The Role of the Private Economy in the Integration Process

Economic integration is an inevitable and urgent requirement of our country. Clearly recognizing the advantages and challenges to proactively integrate is extremely necessary. Only then can we accelerate the integration process on a larger scale and at a higher level.

It can be said that, in fact, Vietnam's economy has been integrated into the world economy for a long time, but still at a low level. In response to the requirements of industrialization and modernization of the country, in response to the requirements of socialist-oriented economic development, we cannot help but accelerate the speed and scale of international economic integration. Therefore, the Resolutions of the 8th, 9th and 10th Party Congresses all affirmed that it is necessary to "accelerate the process of regional and world economic integration" on a larger scale and at a higher level.

Only with effective international economic integration can we create a new position in the international market, limit unfair treatment, and only with international economic integration can we take advantage of capital, techniques, and advanced technology to meet the requirements of industrialization and modernization of the country.

Only with international economic integration can we expand our import-export market, creating favorable conditions for product consumption. Integration is therefore not only for our businesses to reach out to the world market, but also for foreign businesses to enter production and business in our country. Obviously, international economic integration is an endogenous need of our country's economy itself, not because we are oppressed or forced. The opportunity is coming, our own requirements require it. The problem is how do we choose to still integrate and develop while still preserving complete independence and autonomy, still integrate without losing tradition, integrate while ensuring social security and order, integrate according to the motto "integrate but not dissolve". We have many advantages to enter integration. We have advantages in human resources, in labor with intelligence, agility, diligence and hard work. Our country is located in a strategic position on the regional and world economic development map.

Located in the central region of the Pacific Ocean, where international maritime transport flows converge, where the trade flows of Europe-Asia, America-Asia, Africa-Asia intersect. On the other hand, our country's resources are very diverse, rich and have large reserves. Therefore, in general, if we can outline a reasonable integration roadmap and organize the implementation of that roadmap well, the above advantages will inevitably be maximized, creating competitiveness in the new situation, creating a solid position in the international market.

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2. The role of the private economy in the integration process

Firstly , the private economy creates a huge amount of material wealth, contributing significantly to the income value of the entire national economy. It should also be added that, at present, no country in the world underestimates the role and position of the private economy.

Second , in a modern market economy, in countries with highly developed and efficient economies, the contribution rate to the gross national product of the private economic sector is always higher than that of the state economic sector.

Third , the private economy creates a strong driving force for development, contributes increasingly to the State budget, and participates actively and effectively in implementing social goals.

Fourth , the private economy has been gradually asserting its position as an “essential support” in accordance with the laws of the market economy. It has truly become a part of the private economy, and has the opportunity to develop strongly in both breadth and depth, in both quantity and quality.

Fifth , the development of the private economy is an inevitability arising from the law of the conformity of production relations with the development level of productive forces, which has the effect of promoting the development of productive forces. If we only consider the state economy and the collective economy as the foundation without placing the private economy in its proper position, then in essence, we still consider ownership as the purpose of all policies. We cannot let production relations go too far beyond the level of production.

With the previous level of development of productive forces, it is also impossible to "force" the State economy and collective economy to have greater potential than the private economy in a socialist-oriented market economy while they are not yet capable of doing so effectively.

III. Lessons learned from China's experience in private economic development

1. The process of private economic development in China

After its founding (October 1, 1949), China implemented socialist reforms of private enterprises (PEs) through nationalization or public-private joint ventures. Therefore, after only a few years, the private economic sector (PE) in China declined rapidly. If in 1949, PEs accounted for 63.3% of industrial output value, by 1952 this ratio was only 39%, and at the same time the output value of the private sector accounted for only 5.7% of the country's GDP. In 1956, China completed the socialist reform of PEs and handicraft households. After the "Great Leap Forward", the Chinese State opened its doors to small-scale individual enterprises (including handicraft households), but PEs were still not considered. During the period from the Cultural Revolution (1966) to 1978, the PE did not exist. By the end of 1978, along with reforms in rural areas, the private sector had gradually recovered. However, at first, only individual households were allowed to operate, and private enterprises did not have a clear legal status and were not officially recognized. Private owners who wanted to expand their business or hire more than 5 workers had to disguise themselves to avoid discrimination and obstruction from the government.

