Decision No. 283/QD-TTg 2020 Scheme on the Plan to restructure the service industry to 2020

DECISION

Approving the Scheme on the Plan to restructure the service industry to 2020, with orientations toward 2025^[1]

THE PRIME MINISTER

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to Resolution No. 05-NQ/TW of November 1, 2016, of the fourth plenum of the Central Committee of the Communist Party of Vietnam (the 12^thNational Congress) on a number of major guidelines and policies to further change the growth model with higher growth quality, labor productivity, and competitiveness of the economy;

Pursuant to the National Assembly’s Resolution No. 24/2016/QH14 of November 8, 2016, on the 2016-2020 plan to restructure the economy;

Pursuant to the Government’s Resolution No. 01/NQ-CP of January 1, 2017, on major tasks and solutions to direct the implementation of the 2017 plan on socio-economic development and state budget estimates;

Pursuant to the Government’s Resolution No. 27/NQ-CP of February 21, 2017, promulgating the Government’s Action Program on implementation of Resolution No. 05-NQ/TW and Resolution No. 24/2016/QH14;

At the proposal of the Minister of Planning and Investment,

DECIDES:

Article 1.To approve the Scheme on the Plan to restructure the service industry to 2020, with orientations toward 2025 (below referred to as the Scheme), with the following principal contents:

I. VIEWPOINTS AND OBJECTIVES

1. Viewpoints

a/ To develop the service industry in a fast, efficient and sustainable manner, ensuring the provision of basic services for national socio-economic development toward a modern economic structure to properly tap resources for economic growth and economic restructuring.

b/ The Plan to restructure the service industry must be feasible and have focal points, attaching importance to specific solutions and policies with measurable results which exert strong and prompt practical impacts according to market signals. Enterprises, especially private ones, shall act as an important force in the process of restructuring the service industry.

c/ To strongly develop the service sector to be modern, ensuring international and regional integration; to incorporate international commitments on services into socio-economic development plans.

d/ To restructure the service industry in association with administrative reform and raising of the quality of administrative services in various sectors and at different levels toward ensuring the concentrated and unified direction of the central government while promoting the proactivity and creativity of local administrations at different levels.

dd/ The Plan to restructure the service industry must consider information technology a lever and take international economic integration as well as the Fourth Industrial Revolution as the context for acceleration of science and technology application in the provision of service products; to actively develop the service “ecosystem”, giving priority to the services applying high technologies with higher competitiveness and leading the world in sectors where Vietnam has advantages.

2. Objectives and targets

a/ General objectives:

To restructure the service industry toward higher competitiveness, concentrating resources on development of a number of potential services with high intellectual and technological contents such as finance, banking, logistics and transport, information and communications technology, science and technology, education and training, health, and tourism, intensifying the export of services and reducing the service export-import deficit and proceeding to service export-import surplus, to accelerate the process of national industrialization and modernization.

To build and improve the system of policies and institutions on development of the service industry with a view to creating a complete policy and  institution framework toward building a quality, efficient and competitive service industry. To create a rational, stable and long-term economic lever system to promote the distribution and use of major social resources according to the market mechanism in the distribution of resources for development of various services. To build infrastructure of the service sector through focusing on the development of “infrastructure” services, including information and communications technology, education, logistics and transport, and finance-banking. To build the service “ecosystem” for creating breakthroughs in the development of services. To narrow the country’s service-related competitiveness gap with the ASEAN-4 countries.

To restructure the service industry toward increasing the proportions of the services applying high technologies, artificial intelligence and information technology to exert spillover effects on other services.

b/ Specific targets:

- The service growth rate in the 2016-2020 period reaches 6.6-7.1%. The service proportion in GDP approximates 41.5- 42% by 2020. In the 2021- 2025 period, the service growth rate will reach 7-7.5%. The service proportion in GDP will approximate 43- 44% by 2025.

- The proportions of trained employees in the service sector who possess certificates will approximate 25% by 2020 and 30-35% by 2025.

