Vietnam has fallen one spot in the World Bank's annual competitiveness rankings this year despite acknowledged efforts to make starting a business in the country easier.
Other countries in the region have improved their business environments more rigorously, according to Doing Business, a study published by the International Finance Corporation and the World Bank.
Vietnam was ranked 99 out of 185 economies this year. Last year, it had fallen from 90 to 98.
Vietnam has implemented a total of 18 institutional or regulatory reforms over the past eight years. The most recent reform was allowing companies to use self-printed value added tax invoices, the Washington-based lender said.
"Helping Vietnam to improve its competitiveness is one of the World Bank Group's priorities in Vietnam," Victoria Kwakwa, the World Bank Country Director for Vietnam, said in a statement. "Vietnam has implemented various reforms over the years to improve the business environment. However, the report findings also imply that more needs to be done to bring Vietnam to the level of other economies in the region."
The report, released Tuesday, found that 23 economies in East Asia and the Pacific have made their regulatory environment more business-friendly since 2005. During that time, China made the greatest progress in improving business regulations for local entrepreneurs.
Across the globe, Singapore continued to provide the world's most business-friendly regulatory environments for the seventh consecutive year.
Hong Kong also held onto its position as the second-best environment, followed by New Zealand, the US, Denmark, Norway and the UK.
The study, now in its 10th year, ranks economies on a set of indicators including how long it takes to start a business and to export or import goods.
Compared to the high-profile BRIC nations, Vietnam was eight places below China but it managed to best Russia, Brazil and India at 112, 130 and 132, respectively.
According to the World Bank, it takes 872 hours on average for a company to pay taxes in Vietnam, putting the country in the group of five economies with the slowest tax payment process. The nation's total tax rate is 34.5 percent of profit.
It also takes 34 days to start a business in Vietnam while businesses in many countries need just nine days to complete the procedures.
Vietnam, on the other hand, is in the top 10 economies with the cheapest costs for goods trading. The cost to export is US$610 per container, while the cost to import is $600 per container, according to the World Bank.
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