The role of private enterprises in China was officially recognized in the 1988 amended Constitution, which affirmed: “The Chinese State allows private enterprises to exist and develop within the scope of the law. Private enterprises are a supplementary component of the socialist state economy. The State protects the legitimate rights and incomes of private enterprises, with guidance and supervision.”

and adjustments to private enterprises”. In June 1998, the State Council of China issued the Provisional Regulations on Private Enterprises, which recognized private enterprises as “a for-profit organization, privately owned, and employing more than 8 workers”. In principle, private enterprises are allowed to operate in all fields (except for weapons production and the financial sector). Private enterprises also have the right to cooperate in joint ventures with foreign countries. Thanks to this innovation in perception, China's private economy has developed quite strongly. By the end of 1988, there were about 500,000 individual households that could be considered private enterprises (if considered from the perspective of labor use). In addition, there were many private enterprises operating under the guise of collective enterprises, these enterprises were called “red hat” enterprises. By the end of 1989, the number of officially registered private enterprises had reached 90,600.

After the Tiananmen Square incident (1989), the Chinese government increased tax collection on individual households and private enterprises. Private enterprises were even considered the source of the trend of ownership transformation in the Chinese economy. This had a negative impact on the development of the private sector. Specifically: the number of individual households decreased from 23.05 million (end of 1988) to 19.41 million (end of 1989). The number of private enterprises also decreased from 90,600 (end of 1989) to

88,000 (June 1990). This downward trend only stopped and the private sector continued to grow strongly after Deng Xiaoping's trip to the south.

The 3rd Conference of the 14th Central Committee (1993) decided on the formation of a socialist market economy in China, recognizing that the Chinese socialist market economy is a mixed economy in which the state economy plays a leading role. The State ensures fair competition for all enterprises of different economic sectors. The amended Constitution (March 1999) also clearly states: "The private economy and the individual economy are important components of the socialist market economy in China" and "The State guarantees the legal assets and incomes of the private sector". Thanks to

With breakthrough changes in policy, the private sector has become an economic sector with an increasingly important role in the Chinese economy. If in 1985, the industrial output of the private sector accounted for only 2% of the country's total industrial output, by 2005, this sector had reached 42.8%. During the period 1991-2000, the average annual growth rate in the number of enterprises, labor size and output of private enterprises was 38.1%; 34.4% and 59.4% respectively. In 2005, China had 27 million small businesses with less than 8 employees, 2.4 million private companies, creating jobs for 74.5 million people. It is estimated that private companies now account for 60% of the value of China's economy. From 1999 to 2005, the sales of these companies increased by 62%, many times higher than the national economic growth rate of 16%.

Thus, after more than 20 years of reform, China's private sector has finally received fair treatment. The 1990s witnessed many positive changes in the policies of the Chinese Party and Government towards the private sector. Currently, policies towards the private sector have been issued quite comprehensively. The private economic sector has entered the take-off stage. However, this is also a difficult period for this sector, because most of the reform efforts have been implemented, the business environment has been quite equal, so private enterprises have to develop based on their own internal strength.

2. Experiences that Vietnam can refer to

2.1. Need to unify perception and viewpoint on private economy

China's experience in developing the private economy shows that: under the leadership of the Party, the private economy sector can fully develop dynamically in a market economic environment, the Party and the State are fully capable of managing, supervising and orienting the development of the private economy.

It was only after Deng Xiaoping's famous trip south that the KTTN region developed rapidly. Deng's declaration had an impact.

much stronger than many laws and policies, it has truly liberated the thoughts, psychology and obstacles that hindered the development of private economy at that time.

