USAID Linkages for Small and Medium Enterprises (LinkSME) Project
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USAID Linkages for
Small and Medium Enterprises
(LinkSME) Project
Linkages for Small and Medium Enterprises (USAID LinkSME) Project
Annual Progress Report – Year 2
Covering the Period October 1, 2019 – September 30, 2020
Submitted October 30, 2020
This Annual Progress Report was made possible through support provided by the U.S. Agency
for International Development (USAID). The opinions expressed herein are the sole
responsibility of IESC and do not necessarily reflect the views of USAID or the United States
Government.
Prepared under the USAID Linkages for Small and Medium Enterprises (USAID LinkSME)
Contract No. 72044018C00002 managed by International Executive Service Corps
IESC Contact
Chad Ford
Associate Vice President
International Executive Service Corps
1900 M Street, NW
Suite 500
Washington, DC 20036
Tel: (202) 589-2643
Email: cford@iesc.org
Front cover photograph: Panel discussion on opportunities and challenges to develop
sustainable supply chains and value chains for Vietnamese enterprises at the workshop on
Supporting Vietnamese Enterprises to Develop Sustainable Value Chains in Hanoi on July 24.
The event was co-organized by USAID LinkSME and the Ministry of Planning and Investment.
USAID LinkSME Year 2 Annual Progress Report
Page 1Table of Contents
Table of Contents 2
Acronym List 3
Executive Summary 5
I. Introduction 7
II. Progress Against Planned Activities 7
A. Component 1: Policy and Regulatory Reform 7
B. Component 2: Government-to-Business Interactions 13
C. Component 3: Market Linkages 16
D. Component 4: Project Management 26
III. Risk Assessment 39
Annex A: Technical Activity Concept Note and Consultant Tracker 41
Annex B: Table of Indicators 42
Annex C: Objectives 46
Annex D: Annual Financial Status Report 53
Annex E: Summary of Electronic Attachments 58
Annex F: Project Bibliography 59
Annex G: Workshops, Forums, and Trainings 60
Annex H: Non-Expendable Property Report 62
Annex I: Media Coverage of USAID LinkSME Project in Year 2 63
USAID LinkSME Year 2 Annual Progress Report
Page 2Acronym List
ACAPR Advisory Council for Administrative Procedure Reform
AED Agency for Enterprise Development
AmCham American Chamber of Commerce
AP Administrative Procedure
APCA Administrative Procedure Control Agency
APCI Administrative Procedures Compliance Cost Index
AVP Associate Vice President
AWP Annual Work Plan
BSO Business Support Organization
CGF Credit Guarantee Fund
COR Contracting Officer’s Representative
COVID-19 Novel Coronavirus Disease of 2019
CSID Center of Supporting Industries Development
FDI Foreign Direct Investor/Investment
FTEE Full-Time Equivalent Employment
FY Fiscal Year
GCI Global Competitive Index
GVN Government of Vietnam
HCMC Ho Chi Minh City
IDC Industrial Development Center
IESC International Executive Service Corps
IT Information Technology
KPI Key Performance Indicator
LinkSME Linkages for Small and Medium Enterprises
MEL Monitoring, Evaluation, and Learning
MOIT Ministry of Industry and Trade
MOU Memorandum of Understanding
MPI Ministry of Planning and Investment
NDA Non-Disclosure Agreement
OOG Office of the Government
PMU Project Management Unit
PPE Personal Protective Equipment
Q Quarter
RFQ Request for Quotation
SFS Sourcing Fair for Supporting Industries
SME Small and Medium Enterprise
SOW Scope of Work
STTA Short-Term Technical Assistance
TACN Technical Assistance Concept Note
TOR Terms of Reference
U.S. United States
USAID United States Agency for International Development
USD United States Dollar
USG U.S. Government
VAMI Vietnam Association of Mechanical Industry
USAID LinkSME Year 2 Annual Progress Report
Page 3VASI Vietnam Association for Supporting Industries
VIA Vietnam Industry Agency
Vietrade Vietnam Trade Promotion Agency
VINASME Vietnam Association of Small and Medium Enterprises
Yr Year
USAID LinkSME Year 2 Annual Progress Report
Page 4Executive Summary
In Year 2, USAID LinkSME facilitated a total of 67 linkages valued at $5,092,376. Of this total,
61 linkages valued at a total of $1,134,876 were facilitated for small and medium enterprises
(SMEs). To respond to the COVID-19 pandemic, the project also facilitated six PPE linkages
valued at a total $3,957,500 for non-SME suppliers. In addition, USAID LinkSME encouraged
$6,566,622 in investments through private sector contributions associated with creating linkages
in Year 2. The project has signed 20 Memorandum of Understanding (MOUs) with lead firms
and 21 with business support organizations (BSOs). These MOUs demonstrate the interest and
confidence that lead firms have in linking with SMEs supported by the project, and the interest
that BSOs have in receiving support and learning from USAID LinkSME.
Per Modification 03 which was issued on November 27, 2019, during Year 2 the technical focus
on direct assistance to SMEs lessened. Instead, the project began working to raise the capacity of
BSOs to advance SME-lead firm linkages. To identify BSOs to engage with the project, during
Year 2 USAID LinkSME developed a BSO screening template that gauges the capacity and
interest of BSOs in expanding service capacity for their members in market linkages with lead
firms. This assessment also helps in developing trainings for BSOs based on their existing skills
and their needs. USAID LinkSME has completed assessments for 40 BSOs. As anticipated, most
of the 40 BSOs would benefit from general skill development in addition to specific service
trainings in market linkages.
Based on the completed capacity assessments, USAID LinkSME has separated the BSOs into
two groups: the first are BSOs with higher capacity to create linkages for SMEs, and the second
are BSOs with lower capacity that need to build their fundamental skills. USAID LinkSME has
created, piloted, and delivered two training modules for BSO beneficiaries. The fundamentals
training is targeted to the lower capacity BSOs and is designed to build BSO organizational
capacity in leadership, change management, marketing, branding, relationship building, the four-
step linkage process, supply chain fundamentals, and procurement in supply chains. The
intensive market linkages training is targeted to the higher capacity BSOs and is the project’s
conduit to transfer SME screening and readiness tools developed during Years 1 and 2 and reach
a greater number of SMEs that can receive technical assistance and better respond to lead firm
requests for quotations (RFQs).