- Finance-banking: By 2020, commercial banks will basically have a capital adequacy ratio meeting Basel II standards, with at least 12-15 commercial banks applying Basel II by standardized approach, and at least 1-2 commercial bank(s) being among the 100 largest banks (by total assets) in Asia; the ratio of foreign currency credit to total credit will gradually be reduced; the ratio of foreign currency deposits to total payment instruments will be below 7.5%; to accelerate the development of cashless payment, optimizing ATM and POS networks. By 2025, the ratio of cash to total payment instruments will be under 8%; the proportion of non-credit service revenue to the total revenue of commercial banks will be 16-17%; the rate of non-performing loans of the entire system of credit institutions will be under 3%; all commercial banks will apply Basel II by standardized approach, and apply on a pilot basis Basel II by enhanced approach at commercial banks where the State holds controlling shares and joint-stock commercial banks with good governance quality that have completed the application of Basel II by standardization approach; there  will be at least 2-3 commercial banks listed among the 100 largest banks (by total assets) in Asia.

- Information and communications technology: By 2020, the average growth rate will be 10-15%/ year. To maintain the competitiveness and Vietnam’s position in 10 leading countries in the provision of software processing and digital content services. Vietnam will be fully capable of developing and producing information technology products and services that satisfy domestic and international market demands, laying a foundation for the development of a knowledge-based economy, helping master information systems, ensuring information security and national digital sovereignty, making the fullest use of advantages while minimizing adverse impacts to raise Vietnam’s capacity to approach the Fourth Industrial Revolution. By 2025, information technology will become an economic sector with fast and sustainable growth rate, high turnover and great export value; Vietnam will be able to take the initiative in producing information technology and electronic products and solutions and important telecommunications equipment serving socio-economic development activities, laying a foundation for the development of a knowledge-based economy, contributing to the mastery of information systems, ensuring information security and digital national sovereignty; to develop core technologies and products in finance, trade, agriculture, biology and climate change response, industrial production, and national security including cyber security and digital technologies in national defense.

- Distribution: By 2020, to raise the proportion of retail by modern commerce modes (trade centers, supermarkets, convenience stores, etc.) to 30%; the annual average growth rate of e-commerce will reach at least 20%; the proportion of retail revenue in e-commerce will account for over 5% of the total retail and consumption service revenue nationwide. By 2025, the proportion of retail by modern commerce modes will approximate 38%; the annual average growth rate of the total retail and consumption service revenue (not excluding price element) in the 2021-2025 period will reach 9%; the total retail and consumption service revenue will reach around VND 8.1 quadrillion; the added value of domestic commerce (according to comparative prices) will contribute about 13.5% to GDP by 2025.

- Education-training and labor: By 2020, vocational education will meet labor market demands in terms of quantity, quality, job structure and training level; averagely, vocational training will be provided for 2.2-2.4 million people every year with 25-30% of whom acquiring intermediate or collegial degree, 10-15% being trained in key occupations or trades, and 70-75% to be employed after the training. By 2025, vocational training will be provided every year for about 4.6 million people on average, at least 85% of whom will be employed or earn higher productivity and incomes after the training. To develop the size and network of schools for different training levels; to raise the educational quality in conformity with the objectives of curriculum and textbook renewal and the Fourth Industrial Revolution; to develop the contingent of teachers and education administrators; to improve institutions and renew the management of school management systems; to intensify investment in material foundations toward synchronism, standardization and incremental modernization; to step up the application of information technology to educational activities; to enter into international integration on education.

- Logistics and transport: By 2020, the total transport volume of the whole service industry will approximate 1.3 trillion tons-km (equivalent to 2.2 billion tons of cargo), 340 billion passengers-km (equivalent to 6.3 billion turns of passengers) with the annual cargo and passenger transport growth rate of 8-10% in the 2013-2020 period. By 2025, the proportion of logistics services in GDP will be 8-10%, the service growth rate will be 15-20%, the rate of outsource logistics services will reach 50-60%; logistics costs will be reduced to 10-15% of GDP; the national logistics performance index (LPI) will rank 50^thor higher in the world rankings.

- Science and technology: By 2020, the total factor productivity (TFP) of scientific and technological activities contributes 30-35% to economic growth; the value of hi-tech products and hi-tech application products approximates 40% of the total industrial production value; the technology and equipment innovation index rises 20% per year on average; the transaction value of the science and technology market rises 15% per year on average, and Vietnam reaches the level of the group of countries with fairly high world rankings in terms of innovation index. By 2025, the TFP of scientific and technological activities will contribute about 40% to economic growth. The transaction value of the science and technology market will grow 20% per year on average.

