Resolution 68 is set to lift every restrictive "iron shackle"  -  from mindset to regulatory framework  -  and establish a new environment for the private sector to thrive.

A sidelined business class

Economist Hai Loc finally allows himself a smile. For the first time, the household economy has been included in a Party resolution, something he believes will help unlock its full potential.

"After nearly 40 years of Doi Moi (Renovation), it's only now that a Party resolution reaffirms the role of household businesses. That’s a breakthrough," he said.

Previously absent from any legal framework, household businesses  -  often small-scale and informal  -  are mentioned 10 times in Resolution 68, marking a clear shift in narrative.

The resolution outlines a strategy to provide “substantive and effective support” to small and micro-enterprises as well as household businesses, including plans to complete the legal framework, offer free access to shared digital platforms and accounting software, and provide legal consultation and corporate management training.

Additionally, the resolution emphasizes improving financial access for small businesses, especially those led by youth, women, vulnerable groups, and ethnic minorities in mountainous and border areas and on islands.

Historically, household businesses have operated on the margins with limited or no state support.

According to Le Duy Binh of Economica Vietnam, there are about 5 million household businesses nationwide, but only 1.7 million are officially registered with tax codes. The remaining 3.3 million remain informal.

This sector generates around 8.5 million jobs, accounting for 37% of total employment in the business sector  -  more than non-state enterprises (37%), FDI enterprises (22%), and state-owned enterprises (4.3%).

One in every 20 Vietnamese earns a living through household business. “It shows just how embedded this model is in our society. Household businesses are the ultimate social safety net,” Binh noted.

According to the 2020 Statistical Yearbook, the informal economy contributed nearly 30% of annual GDP from 2015 to 2020.

This data reveals another truth: Vietnam’s economy remains fragmented and vulnerable. Millions of street vendors, noodle shop owners, grocery clerks, and fish farmers continue to form the economy's backbone.

Historical grey zones

Despite Resolution 68's progressive stance on private sector development and lawmaking, it also acknowledges a sobering reality: the private economy still faces numerous institutional barriers, has not yet scaled up, and lacks sufficient competitiveness to become the core force of the national economy.

So where is the disconnect between vision and reality?

Statistics reveal the gap. According to the 2020 Statistical Yearbook, the registered private enterprise sector contributed only 8.64%–9.65% of GDP from 2017 to 2020.

These figures match findings from a 2023 report by the Ministry of Planning and Investment and the Central Economic Commission (now the Central Policy and Strategy Commission), summarizing Resolution 10 from 2017.

That the registered private sector consistently contributes less than 10% of GDP even after 40 years of reforms is telling.

From 2021 onward, the Statistical Yearbook no longer reports private enterprises as a separate category. Instead, they are merged with household and cooperative economies under the term “non-state sector.”

In the 2023 Yearbook, this non-state sector accounted for about 50% of GDP, 56% of total investment, and over 82% of total employment.

Due to this amalgamation, there’s no precise data on the private enterprise sector’s share of GDP.

Former CIEM Director Nguyen Dinh Cung noted: “Statistical classifications still refer to this as the non-state sector. Private enterprises are not properly defined or counted, reflecting inconsistent thinking.”

Economist Vu Thanh Tu Anh echoed the issue: “I honestly believe no one knows the exact contribution of the private sector to Vietnam’s GDP.”

According to Resolution 68, the private sector includes over 940,000 registered enterprises and more than 5 million household businesses, contributing around 50% of GDP, over 30% of state revenue, and employing 82% of the national workforce.

Economist Hai Loc added that registered private enterprises contribute around 28% of GDP  -  a figure he obtained from credible statistical authorities. This would make it the single largest contributor to Vietnam’s economy, surpassing the state sector (21%), FDI (just over 20%), household economy (21%), and cooperatives (1%).

This statistical ambiguity must be clarified to properly support the development of Vietnam’s private enterprise sector.

A hundred-year vision

Despite these issues, Resolution 68 sets a bold new course: “The private sector is the most important driving force of the national economy, leading growth, employment, productivity, competitiveness, industrialization, modernization, and the transition to a green, circular, and sustainable economy.”

It strongly calls for: “Eradicating outdated perceptions and prejudices against the private sector; accurately assessing its vital role in national development.”

This marks a significant leap in mindset.

Let’s look at past Party resolutions for context:

Resolution 10-NQ/TW (2017): The private sector is “an important driving force” of the economy.
Resolution 09-NQ/TW: Entrepreneurs play a “significant role” in industrialization and modernization.

From “a significant role” to “an important driving force” and now “the most important driving force”  -  the private sector’s status has evolved dramatically.

General Secretary To Lam reinforced this transformation, writing that: “The State must manage according to market principles, ensure the freedom to do business, protect property rights and fair competition, eliminate policy opacity and vested interests, and treat private enterprises equally with state-owned and foreign-invested firms.”

He emphasized that policies must instill investor confidence, encouraging bold investment, innovation, and participation in strategic economic sectors.

A shared momentum

Like Hai Loc, many leading economists express strong confidence in the private sector’s future.

Nguyen Dinh Cung said: “After decades working on business reforms and private sector development, I feel we’ve never had a better moment for reform. The General Secretary has opened the door  -  now it’s time to implement through laws and regulations. I’m very enthusiastic about the new resolution.”

He added: “We’re finally dismantling the old mindset of ‘if you can’t manage it, ban it.’ That’s exactly what we’ve hoped for.”

Former Vietnam Institute of Economics Director Tran Dinh Thien added: “Resolution 68 will shatter the institutional constraints and create the conditions for enterprise-led development. Under the current ‘ask-give’ system, businesses can’t reach their potential.”

He noted that after the Sixth Party Congress in 1986, the private sector exploded as people were allowed to invest and work freely. This sector played a vital role in reviving a struggling, impoverished economy.

He concluded: “Today’s context mirrors 1986 in many ways. I believe the opportunity to realize our national development aspirations has never been greater.”

Tu Giang - Lan Anh