The project completed its first policy reform effort on May 12, with Prime Minister Nguyen
Xuan Phuc signing Resolution No. 68/NQ-CP, which aims to simplify and reduce business
regulations during 2020-2025. The resolution ushers the way in for a new wave of regulatory
reform in Vietnam, which the project will support during the next three years. USAID LinkSME
provided technical inputs for the draft government resolution. After the signing, the project
helped develop an online tool and methodology to take stock of all business regulations as
required by the resolution. All ministerial agencies will use this tool to report their detailed
business regulations in various types of regulatory requirements, including license and certificate
obtainment; capital, infrastructure, and human resources; technical control of imports and
exports; reporting and information provision; and compliance with national technical regulations.
In early June, USAID LinkSME supported the Administrative Procedure Control Agency
USAID LinkSME Year 2 Annual Progress Report
Page 5(APCA) to review and revise the online tool. Contents and features of the tool were added and
tested to make sure that the tool is user friendly and automated to facilitate the data input
process. On June 26 and 27, USAID LinkSME piloted the tool with APCA staff to take stock of
business regulations, calculate compliance costs, and rationalize their application. After the
event, USAID LinkSME worked with APCA officials to develop recommendations to improve
the tool before its official launch in late July.
In September, USAID LinkSME continued to support APCA’s implementation of Resolution
68/NQ-CP. The project and APCA worked to define the scope of a manual on how to prepare
action plans for the resolution’s implementation. The manual will also include instructions on
how to use the online tool. The manual will help line ministries, Office of Government (OOG)
officials, provincial authorities, business associations, and other stakeholders to implement
Resolution 68 in a more coordinated and efficient manner and help business associations
understand how to comment on measures to reduce and simplify business regulations.
During Year 2, the project supported APCA to develop a toolkit for restructuring the
administrative procedure (AP) handling process. The toolkit helps standardize the processes and
transform the implementation of APs, thereby enhancing the government-to-business interaction
via the national e-service portal and the e-service portals of ministries and provinces. Throughout
the year, the project provided training to government officials on how to use the toolkit to
receive and handle petitions and complaints. On September 12, 2020, Minister-Chairman of the
Office of the Government Mai Tien Dung signed Official Correspondence No. 7616/VPCP-
KSTT on the provision of public services via the national e-service portal. The toolkit is included
in the correspondence for state agencies to review and restructure their APs.
USAID LinkSME is working with APCA to conduct the 2019 and 2020 Administrative
Procedure Cost Compliance Indexes (APCI). The review has selected 62 administrative
procedures for 2019 and 2020 related to business condition, investment, start-up, customs, taxes,
specialized inspection, construction, and the environment. In total, more than 3,000 private
sector enterprises were interviewed in Year 2 to collect their compliance costs and recommended
changes for these administrative procedures. Once this initial data has been analyzed, in-depth
field surveys will be conducted early in Year 3 to collect additional inputs and verify the
findings. The survey reports and final APCI reports will be submitted at the end of 2020,
benchmarked against the 2018 APCI to demonstrate the changes in compliance cost over the past
three years. The final APCI reports will also suggest reform opportunities to reduce barriers to
business based on the findings.
On March 21, USAID LinkSME received a request from the U.S. Embassy to address the U.S.’s
urgent need for increased quantities of personal protective equipment (PPE) due to the COVID-
19 pandemic. USAID LinkSME quickly assembled a dedicated task force, which conducted
rapid assessments of PPE producers, mainly in the textile and apparel sector. This resulted in the
identification of more than 180 companies with existing capacity to manufacture required PPE
items. The project’s data was presented to the U.S. Federal Emergency Management Agency,
order offers from Vietnamese suppliers were made to New York State and Maryland State
procurement systems, and more than nine buyers/U.S. importers/distributors were contacted.
USAID LinkSME helped to facilitate U.S. sourcing of nonsurgical isolation gowns and
USAID LinkSME Year 2 Annual Progress Report
Page 6accessories. The project’s efforts resulted in six confirmed orders for a total of 2.6 million
units of PPE with an export value of $3.95 million; these orders are in the process of being
fulfilled.
The project developed the USAID LinkSME COVID-19 Response Plan over April and May to
facilitate an expansion of scope and resources to support Vietnamese SMEs through multiple
anticipated phases of post-COVID-19 response. The plan outlined a broad, illustrative scope of
activities developed through situational analysis, expert opinion, and several rounds of
consultations with counterparts and key stakeholders. During Year 2, the project organized or
supported several post-COVID-19 conferences. As outlined in the Response Plan, the project
will continue to identify and support opportunities to assist SMEs in recovering and seizing new
market opportunities.
I. Introduction
The purpose of USAID LinkSME is to spur systemic changes in business relationships between
Vietnamese SMEs and lead firms participating in supply chains, fostering significant increases in
the quantity and/or quality of business linkages between Vietnamese SME-firms and lead firms.
Systemic changes include evidence-based regulatory and policy recommendations to improve the
SME enabling environment. The cost-plus-award-fee contract is valued at approximately $22.1
million, not including the award fee. The obligation at the end of Y2 was approximately $17.4
million with spent to date as of September 30, 2020 at $6,616,490. As per Section F, Deliveries
or Performance, F.6. Deliverables, subpart b. Annual Progress Report, the fourth Quarterly
Progress Report shall constitute the Annual Progress Report and is due to USAID/Vietnam on
October 31 of each year. The Annual Progress Report must be a comprehensive narrative report
summarizing the previous year’s activities and accomplishments using the annual work plan as a
starting point and will serve as a key tool by which USAID/Vietnam monitors the performance
of the Contractor.
IESC is the prime implementer of USAID LinkSME, joined by KPMG Vietnam and TAJ Media.
Under this Contract, IESC is supporting the below USAID/Vietnam’s Objectives. Additional
qualitative and quantitative data demonstrating the project’s progress against these objectives can
be found in Annexes B and C.
1. Strengthen the SME-lead firm Business Linkage Framework; and
2. Enhance Vietnamese SMEs’ capacity to participate in supply chains.
II. Progress Against Planned Activities
This section includes a detailed review of progress against the approved Year 2 annual work plan
activities by Component.