- Tourism: By 2020, to attract about 20 million turns of foreign tourists and 85-90 million turns of domestic tourists; tourism will contribute 9-10% to GDP with the total revenue from tourists reaching USD 35 billion; the tourism-based export value will reach USD 20 billion; more than 4 million jobs will be created, including over 1.6 million direct jobs. By 2025, to attract some 32 million turns of foreign tourists and over 130 million turns of domestic tourists; tourism will contribute over 10% to GDP; 70% of laborers directly engaged in tourism will receive professional and skill training and further training; the total revenue from tourists will approximate USD 45 billion; the tourism-based export value will reach USD 27 billion; 6 million jobs will be created, including 2 million direct jobs.

- Health: By 2020, there will be 27.5 hospital beds and 9 medical doctors per 10,000 people. By 2025, the figures will be 30 hospital beds and 10 medical doctors per 10,000 people; 95% of the population will participate in health insurance. The proportion of public expenditure for health will represent 4% of GDP. The rate of out-of-pocket (OOP) expenditure will be reduced to 35% of the total expenditure for health. The rate of households with catastrophic health expenditure will not exceed 2%.

II. MAJOR TASKS FOR IMPLEMENTATION OF THE PLAN TO RESTRUCTURE THE SERVICE INDUSTRY TO 2020, WITH ORIENTATIONS TOWARD 2025

1. To create a common environment for development of services

- To effectively realize the Government’s Resolution No. 02/NQ-CP of January 1, 2019, on further implementation of major tasks and solutions to improve the business environment and raise the national competitiveness in 2019 and orientations toward 2021; Resolution No. 19/2018/NQ-CP of May 15, 2018, on further implementation of major tasks and solutions to improve the business environment and raise the national competitiveness in 2018 and subsequent years; Resolution No. 19/2017/NQ-CP of February 6, 2017, on further implementation of major tasks and solutions to improve the business environment and raise the national competitiveness in 2017; Resolution No. 19/2016/NQ-CP of April 28, 2016, on major tasks and solutions to improve the business environment and raise the national competitiveness in 2016 and 2017, with orientations toward 2020; and Resolution No. 35/NQ-CP of May 16, 2016, on support for and development of enterprises through 2020; and the Prime Minister’s Decision No. 175/QD-TTg of January 27, 2011, approving the Overall Strategy on development of Vietnam’s service sector toward 2020, and Decision No. 808/QD-TTg of June 29, 2012, promulgating the Action Program for implementation of the Overall Strategy on development of Vietnam’s service sector toward 2020.

- In 2020: To finalize laws and guiding documents, including the Law on Investment, Law on Enterprises, Bidding Law, Law on Public Investment, and Law on Support for Small- and Medium-Sized Enterprises. To intensify the coordination for development support programs for enterprises.

- To scrutinize, amend and supplement in 2020 decrees on business conditions, export and import of services on the list of conditional business sectors and trades under the Law on Investment toward simplifying procedures and reducing cost and time for enterprises.

- To formulate and promulgate legal documents detailing and guiding the implementation of Competition Law No. 23/2018/QH14 passed by the National Assembly on June 12, 2018.

- To review and adjust policies, processes and procedures for approving supports for enterprises, especially small- and medium-sized enterprises, and technological development funds toward simplifying the processes and procedures for receipt of supports and provision of target and focal supports.

- To scrutinize and adjust regulations on business conditions in services so as to encourage the application of information technology and other technologies of the Fourth Industrial Revolution for creation of new services and improvement of modes of providing traditional services in order to raise productivity, efficiency and competitiveness of services.

- To build an e-government toward a digital government; to provide public services at level 4 according to the Government’s Resolution No. 02/2019/NQ-CP of January 1, 2019, on further implementation of major tasks and solutions to improve the business environment and raise the national competitiveness in 2019 and  orientations toward 2021.

- To invest in and develop information technology applications serving the state management work (GovTech) and public service provision in order to reduce public administrative costs and heighten the service quality for people and enterprises.

2. Finance-banking

- To formulate and promulgate regulations and instructions for phased implementation by credit institutions of the roadmap for application of Basel II in Vietnam.

- To develop the system of credit institutions with competitiveness on the domestic market, incrementally raising their international competiveness in 2020 and the 2021-2025 period.

- To develop modern banking products and services and facilitate the accessibility to banking services.

- To develop, manage and supervise important payment systems in the economy.

- To step up the application of digital technology and intensify innovation in designing and distributing banking products and services; to apply a mechanism for pilot management of the development of various types of financial technology services in the field of banking.

