The private sector currently contributes over 40 percent of the total GDP (Photo: VNA)

Hanoi (VNA) – Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc has emphasised the need to attach due importance to the role of business households so as to fuel economic growth with greater strength.

He told Vietnam News Agency that the private sector has been mentioned with increasing frequency in many resolutions of the Party Central Committee. Recent statistics show that it contributes over 40 percent of the total gross domestic product (GDP), even higher than contributions by state-owned and foreign-invested enterprises.

Most countries around the world divide economic sectors into private and public ones, and the private sector consists of both domestic- and foreign-invested companies. Accordingly, the private sector now makes up over 60 percent of Vietnam’s GDP.

Therefore, it’s time to redefine the private business sector, which should be recognised as the main growth engine instead of only one of the important driving forces of the economy like in previous perspectives, Loc said.

In the long run, the private sector looks likely to develop with even greater strength to record the fastest growth in the economy, hence it is quite reasonable to set the target that this sector will account for 50-60 percent of the GDP in the near future.

Meanwhile, of the over 40 percent contribution to the GDP by the private sector, only 8 percent is from officially-recognised businesses, while the remainder is from the 5.2 million business households, which is a matter worthy of consideration.

Loc said authorities have repeatedly called for business households to be transformed into businesses, but both business households and grassroots authorities seem not to be interested in this issue.

He pointed out that the current definition of business households is not in line with international practices as business households themselves are already enterprises, noting that if this definition is changed, Vietnam’s target of having 1 million firms operating effectively by 2020 is entirely achievable.

The VCCI chairman said authorities should have due respect for business households, while creating optimal conditions for them to upgrade into enterprises, which will help enhance the growth quality in Vietnam.–VNA