A. Component 1: Policy and Regulatory Reform1
The expected results from this component include improved policies and administrative
processes and a business environment that enhances the competitiveness of Vietnamese SMEs
1
The GVN Project Document title for Component 1 is “Promote Institutional Reforms, Simplify Regulations, Administrative
Procedures, Reduce Compliance Costs to Improve the Competitiveness of SMEs.”
USAID LinkSME Year 2 Annual Progress Report
Page 7and their successful participation in value chains. This includes identifying and eliminating or
simplifying regulations that incur unnecessary compliance costs to SMEs. The Government of
Vietnam (GVN) counterpart for this Component is APCA. During the first quarter of Year 2, the
project finalized discussions and planning with APCA for the list of activities that would be
implemented under this Component in Year 2, which were then carried out over the remaining
three quarters of Year 2. The activities and Year 2 progress under this component are described
as follows.
Component 1.1. Identify, Review, Assess, and Propose Reform Initiatives2
In this subcomponent, USAID LinkSME reviewed business-related regulations and procedures
to identify reform initiatives. During Year 2, the project developed a web-based toolkit to
support in the review and reform of business regulations; started implementation and data
collection for the APCIs for 2019 and 2020; and began reviewing the existing regulations
impacting the textile and garment industry.
CODE ACTIVITY NAME EXPECTED RESULTS
C1-1-001 Develop a toolkit to support the collection of A toolkit to support the collection of statistics,
statistics, review and cut down of the regulations review and cut down of the regulations concerning
concerning the business and production the business and production activities of
activities of enterprises. enterprises is developed and put into
implementation.
Year 2 Progress: In Quarter (Q)2, the project collaborated with APCA technical staff to define the toolkit. The
Component Lead provided formal concurrence on March 6, 2020. In Q3, the team developed the toolkit and APCA
provided approval. Work began in that quarter to transform the toolkit into a web-based solution and build it into
the OOG Information Technology (IT) system. In Q4, the team completed the web-based toolkit and integrated it
into the GVN website. Integrating the toolkit into the website helps government agencies easily use the toolkit for
taking stock, reviewing, and simplifying business regulations. Under this activity, the project trained 141 public
officials on how to use the toolkit. In addition, as part of their strong commitment on regulatory reform and
business environment improvement, the GVN launched the toolkit together with Resolution 68/NQ-CP on reduction
and simplification of business regulations at the Government Press Conference on September 29, 2020. As
regulatory reform required involvement of various state agencies, USAID is providing technical support for OOG
to develop a manual for implementation of Resolution 68/NQ-CP.
Reference: Web-based toolkit https://nq68.baocaochinhphu.gov.vn/ioc/page/nq68.htm
C1-1-002 Evaluate APCI of 2019 and 2020. Annual APCI evaluation report is made by the
Advisory Council in order to measure the
effectiveness of reforms and performance of the
reform initiatives by ministries and local
authorities, and to propose/ recommend reductions
in or cut-down on the categories of regulations or
Administrative Procedures (APs) or improvement
of the implementation stages that constitute a
barrier to production, business and economic
activities and to economic growth, which include
regulations and procedures for SME participation
in the value chains.
2
The GVN Project Document title for Component 1.1 is “Identify, Review, Assess, and Propose Reform Initiatives (including
reduction in and revision of) Business Conditions/Requirements, Legal Regulations, and Procedures, which are Currently
Imposing a Barrier to SMEs during their Production and Business Activities and Participation in the Value Chain; Evaluate the
Effectiveness and Performance of the Reform Initiatives by Ministries and Local Authorities.”
USAID LinkSME Year 2 Annual Progress Report
Page 8Year 2 Progress: In Q1, the project team worked on and submitted the technical assistance concept note (TACN).
In Q2, the project collaborated with Committee IV technical staff to design the plan to complete the APCI. The
Component Lead provided formal concurrence on March 2, 2020. The project developed and issued a Request for
Proposals on March 6, 2020. The selection committee assessed technical proposals on March 27, 2020. In Q3, the
project finalized discussions with Committee IV on the coordination mechanism between the selected consultancy
firm and the Advisory Council for Administrative Procedure Reform (ACAPR). Assessing compliance cost of
business-related administrative procedures began, and the list of APs to be included in the assessment was
finalized, totaling 43 APs. In Q4, the questionnaires were finalized, and APCA sent letters to all provinces’ people
committees requesting the lists of enterprises implementing all 43 APs in the last six months of 2018 and throughout
2019. The consultancy firm processed and analyzed the APCI data. As planned, surveys and verification workshops
will be conducted in November 2020.
C1-1-003 Review and propose options for improving A review report and proposed options for
regulations on import and export of textile and improving regulations on import and export of
garments. textile and garments.
Year 2 Progress: In Q3, the Component Lead provided formal concurrence for the TACN in April 2020 and
discussions with APCA on the study scope began. In Q4, the project finalized consultant recruitment; APCA, the
selected consultant, and USAID LinkSME discussed the study outline. The consultant conducted two surveys in
July/August 2020. The consultant is currently analyzing the information from the surveys and developing the report.
The consultant and project have tentatively scheduled the final consultative workshop in December 2020.
C1-1-004 Review, assess, and propose cut-down on, or Proposed cut-downs on, or reductions in, the
reductions in the business requirements/ business requirements/conditions which are either
conditions being barriers to businesses. troublesome or create barriers to
business/production activities and economic
growth.
Year 2 Progress: The activity has not been implemented in 2020. For better effectiveness, the project has integrated
reviewing the business barriers into different activities under the Year 3 work plan.
Component 1.2. Evaluate the Effectiveness of National Policy Reforms and Rules3
In this subcomponent, USAID LinkSME supports OOG and the Ministry of Planning and
Investment (MPI) to evaluate the effectiveness of the recent reforms related to national
competitiveness and the business environment. During Year 2, the project has conducted a study
and developed a report with policy recommendations related to APs impacting high-tech
industries. The project is also in the process of developing a report with recommendations on
enhancing national competitiveness in 2020.