- To promote the application of key technologies of the Fourth Industrial Revolution in the management, development and provision of banking products and services, ensuring the economy’s higher accessibility to banking services on the basis of ensuring efficiency, safety and confidentiality. To build a regulatory sandbox for financial and banking services on the platform of information technology such as e-wallet,electronic Know Your Customer (e-KYC), peer-to-peer lending, crowdfunding, etc.

3. Information and communications technology

- To scrutinize and finalize legal documents, mechanisms and policies in order to create a favorable environment for development of post, telecommunications and information technology, meeting the requirements of comprehensive international economic integration, ensuring national sovereignty and security.

- To step up the application of information technology in activities of state agencies in association with the renewal of administration mode of the administrative system, creating publicity and transparency in state management work; to build an e-government, proceeding to a digital government.

- To intensify the application of information technology in corporate governance, exploitation and disposal of postal packages at postal enterprises, especially at public postal network management enterprises, with a view to providing quality and effective services for service users.

- To sustainably develop the information and communications technology market, shifting to new pillars (electronic industry, digital content industry and service, cyber safety and security industry, e-commerce, transportation, etc.), new objects (smart cities, digital government, digital citizens), and new space (in the region and international market). To develop and commercialize 5G telecommunications technology; to develop digital applications and contents on the platform of 5G telecommunications technology.

4. Distribution

- To revise the Government’s Decree No. 52/2013/ND-CP of May 16, 2013, on e-commerce.

- To efficiently materialize the Strategy on development of domestic commerce in the period up to 2025, with a vision toward 2035.

- To support domestic enterprises in connection with international e-commerce platforms such as Amazon, Alibaba, Rakuten, etc.

5. Education-training and labor

- To scrutinize and develop the network of education and training institutions nationwide; to raise the quality of the contingent of teachers and education administrators at all levels; to renew the general education program; to step up the career orientation and channeling in general education; to heighten the quality of teaching foreign languages, especially English, at all education and training levels; to step up the application of information technology in teaching, learning and education administration; to accelerate the delegation of autonomy and accountability to educational and training institutions; to increase material foundations ensuring the quality of education and training activities; to develop human resources, particularly high-quality ones.

- To arrange and plan the network of open vocational education institutions, ensuring the scale, structure and rationality in terms of discipline, occupation, training level, geographical area, standardization, and modernization, with different quality levels.

- To standardize quality assurance conditions in the vocational education system; to develop systems of quality assurance, assessment and grant of national vocational skill certificates.

- To step up the application of information technology in education and training and the application of new education and training models on the platform of information technology such as internet, and mobile devices (smart phones, ipads); to encourage models of cooperation between enterprises and education and training institutions in order to quickly raise the education and training quantity and quality, particularly in such sector with high demand as information technology.

6. Logistics and transport

- To consolidate Committee 1899 and its Standing Body with the integration of the task of coordinating logistics development to have a streamlined model, promoting the role of ministries and sectors.

- To revise the Law on Road Traffic; to formulate and promulgate documents detailing and guiding the implementation of the Railway Law.

- To formulate a scheme on institutional reform in order to encourage models of information technology application in logistics, such as cargo and passenger transport service trading platforms, etc.

7. Science and technology

- By 2020, to complete the review and adjustment of criteria on hi-tech enterprises under the Prime Minister’s Decision No. 19/2015/QD-TTg of June 15, 2015, prescribing criteria to identify hi-tech enterprises toward creating more favorable conditions for enterprises.

- To formulate mechanisms and policies aiming to encourage startup enterprises and individuals in the technology domain; to propose higher financial scale for various funds in order to support enterprises for investment in technology renewal.

- To review, amend and supplement national standards and technical regulations as well as conformity assessment process; to build and operate the system of standard databases on reference standards and productivity best practices in service of enterprises.

- To promote the transfer of technologies from advanced countries in the world to domestic enterprises, giving priority to hi-tech, environment-friendly projects, with potential spillover contributions and cooperation with domestic enterprises to join in global value chains.

- To step up research activities for technology mastery and transfer in the fields of information technology and production of products of Vietnamese brands such as software and digital content technology; technology for designing and  manufacturing integrated circuits and high-capacity memories; multi-media technology; multiple-access technology; artificial intelligence; and cyber safety and security technology; to develop a system of high-performance computing centers.

8. Tourism

- To finalize documents guiding the implementation of the Law on Tourism.

- To study and formulate a plan to raise the ranking of Vietnam’s tourism under the Travel and Tourism Competitiveness Index (TTCI).

- To formulate programs on promotion of Vietnam’s tourism via new advertising channels on the internet.

