Provincial competitiveness rankings of 34 localities released

The VCCI on May 15 released the 2025 Provincial Competitiveness Index (PCI 2025), unveiling a new-generation assessment framework at a pivotal moment in the country’s economic reform process.

First introduced in 2005, the PCI report conducts an annual business survey, assessment and ranking of the economic governance quality of provincial authorities in creating a favorable business environment for development of the private sector. 

PCI 2025 features a new structure comprising nine component index groups and 98 evaluation criteria. Rather than continuing to publish a single comprehensive ranking, PCI 2025 shifts toward governance-quality groupings designed to better reflect differences among localities during Viet Nam’s ongoing administrative restructuring process.

Among the five best-performing localities, Bac Ninh province took the lead in Proactive Governance and Administrative Procedure Compliance Costs; Da Nang City ranked first in Market Entry; Hai Phong City stood out, with 7 out of 9 sub-indices placing among the top 10 localities nationwide; Phu Tho province excelled in Access to Resources, while Quang Ninh province continued to maintain high rankings in Fair Competition and Proactive Governance.

The VCCI reported that the common strength shared by the top five performis not a single advantage, but their ability to maintain balanced governance structures—from reducing administrative costs and improving transparency to strengthening the enabling role of government.

One of the report’s most notable findings is the time-linked relationship between governance quality and private-sector performance. Data analysis indicated that provinces with stronger governance quality in 2022 generally recorded higher private-sector efficiency by 2025.

According to VCCI Chairman Ho Sy Hung, this suggests that institutional reforms often require a lag of around three years before generating visible impacts on business activity. He described the finding as an important basis for sustaining long-term reform programs rather than expecting immediate results.

On this occasion, the VCCI also unveiled the Viet Nam Private Economic Report 2025. The move is regarded as a significant shift in how Viet Nam evaluates local economic growth, as the private sector is increasingly identified as a key driver of the national economy.

The new index comprises 23 criteria grouped around two major dimensions: private-sector development and innovation capacity. Beyond measuring business size or revenue growth potential, the index also reflects levels of technological investment, product innovation, and participation in value chains among local enterprises.

According to the VCCI, the rankings are not simply a reflection of economic scale, but rather of the ability of localities to create environments where private enterprises can operate effectively and adapt to new growth demands.

As the country targets two million businesses by 2030, reform priorities are expected to move beyond simply cutting administrative procedures toward building genuine competitive capacity for the private sector./.