CODE ACTIVITY NAME EXPECTED RESULTS
C1-2-001 Assess the effectiveness of, and propose The effectiveness of the policies, regulations and
additions to or revisions of the policies, APs relating to the activities of research,
regulations and APs relating to the activities of application and development high technologies by
research, application and development high enterprises is assessed and additions or revisions
technologies by enterprises. thereof are proposed.
Year 2 Progress: In Q3, the project recruited consultants to conduct this study and began desk research. In Q4, the
project supported APCA to conduct field surveys in Bac Ninh, Thai Nguyen, and Vinh Phuc to collect inputs from
SMEs. The consultant completed the first draft of the research report. The final consultative workshop is tentatively
scheduled for December 2020.
3
The GVN Project Document title for Component 1.2 is “Study and evaluate the effectiveness of the reform of national policies
and rules against needs and development roadmap; benchmark with that of other countries and withdraw lessons, good practice
of reforms and from which to propose appropriate reform for Vietnam SMEs participating in GVC.”
USAID LinkSME Year 2 Annual Progress Report
Page 9C1-2-002 Study the reform efficiency and propose The reform efficiency is assessed and solutions to
solutions to improving the business improving the business environment and enhancing
environment and enhancing national national competitiveness for 2020 are proposed.
competitiveness for 2020.
Year 2 Progress: In Q3, the project recruited consultants to conduct this study and began desk research. The
consultants carried out a field survey. In Q4, the project supported APCA to develop a study report with policy
recommendations. In July, the consultant carried out field surveys to validate the desk study and collect local
practices. The consultant is currently working on the report. This activity is proposed to extend to 2021.
Component 1.3. Compiling Global Breakthrough Lessons in Regulatory Reforms and Approaches4
In this subcomponent, USAID LinkSME supports the GVN counterparts to evaluate and adopt
relevant international best practices in policy reform. In Year 2, the project began the study of
the Global Competitiveness Index (GCI) to develop recommendations for Vietnam and began
identifying potential countries to study on the best practices in the application of ICT solutions
for business development.
CODE ACTIVITY NAME EXPECTED RESULTS
C1-3-001 Study the Global Competitiveness Index (GCI GCI 4.0 is studied and international experiences
4.0), international experiences and develop are summed up for proposed application in
recommendations for Vietnam. Vietnam.
Year 2 Progress: In Q3, the project developed the TACN and discussed the technical assistance scope with APCA
(GCI is broad, including 12 pillars with 103 indicators in 2019 GCI report). In Q4, USAID LinkSME discussed a
new approach for reviewing and analyzing the GCI with APCA. Dr. Vu Thanh Tu Anh (Dean of Fulbright School
of Public Policy Management and a member of the Economic Advisory Group of the Prime Minister Nguyen Xuan
Phuc) committed to provide technical advice to develop the methodology for reviewing the GCI. In addition,
through the USAID LinkSME project, USAID will provide technical support for the Ministry of Justice to conduct
two workshops on reducing regulatory compliance costs for improving business environment and enhancing
national competitiveness (one important pillar of GCI). The project plans to conduct these workshops at the end of
October 2020.
C1-3-002 Study international experiences on the Several international experiences are put together
application of ICT solutions in support of on how foreign governments apply ICT solutions
business development. to provide general support to enterprises.
Year 2 Progress: Policy Advisors worked with APCA technical staff in July 2020 to design a plan for the study,
with the activity commencing in the fourth quarter of 2020. Under this activity, USAID LinkSME is providing
technical assistance to OOG to review international experiences on the application of ICT to support business
development and recommend best practices that are relevant to Vietnam. The consultant is reviewing information.
Among the countries under consideration for the study are the United States, Korea, and Estonia.
Component 1.4. Capacity Building to Improve the Business Environment5
In this subcomponent, USAID LinkSME supports the GVN counterparts to build their capacity
to develop and implement reform initiatives. During Year 2, the project conducted post-COVID-
19 support conferences that drew in large numbers of participants and provided a forum for
4
The GVN Project Document title for Component 1.3is “Generate the breakthrough lessons and solutions adopted by countries
around the world to assist the advisory bodies in improve their approaches, comparative studies, assessment, learning, to make
fundamental changes in the mindset and actions as part of the process of reforming and improving the business environment in
Vietnam. Besides, conduct assessment on national policy and regulatory reforms that create barriers to business operations of
enterprises against national development roadmap and compare to that of other countries in the world.”
5
The GVN Project Document title for Component 1.4 is “Capacity Building Activities to Implement Reforms, Improve the
Business Environment of the Relevant Stakeholders.”
USAID LinkSME Year 2 Annual Progress Report
Page 10SMEs to voice their concerns about the impact of COVID-19. In addition, the project trained
more than 70 ACAPR members on the skills needed to advocate for policy changes.
CODE ACTIVITY NAME EXPECTED RESULTS
C1-4-001 Hold consultation workshops between Workshops between enterprises and ACAPR are
enterprises and the Advisory Council on APs successfully organized for consultation on the
reform (ACAPR) on policies/ mechanisms to policies and mechanisms relating to the support
improve the business environment for and encouragement of enterprises to take part in
businesses. the supply chains.
Year 2 Progress: In Q3, the Component Lead provided formal concurrence for the TACN in April 2020. Under
this activity, USAID LinkSME supported OOG to organize the conference on “Policy Recommendations to
Support Post-COVID-19 Business Recovery”, which occurred on May 26, 2020 with over 100,000 online
participants. The project also supported the Ministry of Science and Technology to organize the conference on
“Technological Innovation and Administrative Reform to boost SME’s productivity in the context of COVID-19”,
which occurred on October 7, 2020 with 75,500 online participants. Through these events, the GVN business
support policies have been widespread to the public. They have also provided an opportunity for business entities
to raise their concerns and recommendations to the country’s leaders.
Additionally, through LinkSME, USAID provided technical assistance to the Vietnam Association of Small and
Medium Enterprises (VINASME) to conduct an online consultation on the impact of COVID-19 and GVN support
policies. In this consultation, the project interviewed 781 SMEs on how COVID-19 has impacted their businesses
and their accessibility to the GVN’s support package. The project submitted the consultation report to the Prime
Minister and ACAPR. At a meeting with VINASME, the Prime Minister expressed appreciation of this effort and
committed to include some recommendations to the second phase support package.