Another issue that needs to be recognized next is to change the concept of "exploitation". We cannot continue to hold the concept that a businessman who dares to invest his own capital, creates jobs and brings stable income to many workers, while having to bear all the risks in business, even possibly losing money, going bankrupt, etc., is exploitation. The issue of exploitation in today's era should not only be viewed from a class perspective, but also needs to be considered according to the standards of social justice, when workers do not receive wages commensurate with what they have spent, or do not work in hygienic and safe working conditions according to regulations, and do not enjoy welfare regimes like others.

2.2. Avoid rigid politicization of economic activities

After the Tiananmen Square incident (1989), the activities of the private sector in China were more tightly controlled. Two of the policies were the Wenzhou government's anti-counterfeiting and anti-illegal goods policy and the policy of ensuring tax collection from the private sector. If these policies were not politically motivated and under pressure from the state-owned economic sector, they would obviously be beneficial to society. However, these policies were implemented only to reduce or eliminate the competitive pressures that state-owned enterprises were facing at that time. Many Chinese scholars have pointed out that the politicization of economic relations often brings bad results, if not to say eliminating the driving force of economic development.

2.3. Opening the market to private enterprises

After joining the WTO, China has opened its market to many foreign partners in the fields of manufacturing, finance, etc. However, currently Chinese private enterprises are still not allowed to participate in some important fields.

important sectors such as finance and real estate markets. According to the WTO report, the banking, insurance, telecommunications and transport sectors are still mainly sectors in which the State holds a large proportion of ownership with little participation from the private economic sector, especially the foreign sector. Enterprises that are 100% State-owned or in which the State holds a controlling stake continue to dominate the air and sea transport services sector.

Many Chinese scholars believe that it is necessary to open up the financial sector to private enterprises because: first, it is a matter of equal treatment among economic sectors; second, China needs many small-scale banks to provide capital to small and medium-sized enterprises, most of which are private enterprises; and finally , most of the capital for business activities comes from the informal capital market.

2.4. Strengthen propaganda and education work

It is necessary to organize propaganda, dissemination and education in the Party apparatus, state authorities at all levels, mass organizations, associations, mass organizations and all classes of people, especially the business community, students and pupils about:

- Social values and status, challenges and risks for business and entrepreneurs; ethical standards and business culture.

- Viewpoints and changes in thinking of the Party and State on the role, position, importance and objective necessity of developing the private economy in developing a multi-sector economy towards socialism; the importance of developing the private economy for economic growth and poverty reduction.

- Basic provisions of business and enterprise law such as: Commercial Law, Enterprise Law, Cooperative Law, State support and incentive regimes for business activities,... as well as the meaning and importance of fully implementing the contents of the above provisions for the development of the private economy.

CHAPTER 2

STATUS OF PRIVATE ECONOMIC SECTOR DEVELOPMENT IN VIETNAM'S INTERNATIONAL ECONOMIC INTEGRATION PROCESS

I. Integration orientation and milestones of Vietnam's international economic integration process

1. Integration orientation

Vietnam's policy is to "Promote industrialization and modernization, build an independent and self-reliant economy, and turn our country into an industrialized country." However, industrialization in our country is being carried out in the context of some developed countries in the world such as the US, UK, Japan , etc. having ended the stage of large-scale industrial development and moving towards knowledge-based economic development. Moreover, the industrialization and modernization of our economy is taking place in the trend of economic globalization, with countries around the world expanding their foreign economic relations.

According to the basic spirit of the foreign policy strategy affirmed at the Party's mid-term National Conference (7th term), the integration perspective can be summarized in the following points:

Firstly, with the goodwill of being friends with all countries, the Party's consistent viewpoint is to respect independence, sovereignty and territorial integrity, in the spirit of cooperation, equality and mutual benefit among countries. Acknowledging the diversification of types of relations and the unique identities of each country, taking the common interests of countries as the common point on the basis of unity in diversity.

Second, integrate but do not depend, expect, rely on, or have a passive mindset. Respect external assistance, but at the same time affirm the principle: cooperate in the spirit of self-reliance, maintain independence and sovereignty in all aspects. Promote diversification and multilateralization but at the same time

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