) are supported for export-oriented trade promotion programs and in the domestic market.

- For export-oriented trade promotion

+ Support 50% of commercial information costs, up to 700,000 VND/enterprise;

+ Support 50% of export propaganda costs, maximum 25,000,000 VND/propaganda topic;

+ Support 50% of domestic and foreign expert costs to consult on product development, improve product quality, develop exports, and penetrate foreign markets;

+ Support 70% of costs for organizing and participating in fairs and exhibitions abroad, up to a maximum of 100,000,000 VND/enterprise;

+ Support 50% of the cost of organizing export-oriented exhibitions in the province, maximum 02 booths/enterprise;

+ Support 80% of the costs of propaganda, promotion and inviting customers to trade when organizing fairs and exhibitions, up to 30,000,000 VND/enterprise;

+ Support 70% of costs (1 person per enterprise) for trade promotion activities that have been implemented and are effective in expanding export markets, up to 50,000,000 VND/enterprise.

- For domestic trade promotion:

+ Support 50% of costs for organizing and participating in fairs and exhibitions with no more than 02 booths/01 enterprise;

+ Support 70% of the cost of investigation, survey, and domestic market research, not exceeding 700,000 VND/enterprise;

+ Support 50% of export propaganda costs, not exceeding 15,000,000 VND/propaganda topic;

+ Support 100% of training costs, short-term training on business skills, organizing retail networks; support participation in short-term specialized training courses


for businesses operating in specific industries; training in domestic market development skills for host units; cooperating with organizations and individuals to research and develop domestic market development programs.

The trade promotion support policy clearly demonstrates the local government’s interest in market expansion and customer search activities of businesses and investors. However, for large businesses and investors, this trade promotion funding support is quite modest compared to production and business costs.

3.2.4.9. Local government

a. Economic development policy

According to the Master Plan for Socio-Economic Development of Quang Nam Province to 2020, with a vision to 2030, Quang Nam Province aims to restructure its economy so that by 2020, the agriculture, forestry and fishery sector will account for only about 10% of production value and 38.0% of the labor force in the province, while the non-agricultural sector will account for about 90% of production value and 62% of the labor force. The province's development orientation to 2030 is to "strongly develop advanced technology, high-quality services, high-tech agriculture and a safe and sustainable environment". From there, the Provincial Government has identified breakthroughs in economic development policies in the coming time as follows:

- Focus on developing the province's advantageous dynamic industry clusters, ensuring competitiveness and sustainable economic growth associated with urban centers, especially in forming the eastern development poles of the province.

- Invest in a complete infrastructure network with full airport and seaport infrastructure; synchronize connections between industrial clusters, urban centers and raw material areas to move towards sustainable industrial development.

- Continue to build Chu Lai Open Economic Zone according to the model of a comprehensive economic zone, including industrial parks and export processing zones. Taking the open mechanism as a breakthrough idea throughout and considering adjustments to adapt to the global market.

- Promoting the potential value of cultural relics and scenic spots in the area


The province is working to develop tourism and services into a spearhead economic sector, through urban-rural linkages, linkages of tourism products in the Central Key Economic Zone and the whole country.

To implement the breakthroughs in this economic policy, Quang Nam province needs to mobilize resources from investors, especially foreign investors, to quickly access large capital sources, advanced technology and management. Therefore, in the past years and in the coming time, Quang Nam province will continue to have stronger policies and measures to attract foreign investment to realize the province's socio-economic development plan to 2020 and vision to 2030.

b. Direction and management activities

In recent years, the direction and management activities to create a transparent and convenient investment environment for enterprises have been the key tasks of all levels of government in Quang Nam province. Regarding institutions, the Provincial People's Committee issued Decision No. 3766/QD-UBND dated December 4, 2013 on the Regulations on coordination of the "one-stop shop" mechanism in handling investment procedures in the province and Decision No. 37/QD-UBND dated January 6, 2016 of the Quang Nam Provincial People's Committee on the Regulations on the order of implementing investment projects in Quang Nam province to specify the steps of handling administrative procedures for investors. Regarding organizational structure, the Provincial People's Committee has established public administrative centers in Tam Ky city, Hoi An city and Dien Ban town to better support businesses and people in administrative procedures. The efforts of the local government have been clearly reflected in the results of the Provincial Competitiveness Index published annually by the Vietnam Chamber of Commerce and Industry and the United States Agency for International Development (USAID) based on the results of a survey of the business community. In the past 3 years, Quang Nam province has always been one of the 10 provinces and cities with the highest Provincial Competitiveness Index among 63 provinces and cities nationwide.