C1-4-002 Provide training for experts and focal contact Training courses are effectively organized for
points of business associations and member experts and focal contact points of business
organizations of the ACAPR on the analysis, associations and member organizations of the
critical and advocacy skills with regard to ACAPR on the analytical, critical and advocacy
policies and regulations. skills with regard to policies and regulations.
Year 2 Progress: In Q3, the project developed the TACN and terms of reference (TOR). In Q4, the Project
Management Unit (PMU) reviewed and approved these documents. On September 14-15, 2020, USAID LinkSME
supported ACAPR to organize a training on policy analysis and recommendation for 70 representatives from
OOG, Ministry of Justice, Ministry of Finance, MOLISA, MONRE, Ministry of Industry and Trade (MOIT), MOC,
and 14 BSOs. In the training, participants discussed Rapid Impact Assessment, policy commenting experiences,
and Resolution 68/NQ-CP. Through the training, ACAPR members have more information, knowledge, and skills
to contribute to the policy making process.
C1-4-003 Build the capacity of technical staff of the Knowledge on pro-business policies is
Office of the Government and related disseminated to the technical staff members of the
agencies to make pro-business policies. ACAPR, Office of the Government and related
agencies.
Year 2 Progress: In Q4, Policy Advisors worked with APCA technical staff to design a plan for the training
sessions. Two trainings will be conducted in November and December 2020.
C1-4-004 Organize a study delegation to survey and A study delegation is successfully organized to
learn from international experiences on the learn from and study international experiences on
reform and improvement of the business the reform and improvement of the business
environment to the project’s stakeholders. environment in order to build capacity for the
people involved in reform initiatives, or making
decisions on the reform or improvement of the
business environment for SMEs.
Year 2 Progress: This activity has been moved to Year 3 due to COVID-19.
USAID LinkSME Year 2 Annual Progress Report
Page 11Component 1.5. Consolidate Options to Improve SME Policies6
In this subcomponent, USAID LinkSME supports the GVN counterparts to assess and revise
existing policies related to SMEs, the business environment, and national competitiveness.
During Year 2, the project began developing three thematic reports that will assist the GVN in
strengthening the implementation of Resolution 02/NQ-CP, a report summarizing the
implementation of Resolution 35/NQ-CP which includes recommendations for the next phase of
implementation, and a report on the implementation of Decree 39. These studies and reports will
support the GVN in reviewing and improving the implementation of these policies that have an
impact on SMEs.
CODE ACTIVITY NAME EXPECTED RESULTS
C1-5-001 Assess the implementation progress of An assessment report on the implementation
Resolution No. 02/NQ-CP of the Government progress and proposed development of Resolution
on continued implementation of key duties 02.
and solutions to improve the business
environment, enhance the national
competitiveness, and come up with directions
and proposals for the following year.
Year 2 Progress: In Q3, the Component Lead provided formal concurrence for the TACN in April 2020. The
project recruited three experts. Policy Advisors worked with the Central Institute for Economic Management
(CIEM) technical staff in June 2020 to design a plan for the study. In Q4, the experts conducted three surveys to
collect inputs for the report on Vietnam’s 2020 business environment and competitiveness capacity. The
consultative workshop to collect inputs on institutional issues that are hindering business and production activities
of enterprises was held in July 2020. The consultants are currently developing thematic reports on “Reform
analysis of Business Environment Improvement from the perspective of 2019 World Bank’s Doing Business
Report”, “Facilitating non-cash payment to support the increase of DBI and business environment improvement”,
and “Assessment of Resolution 02/NQ-CP implementation from the perspective of private sector to improve
business environment and support post-COVID-19 recovery”. MPI and the GVN will use these thematic reports to
strengthen Resolution 02/NQ-CP implementation in the coming years.
C1-5-002 Assess five years’ implementation of A report summing up 5 years’ implementation of
Resolution 35/NQ-CP/2016 of the Resolution 35/NQ-CP/2016 of the Government and
Government on supporting and developing proposed additions, revisions/replacements.
enterprises up to 2020 and propose directions
for business support for the next phase.
Year 2 Progress: In Q3, consultants conducted the study, wrote the draft report, and the project provided
comments for improvement. In Q4, the consultants revised and finalized the report. A consultative workshop is
scheduled for October 19, 2020 to collect further comments and feedback. Tentatively, the project will submit the
assessment report and recommendations to the MPI Minister and Prime Minister in the first quarter of Year 3.
C1-5-003 Organize annual conference between the A Resolution/Directive is issued after the
Prime Minister and businesses. Conference to direct the business support work for
the period 2021-2025.
Year 2 Progress: The conference could not be conducted in Year 2 due to the ongoing COVID-19 pandemic.
USAID LinkSME plans to reschedule this activity for Year 3.
C1-5-004 Review, amend/replace Decree 39/2018/NĐ- An assessment report on the implementation
CP providing for several Articles of the Law progress and proposed revisions, additions/
on SMEs support. replacement to Decree 39/2018/NĐ-CP.
6
The GVN Project Document title for Component 1.5 is “Advise and Consolidate Various Options to Improve Policies,
Mechanisms, and General Business Environment and Propose Improvements of the Policies and Laws to Facilitate the
Development of the Vietnamese SMEs, Enhance their Competitiveness, and Expand Opportunity to Outreach to the International
Markets.”
USAID LinkSME Year 2 Annual Progress Report
Page 12Year 2 Progress: In Q2, the project collaborated with the Agency for Enterprise Development (AED) technical
staff to design the plan to conduct the study. The Component Lead provided formal concurrence on March 19,
2020. The project developed a TOR for a consultant to conduct this activity. In Q3, the selected consultants
conducted the study, the draft report was written, and the project provided comments for improvement. In Q4, the
consultants revised and finalized the report. Two consultative workshops will be conducted to collect further
comments and feedback in Hanoi on October 19, 2020 and in Ho Chi Minh City (HCMC) on October 28, 2020.
Recommendations from the study and workshop will be used to revise Decree 39/ND-CP.
C1-5-005 Assess the progress of enterprises’ An assessment report and proposed solutions.
development and propose an assessment index
therefore in service of the Government
instructions and governance.
