In the course of each country’s development, there are stages in which indicators such as GDP growth rate, the scale of investment inflows, or the level of international integration no longer play a decisive role. At that point, the true focus of development shifts to a more fundamental question: whether the institutional system possesses sufficient capacity to organize, lead, and ensure the effective functioning of society. Development history shows that a country lacking natural resources can still achieve breakthroughs if it possesses a transparent, flexible institution that serves development. Conversely, a nation with abundant potential may exhaust itself if it is constrained within a legal system that is formalistic, overlapping, stagnant, and increasingly detached from the practical dynamics of social life. Over 40 years of Doi Moi, Viet Nam has demonstrated that every significant advancement has been associated with institutional breakthroughs. However, it must also be candidly acknowledged that, in not a few areas, the law is still operating according to the logic of state administrative governance rather than the logic of development. Numerous regulations continue to prioritize “safety for the apparatus” over “social development.” Compliance costs in many places remain high. The space for creativity of the people and enterprises continues to be narrowed by invisible barriers bearing the names of “procedures,” “licenses,” and “business conditions.” Today, the Fourth Industrial Revolution, the digital economy, artificial intelligence, and the globalization of value chains are fundamentally transforming modes of production and governance; a slowly reformed legal system is not merely an impediment but also a strategic risk to national competitiveness. When capital flows, technology, and high-quality human resources can move rapidly across borders, institutions are no longer merely “internal matters” but become a decisive factor determining a country’s position on the world map. Therefore, the law cannot merely function as a management instrument; it must become the foundation for ensuring freedom of business, promoting innovation, protecting human rights, and unlocking all social resources.
The article by General Secretary To Lam, “Institutional and Legal Breakthroughs for the Country’s Rise,” reflects a new stage in national governance thinking. From the requirement to reform legislative thinking, abandon the viewpoint of “if it cannot be managed, then prohibit it,” and take the people and enterprises as the center, to the building of an open, transparent, low-cost legal environment, one can discern a rule-of-law ideology that is developmental, modern, and oriented toward the long term. These are not merely technical orientations in legislative drafting, but a redefinition of the State’s operational philosophy in the new stage of development: from a “managing State” to a “service-oriented State,” from a “controlling State” to an “accompanying State,” from a “reactive State” to a “proactively developmental State.” Taking the people and enterprises as the center in law-making is therefore not merely a reform slogan; it constitutes the ideological core of a modern rule-of-law model - one in which the law becomes a foundation for development rather than a burden of management.
Escaping the mindset of "prohibition for ease of management"
When the General Secretary emphasizes the requirement to “resolutely abandon the mindset of if it cannot be managed, then prohibit it,” this is not merely a technical reminder but a forthright critique of an institutional malaise that has persisted for many years. In practice, not a few policies have been promulgated from a psychology of risk aversion, fear of responsibility, and fear of making mistakes. When managerial capacity is lacking, the easiest solution chosen is prohibition. When supervisory instruments are insufficient, additional barriers are erected; when there is a lack of confidence in the market, control is tightened through administrative orders. The consequence is that innovation is constrained, enterprises are pushed into grey areas, and social resources are wasted. The direction of the General Secretary clearly demonstrates a break from that mindset, closely aligned with the doctrines of “adaptive governance” and “regulated liberalization” as recommended by the Organization for Economic Co-operation and Development and the World Bank: the State must not use prohibition to conceal deficiencies in governance capacity.
"Taking the people and enterprises as the center": The shift toward soft power
Taking the people and enterprises as the center in the formulation and implementation of law, ultimately, is not merely an adjustment in management but reflects a fundamental shift in the power structure of the modern State. It marks a transition from power based primarily on administrative orders, control, and coercion to power grounded in persuasion, consensus, trust, and cooperation - namely, soft power in national governance. In the traditional management model, state power is mainly manifested through systems of legal documents, licenses, procedures, and sanctions. The State occupies an absolute central role in determining “what is permitted” and “what is not permitted.” The people and enterprises, in many cases, exist as “ask–grant” subjects, dependent on the permission of the administrative apparatus. This approach may have been appropriate when the economy was simple and market development limited, but it increasingly reveals its limitations in a context of social complexity and deep integration. As the economy shifts toward a model based on knowledge, innovation, and global networks, purely administrative power is no longer sufficient to effectively regulate social relations. No apparatus, however streamlined, can “command” creativity, and no system of procedures can substitute for the intrinsic motivation of enterprises and workers. Under such conditions, the State is compelled to restructure the manner in which it exercises power: from control to guidance, from imposition to development facilitation, from command to institutional design. Placing the people and enterprises at the center of the law is the clearest manifestation of this shift. When the law is formulated on the basis of society’s practical needs, when compliance costs are minimized, and when freedom of business and property rights are substantively guaranteed, the State need not intervene excessively in economic activities while still maintaining order and efficiency. Power then operates not primarily through coercion, but through trust, voluntary compliance, and institutional legitimacy.