Table 3.12. Indicators for assessing the capacity of local governments



2012

2013

2014

2015

2016

2017

Competitiveness

Provincial level (PCI)

Value

60.27

58.76

59.97

61.06

61.17

65.41

Ranking

15

27

14

8

10

7

Administrative reform

Provincial level (PAR Index)

Value

78.16

73.11

81.29

84.43

72.88

73.27

Ranking

29

52

35

38

32

52

Public administration and management efficiency

province (PAPI)

Value

37.51

37.80

36.40

36.53

35.99

37.08

Ranking

17

16

33

20

30

27

Ready for development and application of information and communication technology

(ICT Index)

Value

0.41

0.35

0.39

0.47

0.44

0.36


Ranking


35


42


45


25


30


40

Maybe you are interested!

Local Government Capacity Assessment Indexes

Source: Provincial Competitiveness Index 2017

Although highly appreciated by the business community in the provincial competitiveness index, Quang Nam province's ranking is only average in the indexes announced by organizations and state management agencies. Specifically, for the Provincial Administrative Reform Index (PAR Index) announced by the Ministry of Home Affairs, in the past 5 years, Quang Nam province has ranked above 30. Quang Nam province's ranking in the Provincial Governance and Public Administration Performance Index (PAPI) announced by the Vietnam Union of Science and Technology Associations and the United Nations Development Program (UNDP) also fluctuates mainly between 20 and 30. According to the assessment of the Ministry of Information and Communications, the readiness level for the development and application of information and communication technology of the Quang Nam provincial government also has many limitations.

c. Relations with the business community

To promptly grasp information and feedback from the business community and investors in the province, the Provincial People's Committee has established two communication channels: regular meetings with businesses on the 5th of every month according to Decision No. 2707/QD-UBND dated September 5, 2014 and an electronic information page with the domain name www.htdn.ipaquangnam.gov.vn according to Decision No. 1185/QD-UBND dated September 6, 2014.


4 years 2015. The maximum time limit for businesses to respond on the portal is 5 days for questions with only 1 responding agency and 7 days for questions with 2 or more responding agencies.

Table 3.13. Enterprises' assessment of resolving problems and difficulties in 2017

Enterprises receive feedback from provincial authorities after reporting

difficulties, obstacles (%)

Proportion

98

Order

6

Difficulties and obstacles of enterprises are promptly resolved through business dialogue (%)

Proportion

74

Ranking

12

Business satisfied with the response/solution of

Provincial government agency (%)

Proportion

82

Order

12

Source: Provincial Competitiveness Index 2017

The results of regular communication between the government and businesses and investors to resolve problems and difficulties arising in the process of doing business and investing in Quang Nam province are reflected in the results of the 2017 provincial competitiveness index survey (these indicators were added in 2017 to assess the dynamism of the provincial government). When asked about the response of the provincial government after reflecting on difficulties and problems, up to 98% of businesses received feedback and 74% said that their problems and difficulties were resolved through dialogue. The rate of businesses satisfied with the response and resolution of the provincial government is also quite high (82%). These statistics show that the communication channels of the provincial government with the business community have had a positive effect.

In addition to contacting and promptly resolving problems and difficulties of enterprises and investors, the Provincial People's Committee annually organizes training sessions to guide enterprises and investors in learning about laws, policies and project implementation after being granted investment certificates.

d. Dynamic and creative

The dynamism and creativity of local governments are reflected in their application.


flexible within the legal framework to create a favorable business and investment environment for enterprises and investors in the area. Quang Nam Provincial Government has studied the Government's preferential policies in various fields to systematize and promulgate a series of policies on investment incentives in the fields of industry (Decision No. 15/2015/QD-UBND dated June 4, 2015); agriculture (Decision No. 27/2016/QD-UBND dated December 8, 2016 and Decision No. 35/2012/QD-UBND dated December 21, 2012); support in labor training (Decision No. 09/2011/QD-UBND). The dynamism and creativity of local authorities are also reflected in solutions to newly arising problems, typically the solution of applying information technology to make land clearance activities transparent so that people can access them publicly, limiting negative situations in compensation work. With the software system for managing compensation and land clearance, people can directly look up information related to land area, compensation prices and respond to competent authorities with questions and complaints for timely resolution.