Year 2 Progress: In Q2, the project collaborated with AED technical staff to design the plan to conduct the study.
The Component Lead provided formal concurrence on March 3, 2020. The project and AED developed TORs for
two consultants. In Q3, the selected consultants conducted the study and drafted a report on enterprise
development and an outline on indicators of enterprise development. The project provided comments for
improvement. In Q4, the consultants revised the report and further developed the report on indicators.
C1-5-006 Assess the implementation situation of the The situation of implementation of the Law on
Law on SME Support and propose measures SMEs Support nationwide is assessed, and
for better and more effective implementation. proposals/recommendations are given for more
effective implementation of the Law on SMEs
support.
Year 2 Progress: In Q2, the project collaborated with AED technical staff to design the plan to conduct the study.
The Component Lead provided formal concurrence on March 19, 2020. In Q3, consultants conducted the study, the
draft report was written, and the project provided comments for improvement. In Q4, the consultants completed the
report. MPI will use the recommendations to report to the Prime Minister for further intervention.
Component 1.6. Evaluate Project from Phase 1, Mid-Term, and Completion7
No activities were planned under Component 1.6 during Year 2.
B. Component 2: Government-to-Business Interactions8
The expected results from this component include improved government-to-business interaction
with more effective modernization of online applications to better maximize enterprises’
investments, production capacity, business activities, and international integration. The GVN
counterpart for this Component is APCA. During the first quarter of Year 2, the project finalized
discussions and planning with APCA for the list of activities that would be implemented under
this Component in Year 2. The activities and Year 2 progress under this component are described
as follows.
Component 2.1. Propose Improvements to Online Enterprises and Investment System9
In this subcomponent, USAID LinkSME supports the GVN counterparts to review, restructure,
and standardize APs. In addition, the project develops digital tools to support GVN agencies to
review APs and collect feedback from the business sector. During Year 2, USAID LinkSME
developed a toolkit for AP restructuring for online provision, which was included as guidance for
7
The GVN Project Document title for Component 1.6 is “M&E: Phase 1 Evaluation, Mid-Term Evaluation, and Final Evaluation
upon the Project Completion.”
8
The GVN Project Document title for Component 2 is “Support to Increase Efficiency of Government-Business Interaction,
Facilitate the Investment, Business and International Integration Activities of SMEs.”
9
The GVN Project Document title for Component 2.1 is “Study and survey to propose improved methodologies to implement
policies, regulations and deliver public services to enterprises in a modernized manner by promoting online applications to create
favorable conditions for enterprises and the investment and business environment.”
USAID LinkSME Year 2 Annual Progress Report
Page 13state agencies in an Official Correspondence. USAID LinkSME also supported APCA to
restructure six APs so that they can be handled online. Development of a proposal to reform the
single window system for AP implementation was underway as of the end of Q4.
CODE ACTIVITY NAME EXPECTED RESULTS
C2-1-001 Assess and propose solutions to implement An assessment report and proposed solutions for e-
APs electronically in accordance with a single implementation of APs using a single window or
window or interlinked window system interlinked window mechanism.
Year 2 Progress: In Q3, the project collaborated with APCA technical staff to design the plan of the study scope to
support the implementation of Decree 45 and the development of the guiding Circular, a scope for developing the
"non-administrative boundary central OSS" model, and a TA scope for the development of the GVN Piloting
Master Plan of this model.
During Q4, the selected consultants worked to research “Handling administrative procedures in the electronic
environment”. In addition, USAID LinkSME supported APCA to develop a framework for the assessment of the
single window system and interlinked single window system. Under this activity, the project conducted a field trip
and three consultative seminars in Kon Tum, Gia Lai, and Phu Yen provinces. Based on the field trip and desk-
study, OOG will develop a proposal for reforming the single-window system during Year 3.
C2-1-002 Study and support the development of an An information/report system in service of the
information/report system in service of the Government direction and management of the
Government direction and management of the enterprises’ development is built and put into
enterprises’ development. operation.
Year 2 Progress: After discussions, APCA agreed that the activity should be carried over to Year 3 and adjusted
for better impact. Per the Year 3 work plan, the newly proposed activity is “Review and propose recommendations
for standardizing and simplifying reporting mechanisms from enterprises to state agencies”.
C2-1-003 Study and develop a toolkit for process A toolkit for process restructuring is built and
restructuring and AP streamlining to training is delivered on the use of the toolkit.
accommodate online provision of public
services to businesses.
Year 2 Progress: In Q2, the Component Lead provided formal concurrence of the TACN on March 19, 2020. In Q3,
the project collaborated with APCA to design the study and toolkit development plan. The project completed the
training plan and scheduled the first training course for July and began the development of the guidance
framework. In Q4, the project completed the toolkit. In addition, USAID LinkSME supported OOG to conduct four
trainings on the toolkit for national and local public officials. Furthermore, on September 12, 2020, the Minister,
Chairman of the Office of the Government Mai Tien Dung signed the Official Correspondence No 7616/VPCP-
KSTT related to online public services on the National Portal. In the correspondence, the toolkit is included as a
guidance for state agencies to review and restructure their APs for online handling.
C2-1-004 Study reforms of the processing for online Study reports are developed on the reformed
provisions of the public services that concern processes for online provision of the public services
business-related APs. that concern business related APs.
Year 2 Progress: In Q3, the Component Lead provided formal concurrence of the TACN in April 2020. Discussions
with APCA began to select six APs for the study and recommendation development. In Q4, USAID supported APCA
to develop criteria to select and prioritize APs for restructuring and online handling. Based on the criteria, APCA
prioritized and restructured six APs related to trade promotion, insurance, and tax payment. These APs will soon
be converted to be handled online.
USAID LinkSME Year 2 Annual Progress Report
Page 14Component 2.2. Recommend Improvements for Government Enterprise Portal10
In this subcomponent, USAID LinkSME supports the GVN counterparts to improve the online
portal and utilize it for receiving and processing business feedback. In Year 2, USAID LinkSME
developed a training plan for stakeholders and the public on how to connect to and use the Portal.
Four training workshops for officials in charge of handling online feedback via the Portal were
conducted.
