The opinion that "Vietnam's GDP growth mainly relies on FDI, the health of private enterprises is weak" is being debated with many conflicting opinions.
The issue of the contribution ratio of the private economic sector to GDP in Vietnam is receiving much attention when it is argued that Vietnam's GDP growth still relies mainly on the FDI sector.
Regarding the economic structure, the report from the General Statistics Office only stated: In the GDP growth rate of 7.09% in 2024, the agriculture, forestry and fishery sector increased by 3.27%, contributing 5.37%; the industry and construction sector increased by 8.24%, contributing 45.17%; the service sector increased by 7.38%, contributing 49.46%. Therefore, it is difficult to determine the contribution of the private sector to GDP growth.
Regarding this issue, sharing on his personal page, Economic Expert Vu Thanh Tu Anh said that in the 1995 Statistical Yearbook, the GDP structure by "ownership form" in Vietnam was very simple, including only "state" and "non-state". The 1996 Statistical Yearbook did not even have the section "Gross domestic product by ownership form".
By the 1997 statistical yearbook, the classification of “economic sectors” suddenly became detailed, including 6 “sectors”, including: State economy, collective economy, private economy, household economy, mixed economy, and foreign invested economy (FDI).
Later, the mixed economic sector was removed from the classification, and in 2014, the statistical yearbook added the indicator “product taxes minus product subsidies”. Most recently, in 2021, the GDP structure by “ownership form” in Vietnam in the statistical yearbook was adjusted again. This time, the three groups “collective”, “private”, and “individual” were combined into “non-state economy” and were no longer counted separately as before.
Because the "private economy" according to the Statistical Yearbook only includes private enterprises officially registered at the Department of Planning and Investment of provinces and centrally run cities, it does not include the individual business household sector.
Therefore, during the 15 years from 2006 when Vietnam prepared to join the WTO to 2020 (the most recent year with data), the average proportion of the formal private economic sector (ie registered with the Department of Planning and Investment) in GDP was less than 9%.
"The highest year (2009), this rate was only 10.5%, the lowest year (2010) was 6.9%, and the most recent year with data (2020) was 9.7%. Data from recent years shows that the proportion of the official private economy in GDP is only about half that of the FDI sector and only about one-third that of the household economy," the expert said.
Besides, reality shows that Vietnam's traditional growth model still relies heavily on external motivation by attracting FDI capital thanks to cheap labor and natural resources.
Currently, more than 70% of Vietnam's export turnover is in the FDI enterprise sector. Since 2015, the proportion of FDI enterprises and domestic enterprises in exports has been 70/30, but by 2022, the proportion of FDI has increased to 74.4%.
FDI in the processing and manufacturing industry also ranks first in all fields, accounting for 58% of total investment capital in Vietnam, while creating high-tech manufacturing industries such as electricity, electronics - semiconductors, optics, etc. Therefore, the contribution of the domestic sector is still not commensurate with its potential.
Private enterprises have grown much stronger.
However, many opinions say that the data from 2020 is now quite old and outdated compared to reality when the private economic sector is increasingly developing. Not to mention, the private economy is a non-state economic sector including individual business households (informal sector). Therefore, if compared with FDI enterprises, the above two sectors must be combined to be appropriate.
Commenting on the health of private enterprises, businessman Do Cao Bao, member of the Board of Directors of FPT Group, said that first it is necessary to clearly affirm that according to the General Statistics Office, the GDP of the private economic sector is 50.6%, 2.3 times higher than FDI and 2.3 times higher than state-owned enterprises.
Specifically, the contribution of state-owned enterprises to the national GDP at current prices reached VND1,960 trillion, accounting for 20.54%; FDI enterprises reached VND1,950 trillion, accounting for 20.46% and the private sector reached VND4,820 trillion, accounting for 50.46%.
However, the General Statistics Office has not yet announced the contribution of private enterprises (those with business registration) to GDP. However, there are many figures showing that private enterprises are not "weak".
In the 2023 Statistical Yearbook (just published in December 2024), many indicators such as: Number of enterprises, revenue, total income of employees, number of employees, contribution to GDP of the private enterprise sector are all superior to that of FDI enterprises.
Specifically, of the total number of operating enterprises with business results, the State sector currently has 1,861 enterprises, FDI has 22,930 enterprises and the private sector has 735,500 enterprises.
Regarding revenue targets, in 2022, state-owned enterprises will reach VND4.31 trillion, accounting for 11% of total revenue, up 27.5%; FDI enterprises will reach VND10.98 trillion, accounting for 30.52%, up 16.1%; private enterprises will reach VND20.68 trillion, accounting for 57.5%, up 17.6%.
Regarding the total income of workers in 2022, the State sector reached VND 204,340 billion, accounting for 9.88%, FDI reached VND 790,431 billion, accounting for 38.22% and the private sector reached VND 1,073,113 billion, accounting for 51.89%.
"In particular, the target of contributing to the national GDP at current prices, out of 4.82 million billion VND, accounting for 50.46% contributed by the private sector, is estimated to be 29.46% for private enterprises and 21% for the household sector (agricultural, forestry and fishery households about 7%, industrial, construction and commercial households 14%)," said Mr. Bao.
In addition, revenue growth, return on capital, and average labor efficiency of private enterprises are also higher than FDI enterprises. Among the basic indicators of enterprises, FDI enterprises are only better than private enterprises in the index of average monthly income of employees.
Specifically, the average income of workers at FDI enterprises is 12.64 million VND/month, while that of private enterprises is 10.2 million VND/month. Therefore, Mr. Bao believes that the statement that "Vietnam's GDP growth mainly depends on FDI, the health of private enterprises is weak" is both old and outdated information.
Mr. Bao emphasized that the private economy obviously includes private enterprises and households. In many countries, there is no form of household business; all businesses are in the form of companies.
"The line between a household and a private enterprise is very thin. For example, a pho restaurant, if it establishes a company, it is a private enterprise, but if it does not establish a company, it is a household. Or an online seller, a youtuber, or a streamer registers a household business but their sales can be much larger than many small companies," Mr. Bao gave an example.
Therefore, it is unreasonable to say that private enterprises do not include household businesses. If Vietnam considers households as private enterprises, then private enterprises account for 50.6% of GDP. Then it cannot be said that Vietnamese private enterprises are weak, accounting for only 10% of GDP.
"Even when separating households and only counting private enterprises with business registration, based on data on revenue, total income of employees, total profit of state-owned enterprises, FDI enterprises, private enterprises and some other indicators, it can be estimated that private enterprises account for 29.6%, households 21%, not inferior to the FDI sector," this businessman emphasized.
(doanhnhanvn.vn)
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