- Regarding entry procedures, to further finalize and promulgate policies facilitating and simplifying procedures for grant of entry visas to international tourists coming to Vietnam.

- To boost the implementation of Vietnamese tourist occupational standards (VTOS) under the ASEAN Mutual Recognition Arrangement on Tourism.

- To materialize key tasks set out in the Prime Minister’s Decision No. 103/QD-TTg of October 9, 2017, promulgating the Government’s Action Plan for implementation of the Political Bureau’s Resolution No. 08-NQ/TW of January 16, 2017, on the development of tourism into a spearhead economic sector.

- To encourage the application of information technology in tourism, and application of smart tourism solutions and technologies such as Internet of Things (IoT), virtual reality/augmented reality (VR/AR) technology; to apply artificial intelligence (AI) to probe into tourists’ demands and develop solutions to satisfy their demands, thereby increasing the added value of the tourism industry.

- To formulate framework policies for the online home rental services market (Airbed and Breakfast (Airbnb) model)) and related markets in the tourism industry (ticket booking, flight booking, etc.).

9. Health

- To improve the business environment, raise the competitiveness and effect sustainable development in the fields of medical examination and treatment, pharmacy and medical equipment under the Party Central Committee’s Resolution No. 19-NQ/TW of October 25, 2017, and the Government’s Resolution No. 35/NQ-CP of May 16, 2016.

- To continue following the roadmap for adjusting health service prices; to step up the socialization of health service provision. To further delegate autonomy and accountability to public non-business health units. To accelerate the roadmap for applying the market prices, and correctly and fully include reasonable expenses in prices of health services.

- To formulate mechanisms and preferential policies for development of the private health sector; to increase the proportion of hospital beds of the private economic sector; to increase medical testing, inspection and standardization services provided by the private economic sector.

- To boost the investment in and application of healthcare and medical treatment solutions based on the Fourth Industrial Revolution technologies such as cancer diagnosis by artificial intelligence (IBM Watson), remote healthcare, electronic medical records, and information technology-based hospital administration, etc.

(Specific tasks are provided in the Appendix to this Decision).

III. RESOURCES FOR IMPLEMENTATION

1. Socio-economic resources for implementation of the Scheme: state budget funds, capital of enterprises, international aid and other funding sources lawfully mobilized under law.

2. With regard to state budget funds, to comply with current regulations on state budget decentralization. Ministries, ministerial-level agencies and provincial-level People’s Committees shall base themselves on the objectives and tasks stated in the Scheme to make specific fund estimates for implementation under regulations.

3. To step up the mobilization of financial resources from organizations, individuals and enterprises at home and abroad for the implementation of the Scheme in accordance with law.

IV. ORGANIZATION OF IMPLEMENTATION

1. The Ministry of Planning and Investment, as the advisory and coordinating body of the Government for implementation of the Scheme, shall:

- Provide the Government and Prime Minister with advices and sum-up information on the organization, examination and evaluation of implementation as well as the regime of information and reporting on the implementation of the Scheme.

- Assume prime responsibility for, and coordinate with related ministries and agencies in, inspecting, supervising and evaluating the performance of the task of restructuring the service industry by sectors and localities; promptly propose to ministries, agencies and localities or competent authorities measures to handle arising problems and difficulties.

- Annually starting from 2021, send sum-up reports to the Government, Prime Minister and competent authorities on the situation and results of implementation of the Scheme and propose amendments and supplements to the Scheme in case of necessity.

2. Ministries, sectors and localities shall, according to their respective functions and tasks, actively incorporate the above-mentioned contents and tasks of restructuring the service industry in their assigned tasks.

3. Ministers, heads of ministerial-level agencies or government-attached agencies, and chairpersons of provincial-level People’s Committees shall:

a/ Based on the contents and tasks in the Scheme, expeditiously and actively work out their plans to restructure the service industry to 2020 with orientations toward 2025 in the sectors or geographical areas under their respective management.

b/ Regularly inspect and supervise the schedule and results of the restructuring of the service industry within the ambit of their assigned functions and tasks. Annually starting from 2021, review the restructuring of the service industry and send reports on results of the restructuring of sectors and domains under their management to the Ministry of Planning and Investment for summarization and reporting to the Prime Minister.

Article 2.This Decision takes effect on the date of its signing.

Article 3.Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, and related organizations and individuals shall implement this Decision.-

Prime Minister
NGUYEN XUAN PHUC

* The Appendix to this Decision is not translated.