When the people and enterprises trust that their rights and interests are protected by law rather than by personal connections, they are willing to comply with common rules and cooperate with the State in policy implementation. The shift toward soft power simultaneously transforms the role of the public apparatus. Officials and civil servants are no longer merely those who “inspect – license – sanction,” but must increasingly become those who “support – advise – accompany.” Managerial effectiveness is no longer measured primarily by the number of legal documents promulgated or violations handled, but by the level of social satisfaction, the conduciveness of the business environment, and the sustainable development capacity of the economy. Notably, soft power in governance does not diminish the role of the State; on the contrary, it consolidates state power at a higher level. In the long term, voluntary compliance and social cooperation constitute the most solid foundation of a rule-of-law order.
From this perspective, the emphasis by General Secretary To Lam on taking the people and enterprises as the center is not merely an orientation for administrative reform, but a development in the thinking on state power under new conditions. It represents a transition from “governing power” to “service-oriented power,” from “impositional power” to “persuasive power,” and from “hard power” to “institution-based soft power.” If institutionalized seriously and implemented consistently, this shift will create a governance system grounded in trust, responsibility, and creativity - core factors determining national competitiveness and resilience in the twenty-first century.
Protecting human rights through the principle of proportionality
A particularly noteworthy point in the direction of the General Secretary is the requirement to “effectively protect human rights and citizens’ rights; ensure a balance and reasonableness between the degree of rights restriction and the legitimate interests achieved.” This statement carries substantial academic content and reflects modern rule-of-law thinking. In a rule-of-law State, human rights are not matters that may be restricted arbitrarily for administrative convenience. Any limitation must satisfy the principle of proportionality: necessity, suitability, and non-excessiveness. This principle constitutes a pillar of the legal systems of Germany and the European Union. The emphasis placed by the General Secretary on this element indicates that Vietnamese legislative thinking is approaching advanced rule-of-law standards. At the same time, the orientation to regulate only issues of a principled nature, while assigning frequently changing matters to the Government and executive agencies for further specification, reflects highly practical legislative thinking. In the era of digital technology, artificial intelligence, and the platform economy, if laws are overly detailed and rigid, they will quickly become obsolete. In such cases, the law itself becomes an impediment to innovation. The “framework law – flexible governance” approach is consistent with the doctrines of adaptive governance and smart regulation, which have been successfully applied in several Asian countries such as Singapore and South Korea. Law to liberate productive forces: the spirit of the developmental State. By emphasizing the requirement to “liberate the entirety of productive forces and unlock all resources,” the General Secretary places the law in its proper economic role: an instrument of development. Law is not neutral; it can generate growth, but it can also stifle growth. This reflects the spirit of developmental State theory, which contributed to the success of Japan, South Korea, and Taiwan. The State does not replace the market, but removes bottlenecks for the market and creates an environment in which enterprises can rise.