CODE ACTIVITY NAME EXPECTED RESULTS
C2-2-001 Assess the status and propose solutions to Proposed solutions to improving the Portal for
improve the Portal for taking and resolving taking and resolving complaints and
complaints/recommendations from enterprises recommendations from enterprises to the
to the Government. Government are considered for application.
Year 2 Progress: In Q3, the project collaborated with APCA to design a plan connected with activity C2-2-003
because of the similarities of the system to have solutions to further improve and upgrade the activities. The
project completed the training plan. After discussion, APCA agreed that this activity should be carried over to
Year 3 and adjusted for more effectiveness. Per the Year 3 work plan, the newly proposed activity is “Develop
mechanism and tool to assess the effectiveness of handling businesses’ complaints/recommendations.”
C2-2-002 Study international experiences on application A study report on the international experiences on
of ICT solutions to support Government-to- application of ICT solutions to support
business interactions. Government-to-business interactions.
Year 2 Progress: In Q4, Policy Advisors worked with APCA in July/August 2020 to design a plan for the study. As
of the end of Q4, the consultant is working on the study. Tentatively, the study will be completed by December
2020.
C2-2-003 Deliver training to the stakeholders and the A set of training documents and guides to carrying
public on how to connect to and use the Portal out operations at different levels.
for taking and resolving complaints and
recommendations from enterprises, and build
capacity for the officers in charge of this
portfolio.
Year 2 Progress: In Q3, the Component Lead provided formal concurrence for the TACN in April 2020. The
project collaborated with APCA to design a plan for the study connected with activity C2-2-001 because of the
similarities of the system to have solutions to further improve and upgrade the activities. The project completed
the training plan. In Q4, the project conducted four training workshops from July to September 2020 for a total of
333 officials in charge of receiving and resolving the complaints/ recommendations via the Portal.
C2-2-004 Assess the status and propose solutions to An assessment report is developed and proposed
improving the quality of business solutions to improving the quality of business
consultations on policies. consultations on policies are considered.
Year 2 Progress: In Q3, the project discussed the study scope with APCA and followed up closely with APCA
about progress of GVN’s Master Plan on e-Consultation system so that this activity could support the
implementation of this Plan.
Due to COVID-19, the remainder of this activity will be carried out in Year 3. After discussion, APCA agreed to
adjust the activity to “develop a digital tool to consult business sector on policies, regulations, procedures and
reforming solutions” for greater impact.
10
The GVN Project Document title for Component 2.2 is “Upgrade and improvement of the Government portal for taking and
resolving complaints and recommendations from enterprises to the Government in a way to make it integrated and connected
within the administrative system of all levels in order to improve real-time interactions between the Government and enterprises.”
USAID LinkSME Year 2 Annual Progress Report
Page 15Component 2.3. Upgrade the National Database of Legal Provisions and Procedures11
In this subcomponent, USAID LinkSME supports the upgrading of the national database of legal
procedures and processes and the integration of this database with the National Portal on Public
services. During Year 2, USAID LinkSME began a study on how to make the national database
on APs more user-friendly.
CODE ACTIVITY NAME EXPECTED RESULTS
C2-3-001 Upgrade the national database on APs to The national database on APs and processes is
create an enabling business environment; and improved and linked with the national public
assist up-chain businesses to expand service portal to effectively service enterprises
production and business activities. both local and foreign.
Popular APs related to business and investment
activities are selected for translation and their
English versions are published on the national
database; business community is assisted in
looking up, using and operating the database
during the connection and completion of relevant
procedures.
Year 2 Progress: In Q3, the project and APCA discussed the outline for the study towards a more user-friendly
database. In Q4, Policy Advisors worked with APCA in July and August 2020 to design a plan for the study. As of
the end of Q4, the selected consultant is working on conducting the research. Tentatively, the consultant will
complete the final report at the end of December 2020.
C. Component 3: Market Linkages12
The expected results from this component are an improved SME supply capacity and
strengthening of business linkages between SMEs in their respective value chain. To scale
outreach to SMEs and increase success of sustainability efforts, the majority of efforts will be
delivered in close coordination with BSOs. An intensive BSO training effort is involved in this
component to increase the likelihood of success. The GVN counterpart for this Component is
AED of MPI. During the first quarter of Year 2, the project finalized discussions and planning
with AED for the list of activities that would be implemented under this Component in Year 2.
The activities and Year 2 progress under this component are described as follows.
Component 3.1. Evaluate the Law on SME Support13
In this subcomponent, USAID LinkSME supports the evaluation and implementation of the Law
on SME Support, with the goal of helping MPI to better execute the law and create a better
business environment for SMEs. During Year 2, USAID LinkSME conducted surveys to
disseminate information about implementation of the National SME Linkage Support Plan.
CODE ACTIVITY NAME EXPECTED RESULTS
11
The GVN Project Document title for Component 2.3 is “Upgrade the National Database of Processes, Legal Provisions and
Procedures; Support Searches, Usage, and Operations.”
12
The GVN Project Document title for Component 3 is “Enhance the Supply Capacity of SMEs and Strengthen Business
Linkages Between SMEs and the Supply Chains.”
13
The GVN Project Document title for Component 3.1 is “Study the development and support the implementation of programs
and schemes for SME support under the Law on SME support, which will focus on the SMEs to participate in the cluster and the
supply chains.”
USAID LinkSME Year 2 Annual Progress Report
Page 16C3-1-001 Develop a national SME support plan for 01 national SME support plan is submitted to the
2021-2025 period, focusing on assisting Prime Minister for approval, which focuses on
SMEs to take part in the clusters and the assisting SMEs to take part in the clusters and the
global value chains; and support for global value chains; and several aspects of the plan
implementation of the plan in some potential are implemented in some potential localities.
localities implementation of the plan in some
potential localities.
Year 2 Progress: Development of the TACN began in Q2. In Q3, the project internally approved the TACN and
submitted the draft version to AED. The MPI Minister provided comments, and AED submitted to the Prime
Minister. AED is now awaiting approval from the Prime Minister.
In Q4, the project conducted three surveys to introduce/disseminate information about the National SME Linkage
Support Program to ministries, local provinces/cities, and business associations and help them implement the
Program in their sector/localities.