Table 3.14. Index of dynamism assessment of Quang Nam provincial government



2013

2014

2015

2016

2017

Value

6.14

4.78

5.13

5.55

6.63

Ranking

20

26

14

8

7

Source: Provincial Competitiveness Index The results of the provincial competitiveness survey over the years show that the dynamism of the Quang Nam provincial government is increasingly high. In 2014, Quang Nam province ranked 26th out of 63 provinces and cities nationwide in terms of government dynamism, but by 2015, it had made significant progress to 14th place and this index continued to increase in the next 2 years. In 2017, Quang Nam province reached 7th place nationwide -

The best performance of the provincial government's dynamism ever.

3.2.4.10. Other activities

a. Supporting industry

Currently, the supporting industry in Quang Nam province only develops well for the automobile mechanical industry. Chu Lai - Truong Automobile Mechanical Industrial Park


Hai is one of the country's auto gas centers with 8 factories producing spare parts, including a mechanical processing factory and each year 2-3 more factories producing components are put into operation to produce localized components. In addition to financial capacity, Truong Hai Auto Corporation also has the advantage of developing supporting industries, which is a fairly high localization rate of products for passenger cars (52%) and tourist cars (46%); the current localization rate of tourist cars is only 16.2% but the enterprise is cooperating with Hyundai (Korea) to increase it to 40% to meet the origin requirements to enjoy preferential tariffs when exporting to ASEAN countries. The second largest industry in Quang Nam after the auto mechanical industry is textiles and garments, which is currently mainly processing for foreign enterprises, and supporting industries are almost undeveloped.

The development of supporting industries in Quang Nam still faces difficulties due to the technological level of enterprises in the province. The research results of the scientific project "Evaluation of the technological level of 6 key industrial groups in Quang Nam" published by the Institute for Science and Technology Evaluation (Ministry of Science and Technology) show that the supporting industries of the 4 industries of automobile manufacturing, forest product processing, mechanical processing, textiles and footwear are ranked average.

– advanced and the remaining two industries are construction materials production and food production technology with only average technology level. The value of investment in production technology accounts for only 0.56% of GDP.

b. Public

Regarding the cooperation of the people in site clearance, opinions collected through interviews with leaders and experts of departments and branches show that most people have a cooperative attitude with the local government in site clearance when there is an investment project because it is an opportunity for people to have income (from compensation for site clearance, business opportunities), jobs and decent infrastructure for life. However, in the past, there were also some households that have not really cooperated with the local government and investors in site clearance such as the project to upgrade and expand DT 607 road, the main road connecting


Chu Lai - Truong Hai Automobile Mechanical Industrial Park to Tam Anh Industrial Park and land clearance projects in the Southeast region. When there was information about land clearance compensation, taking advantage of weaknesses in the current management of the local government, some households deliberately encroached on more land area, planted more trees, built more houses and other works with the purpose of receiving more compensation or after handing over the land for a while, they encroached again (Trinh Dung, 2017a, 2017b). Violations by a small number of people due to subjective or objective reasons are also factors that hinder project implementation and can discourage investors. As of May 10, 2018, Quang Nam province has only disbursed 960/3,579 billion VND for projects in the province, reaching 27% of the plan, 3% lower than the same period last year and the main reason is the congestion in site clearance.

Regarding the attitude of the people around the investment location, the general characteristics of Quang Nam people are friendly and hospitable, so in addition to the advantages of natural resources and culture, investors in the tourism and real estate sectors are quite impressed with the culture of the people. In the ancient town of Hoi An, the strong development of homestay tourism is one of the clear evidences of the friendliness and hospitality of the people. The positive characteristics of local culture will be an opportunity for Quang Nam province to attract many foreign investors not only in the tourism and urban sectors but also in other economic sectors such as industry and agriculture.

Regarding the attitude of the people in conflicts with investors, in recent times, the people of Quang Nam province have expressed their views and opposition to investors and investment projects that cause environmental pollution or negatively affect the lives of the people. Some typical incidents leading to the people's reactions are:

Some enterprises in Bac Chu Lai Industrial Park use stormwater drains to discharge waste, affecting the lives and agricultural production activities of people in Tho Khuong village, Tam Hiep commune, Nui Thanh district.

Heavy trucks running at high speed carrying soil and sand for construction projects

Comment


Agree Privacy Policy *