Freedom of business, property, and contract: The foundation of the modern market economy
General Secretary To Lam emphasizes: “Substantively ensure freedom of business, property rights, and freedom of contract; and equality among enterprises of all economic sectors.” This is not merely a policy requirement, but a clear affirmation of the core legal foundation of the modern market economy. In every developed economy, the three rights - freedom of business, property rights, and freedom of contract - are regarded as the “institutional infrastructure” of the market. Where these three rights are substantively guaranteed, the market operates transparently, resources are allocated efficiently, and incentives for innovation are stimulated. Conversely, when these rights are constrained by administrative barriers, arbitrary intervention, or institutional risks, the market economy exists only in name. Freedom of business is the right to choose lawful lines of business without unreasonable obstruction. It is the condition for the formation of entrepreneurial spirit, fair competition, and innovation. When this right is eroded by sub-licenses and unreasonable business conditions, the economy becomes administratively driven and dependent on relationships rather than capacity. Property rights constitute the foundation of long-term investment and social accumulation. Without firm guarantees of property rights, enterprises are unwilling to expand production, invest in technology, or undertake innovative risks. In a market economy, capital flows only to places where property rights are effectively protected by law. TOn that basis, freedom of contract is the “lifeblood” connecting economic actors. An economy operates stably only when commitments are respected and strictly enforced. If contracts lack legal certainty, the market falls into a state of distrust, transaction costs increase, and economic relations tend to become informal. Notably, the General Secretary underscores the element of “equality among enterprises of all economic sectors.” This is a central principle of market competition. Only when state-owned enterprises, private enterprises, and foreign-invested enterprises are treated equally in legal terms, in access to resources, and in business opportunities can the market truly perform its function of selection and efficiency enhancement. The three rights—freedom of business, property, and contract - together with the principle of equality, form a unified whole. Only when these rights are guaranteed in a coherent and substantive manner can the market economy operate according to its true nature, and can internal social resources be transformed into drivers of sustainable development. From this perspective, the direction of the General Secretary is not merely aimed at removing immediate difficulties for enterprises, but at building a long-term institutional foundation in which the law becomes a pillar of investment, innovation, and market confidence.
Private economy - The central driver and the measure of institutional reform effectiveness
Within the system of viewpoints on building and improving institutions, General Secretary To Lam clearly affirms: “The private economy is one of the most important driving forces of the national economy.” This is not only a consistent continuation of the policy of developing a multi-sector economy, but also reflects a new development in the awareness of the role of the private sector in the current stage of development. In a modern market economy, the private sector not only makes substantial contributions to growth, employment, and the state budget, but is also the principal actor in innovation, technology transfer, and international integration. National competitiveness, ultimately, is determined by the strength of the private business community. An economy lacking a dynamic private sector will find it difficult to form sustainable internal capacity and will be prone to dependency. However, the private economy can develop robustly only when placed within a legal environment that is secure, transparent, and predictable. Therefore, affirming the driving role of the private economy simultaneously imposes an urgent requirement on law-making: the law must become a foundation for enterprise development, rather than a barrier to business activities. In practice, many of the difficulties faced by the private sector stem not only from shortages of capital or markets, but also from institutional risks: overlapping regulations, complex procedures, unstable policies, and high compliance costs. When enterprises must devote excessive resources to “coping with” procedures, their capacity to invest in technology, human resources, and production expansion is constrained. This constitutes an institutional bottleneck that legal reform must prioritize addressing.
The formulation of law in connection with private economic development, therefore, does not merely involve promulgating additional support policies, but more importantly designing a favorable legal space in which enterprises may compete and innovate freely. This includes substantively ensuring freedom of business, protecting property rights, enhancing the effectiveness of contract enforcement, and guaranteeing equality in access to resources and market opportunities. From the perspective of modern governance, a developmental State does not “pick winners,” nor does it substitute for enterprises, but focuses on establishing an institutional ecosystem that enables the private sector to maximize its capabilities. Enterprise success derives not from special privileges, but from fair, transparent, and stable rules of the game. At the same time, regarding the private economy as the most important driving force also requires a shift in managerial thinking. Private enterprises are not objects to be “strictly controlled,” but development partners. The relationship between the State and enterprises must move from “ask–grant” to “accompaniment–cooperation,” from “control” to “responsible support.”
In the long term, the growth of the private sector is itself a measure of the effectiveness of institutional reform. A sound legal system will generate strong enterprises capable of competing regionally and globally. Conversely, if reform remains confined to documents without substantively improving the business environment, the private sector will struggle to achieve breakthroughs, and the economy will lack endogenous growth drivers. From this perspective, the direction of the General Secretary on private economic development is closely linked to the requirement to renew legislative thinking and to build a rule-of-law, developmental, and service-oriented State. This forms a unified whole: law lays the foundation, institutions open the way, enterprises create value, and society benefits from sustainable growth.