Component 3.2. Build Capacity for Officials Providing Support to BSOs14
In this subcomponent, USAID LinkSME builds the capacity of officials providing support to
BSOs by developing tools for assessing BSO capacity and developing and delivering training
materials to build the capacity of BSOs in focus areas. During Year 2, USAID LinkSME
assessed the capacity of 40 BSOs to identify the priority areas for support. In addition, the
project developed fundamentals and intensive training modules for BSOs on topics designed to
improve their capacity to support SMEs in making linkages. These trainings have been piloted
and are being further rolled out in Year 3.
CODE ACTIVITY NAME EXPECTED RESULTS
C3-2-001 Assess capacity and identify priority/focus A set of criteria and a capacity assessment report
areas for support and build capacity BSOs. of the BSOs.
Year 2 Progress: In Q1, the project developed a BSO screening template to assess the will and skill of BSOs and
thus identify what BSOs can support in what kind of linkage creation activities. The assessments also helped in
developing trainings for BSOs based on their needs. The project aimed to screen 40 BSOs during Y2. In Q2, the
project screened 18 BSOs. By the end of Q3, the project had screened a total of 36 BSOs. The project screened an
additional four BSOs in Q4, bringing the total for the year up to 40. Currently, three parties (the participating
BSO, USAID LinkSME, and AED) have signed 21 MOUs this year.
C3-2-002 Develop training materials and training A set of training materials and training programs
programs to build capacity for BSOs focusing for BSOs are developed and improved.
on the project’s selected priority or focus areas.
Year 2 Progress: In Q2, the project collaborated with AED to design the plan to develop the training material for
BSOs. In Q3, the project and the selected consultants delivered a training outline for the courses. The training
outline included fundamental trainings and intensive trainings. The fundamental trainings include 10 topics to
help BSOs understand the fundamentals of operation and how to improve capacity. The intensive training includes
four modules, which aim to provide in-depth knowledge to help BSOs understand and effectively implement the
steps required for linkages activities between lead firms and SMEs. The project delivered two pilot fundamental
trainings for BSOs: one in Hanoi (June 15, 2020) and one in HCMC (June 24-25, 2020). 36 participants joined
the training on June 15, and 49 participants joined on June 24-25. After the pilot training, the consultants adjusted
the training outline. The project began developing and finalizing four intensive training modules. In Q4, the
consultants finalized the training outline, incorporating the feedback from AED and USAID. In Q4, the project
identified consultants for training development and delivery of “Professional Exhibition Preparation”, a topic
under module 1 as well as modules 3 and 4.
14
The GVN Project Document title for Component 3.2 is “Annually Build Capacity for Officials of Various Levels to Provide
Support to SMEs.”
USAID LinkSME Year 2 Annual Progress Report
Page 17C3-2-003 Deliver training to BSOs in the project’s Training courses are widely delivered to the BSO
selected priority or focus areas. community involved in the project.
Year 2 Progress: The project began developing the TACN in Q2, which received concurrence in Q3. The project
delivered two pilot trainings for BSOs: one in Hanoi (June 15, 2020) and the other in HCMC (June 24-25, 2020).
After the pilot training, consultants adjusted the training outline. In the end of Q3 and into Q4, the project
delivered training sessions for BSOs as well as support organizations to deliver the training sessions throughout
Vietnam.
The project delivered module 1 intensive trainings to BSOs during the June 24-25 trainings in HCMC with 49
participants. Module 1 trainings were also included in the BSO trainings in Hanoi on July 16-17 with 57
participants, in Thai Nguyen Province on July 28-29 with 39 participants, and in Binh Thuan Province on
September 17-18 with 40 participants.
The project provided some BSOs with on-the-job training for “Supplier Pre-evaluation”, a topic under module 2
of intensive training. For example, USAID LinkSME delivered on-the-job training to Vietnam High Quality
Product Association on July 17, 2020 at SME factories in Hanoi and neighboring provinces. Through field visits
to SMEs, the project provided training on supplier pre-evaluation to BSOs including VINASME, Vietnam
Association for Supporting Industries (VASI), Center of Supporting Industries Development (CSID), IDCS, and
TAC. Moreover, USAID LinkSME held a training course on September 26-27, 2020 for AED’s support officers
engaging with USAID LinkSME in Hai Phong Province.
In Q4, the project also identified potential BSOs to receive intensive support. Technical representatives of these
BSOs shall be trained on modules 3 and 4 intensive training topics.
In addition to the above trainings for C3-2-002 and C3-2-003, during the first quarter, AED
organized a half-day workshop on October 22, 2019 for intermediary organizations to learn
about post-project approval collaboration with USAID LinkSME and to offer input at the work
planning stage. More than 40 individuals from six public sector organizations concerned with
SME supply chain linkages participated, along with 12 private sector business associations.
USAID LinkSME presented the project’s objectives and approach while AED informed
participants about their requirements and sought feedback as part of the work planning process.
From November 19-26, 2019, USAID LinkSME joined AED in introducing project cooperation
opportunities to regional officials and organizations in two Central Vietnam provinces, Gia Lai
and Thua Thien Hue, as well as in HCMC. The workshops covered “Building Capacity for
Officials Performing the Task of Supporting SMEs and Effectively Implementing the Law on
SME Support”. AED co-organized the workshops along with the Gia Lai, Thua Thien Hue, and
HCMC Departments of Planning and Investment.
The Gia Lai workshop on November 20 drew 50 participants (16/32 percent women and 34/68
percent men), the Hue workshops on November 22 and 23 drew 70 participants from Hue,
Quang Ngai, and Quang Nam provinces (27/39 percent women and 43/61 percent men), and the
HCMC workshop on November 26 drew 55 participants (15/27 percent women and 40/73
percent men).
On December 18, 2019, USAID LinkSME accompanied representatives of the OOG and USAID
to Viet Tri City, Phu Tho province, to the conference on “Cooperation and Business
Development in the North Region” sponsored by VINASME and the Phu Tho Province People’s
Committee. USAID LinkSME presented project cooperation opportunities to more than 100
government officials, association leaders, and business executives at the plenary session, which
was also attended by project co-counterpart AED.
USAID LinkSME Year 2 Annual Progress Report
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