Expectations for growth breakthroughs from localities

According to compiled data on the socio-economic performance of Viet Nam’s 34 provinces and centrally governed cities, 12 recorded GRDP growth of 10% or more in the first nine months of the year. Quang Ninh remained in the lead with 12.54%, followed by Ha Tinh at 12.36% and Hai Phong at 12.08%. Thai Nguyen, Hung Yen, and Khanh Hoa also maintained growth rates above 11%.

Bottlenecks remain in policy implementation

The growth achieved by localities reflects not only their advantages in industry and trade or their ability to attract investment, but also the increasingly prominent role of local authorities in governance and policy implementation. When policies and mechanisms are enforced consistently and corporate difficulties are resolved promptly, the business environment improves.

President of the Viet Nam Chamber of Commerce and Industry (VCCI) Associate Professor Dr. Ho Sy Hung said that restructuring the administrative apparatus and operating the two-tier local government model had helped simplify procedures and reduce business compliance requirements.

In localities such as Phu Tho, Tay Ninh, and Bac Ninh, resolving land-related obstacles, strengthening decentralisation, granting greater autonomy to provincial-level People's Committee Chairpersons and introducing a “green channel” mechanism for investment have made it easier for businesses to operate. Many provinces have improved their ability to attract foreign capital, bringing additional resources into production and commercial activities, and creating fresh momentum for economic growth.

Similarly, the smart border gate model in Lang Son is still under development and has not yet officially launched, although certain components are already in place. For example, the digital platform is operational for border guard and customs forces at Dong Dang Border Gate. These initial applications are helping modernise the management and coordination of import and export activities. The use of technology is expected to shorten customs clearance times, reduce logistics costs, increase the number of vehicles processed, and ease congestion.

Nevertheless, a gap remains between the powers granted under written regulations and the ability to exercise them in practice. Many implementing agencies tend to choose the safest course of action for themselves, passing the risks and costs on to businesses.

According to VCCI, regulations governing inspections of imported animal feed allow businesses either to conduct their own conformity assessments at a cost of around 700,000 VND or to hire a certification body for approximately 5 million VND. However, to ensure legal certainty, firms still have to choose the far pricier option.

In the fisheries sector, the same products, such as shrimp, fish, and squid, may be subject to different tax rates depending on the guidance issued by tax authorities in various localities, ranging from 0% and 5% to 8% and 10%. The calculation of preliminary and final processing costs for seafood when determining corporate income tax liabilities also remains inconsistent across inspection periods. Many businesses are still left struggling to anticipate their financial obligations.

Many localities have accelerated administrative reforms, but their role in proactively supporting and enabling businesses remains limited, particularly for household businesses. A VCCI survey of more than 1,000 such household businesses in 2026 found that 73.3% considered their legal difficulties substantial or serious, while only 15.6% intended to convert into enterprises within the next two years.

“These gaps show that breakthroughs in implementation cannot be achieved simply by issuing more documents. They require changes to the way policies are executed, responsibilities are allocated, and results are measured,” Hung emphasised.

The need for new growth spaces

At a recent regular Government meeting, the Prime Minister called on many provinces and cities to achieve double-digit GRDP growth in the fourth quarter, with nine localities aiming for more than 15%. Localities whose growth rates remain below their targets were instructed to review and comprehensively assess their potential and available capacity, and strive to achieve their objectives as fully as possible.

To turn untapped potential into tangible growth, the VCCI President said that policy implementation bottlenecks needed to be removed, starting with the establishment of clear and legally secure principles. Where regulations are ambiguous, interpretations that benefit citizens and businesses should be prioritised. Applications should not be rejected merely because guidance is lacking, while officials who act in accordance with written instructions should be exempt from liability. Regulations should also not be applied retrospectively in ways that disadvantage enterprises. These principles would provide a legal basis for officials to handle their duties with confidence while enabling businesses to fully exercise the rights granted to them by law.

The enforcement of laws must also be uniform nationwide. Ministries and sectors should issue detailed guidance accompanied by reference appendices and specific examples. Professional clarifications should be made public so that they can be applied consistently to similar cases, reducing the risk of the same regulation being interpreted differently across localities.

Strengthening implementation capacity must go hand in hand with data integration. Staffing at the commune level should be determined by actual administrative workloads, alongside stronger professional support from the provincial level. Centralised data lookup systems should gradually replace manual verification between localities, thereby shortening processing times, reducing compliance costs, and enhancing service delivery for citizens and businesses.

Implementation quality should be assessed against concrete results using independent indicators covering processing times, costs incurred by businesses, and consistency in policy application. The performance of agency heads should be evaluated over cycles of at least three years. This timeframe is appropriate given policy execution lags and would encourage long-term reform.

“Policy innovation creates opportunities, but it is local implementation capacity that determines whether those opportunities are translated into tangible economic growth,” Hung concluded.

However, to achieve breakthroughs, localities must also identify their competitive strengths accurately and align their advantages with the development space of their regions, according to economist Dr. Nguyen Quoc Viet. Administrative rearrangement and local government reform should aim to open up new growth spaces through regional connectivity and the development of economic corridors, rather than simply increasing resources for traditional growth drivers.

Development space planning must be linked to coordinated investment in transport infrastructure, logistics, seaports, and connections between economic corridors. On this basis, localities can integrate industrial and agricultural value chains while making better use of their complementary strengths.

The establishment of growth areas and centres for innovation, science, and technology is also important for boosting added value. Localities with advantages in high-quality human resources and technological capabilities can promote service-sector development, support digital transformation, modernise production processes, and create new business models for industry, services, and agriculture.

“This is the necessary path for localities to transform their growth models and make effective use of new drivers and development spaces, instead of relying solely on increasing inputs into existing ones,” Viet stressed.