When the future becomes the "raw material" of policy
One of the prominent points in the direction of General Secretary To Lam regarding law-making is the requirement to “attach importance to and proactively conduct early strategic and policy research, grounded in practice and international experience, thereby enhancing foreseeability and improving the quality of law-making.” This constitutes a clear affirmation of the role of anticipatory thinking in modern national governance. In a context where science and technology are developing rapidly, business models are continuously evolving, and global risks are becoming increasingly complex, the law can no longer operate according to the logic of “addressing issues only after they arise.” A legal system that consistently lags behind practice increases social costs, constrains innovation, and undermines national competitiveness. Therefore, building the law today is, in essence, designing the development space for the next ten or twenty Anticipatory thinking in institutional development is not subjective speculation, but a systematic process of studying technological trends, market fluctuations, geopolitical shifts, demographic changes, and transformations in social behavior. On that basis, the law is designed to be open, flexible, and adaptive, rather than rigid and short-term. This constitutes the foundation of strategic governance in the modern State. Associated with anticipatory thinking is the viewpoint of building laws in a framework- and principle-oriented manner, granting flexible authority to implementing agencies. When the law focuses on core values and foundational standards, while technical matters are regulated flexibly, the legal system can remain both stable and responsive to change. This approach helps limit the need for constant legal amendments and reduces policy risks for investors and society. On the basis of such anticipatory thinking, the direction of the General Secretary reflects the formation of a convergent governance model, harmoniously combining three modern State models: the rule-of-law State, the developmental State, and the service-oriented State.
First, the rule-of-law State constitutes the institutional foundation. All management activities must operate within the framework of the Constitution and the law, ensuring human rights, citizens’ rights, transparency, and accountability. This is the condition for controlling power and maintaining social stability.
Second, the developmental State provides the driving force for growth. Instead of directly intervening in economic activities, the State focuses on policy design, infrastructure development, human resource development, and the removal of institutional barriers. The State’s role shifts from “substituting” to “opening the way” for the market and enterprises.
Third, the service-oriented State represents human-centered governance. The public apparatus is oriented toward serving the lawful needs of the people and enterprises, regarding social satisfaction as a measure of managerial effectiveness. This forms the foundation for building institutional trust and consolidating the State’s soft power.
The distinctive feature in the General Secretary’s directive thinking lies in not separating these three models, but organizing them into a unified whole. The rule of law provides the framework; development facilitation generates momentum; service orientation builds consensus. The absence of any one of these elements would render the governance system unbalanced: the rule of law without development facilitation may become conservative; development facilitation without the rule of law may lead to arbitrariness; service orientation without discipline may undermine regulatory effectiveness. The convergence of these three modern State models reflects a maturation in national governance thinking: a transition from linear management to multidimensional governance, from administrative control to development coordination, and from passive reaction to proactive future-shaping. In the long term, anticipatory thinking combined with a convergent State model will determine the quality of institutions and the sustainability of Viet Nam’s development. When the law is designed on the basis of long-term vision, and when the apparatus operates according to the principles of the rule of law, development facilitation, and service orientation, institutions will not only meet present requirements but also become a strategic advantage in global competition.
Conclusion
It can be seen that the objectives of taking the people and enterprises as the center, substantively ensuring fundamental economic rights, developing the private economy, enhancing anticipatory capacity, and building a convergent State model do not exist as separate goals. They constitute a unified institutional ideology aimed at maximally liberating internal social resources within the framework of the rule of law. When the law generates trust, when institutions encourage innovation, and when the public apparatus genuinely serves, development momentum does not require external “stimulus,” but is formed sustainably from within society itself. A modern, stable, and predictable legal system is the most important “soft infrastructure” of development. It forms the foundation for attracting talent, retaining investment capital, nurturing enterprises, and establishing high value-added value chains. However, correct thinking becomes effective only when it is seriously institutionalized and consistently implemented. The greatest challenge today lies not in the absence of policy orientations, but in the capacity to translate reform thinking into concrete action - from the central level to the local level, from legal documents to practice. If “institutional lag” and “administrative inertia” are not overcome, progressive orientations may easily be eroded in the course of implementation. At a deeper level, legal reform in the spirit directed by General Secretary To Lam is not aimed solely at generating economic growth, but at building a governance system grounded in trust, responsibility, and long-term values. It is a model of governance in which the people trust the law, enterprises trust the business environment, and the State trusts the creativity of society. Law is built for today, but in preparation for generations to come. Each statute, each policy, and each institutional reform contributes to shaping the country’s development space for decades. For that reason, legislative thinking with a long-term vision, centered on human beings and oriented toward sustainable development as the ultimate objective, is not merely a managerial requirement, but a historical responsibility toward the future of the nation.
