Improving Provincial Competiveness Index and Business Environment

The Provincial Competitiveness Index (PCI) is an effort to explain why some parts of the country perform better than others in terms of private sector dynamism, job creation and economic growth. Using new survey data from approprimately 10.000 businesses among 63 provinces and cities that describe their perceptions of their local business environments, as well as credible and comparable data from official and other sources regarding local conditions, the PCI acts as reliable references for investors, businesses communities and local authorities. 




PCI has become an effective instrument to advocate for business environment reforms at provinces. It also offers a tool for local government to improve their economic governance capacity. 


Economica Vietnam has been requested by DPI and the Provincial People's Committee in different provinces, e.g. Quang Nam, Dak Nong, An Giang,  etc. to cooperate with the provinces to develop the roadmap and strategy to improve the PCI in the provinces. Most recently on 28 July 2010, a high profile PCI diagnostis was organized in Gia Nghia, Dak Nong under the facilitation of Economica Vietnam.


  
Not seeing PCI ranking improvement as the ultimate goal, Economica Vietnam see it  a means to an end, i.e. the eventual improvement of the provincial business environment, the more effective economic and public governance of local authorities, and a more competitve investment climate. All these will result in more enteprises, more investment, more income and more jobs being brought into the provinces, thus helping economic growth and poverty reduction. The viewpoints are also shared by all of the provinces and the partners with which Economica Vietnam work. It has became the cornerstone for all of the action plans which Economica Vietnam have helped to work out.


To bring about the best values to the provinces, Economica Vietnam PCI team also include well-known and experienced experts from  from key institutions in Vietnam which are leading agencies in promoting provincial business environment, good public governance and provincial competitiveness, e.g. the Central Institute for Economic Management (CIEM), VASC and the Vietnam Chamber of Commerce and Industry. The process started with an in-depth analysis which digs into every PCI sub-indicators, analyzing the views and sentiment of the business and investor community towards the business environment. Comparative analysis with other provinces and performance evaluation over years were implemented. On that basis, an action plan was developped and consulted with the provincial authorities and the business community.  


Most of the provinces with support form Economica Vietnam have adopted the action plan and are now in the implementation stage. Support by Economica Vietnam was continued in the areas of implementation backstopping, evaluation and monitoring, capacity building, etc.

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