Many small enterprises hit the wall

For the first four months of this year, 3,249 small enterprises have closed their business, and 19,000 others temporarily stopped operations, a survey conducted by the Vietnam Chamber of Commerce and Industry (VCCI) has found. 

Most of the companies had under 10 billion VND (480,000 USD) of registered capital. 

The number of enterprises temporarily stopping operation increased by 4.5 percent, though the number of enterprises closing fell 0.8 percent compared with last year. 

“The development of small- and medium-sized enterprises (SMEs) is very important for any economy and if SMEs can’t develop, the Vietnamese economy will find it hard to grow in a sustainable way,” Nguyen Hoang, president and CEO of N&G Corp, was quoted as saying by Dau Tu (Vietnam Investment Review) newspaper. 

“The economy cannot only be based on big State and private corporations, but must also include SMEs,” he said. 

SMEs face a sharp decline in turnover and profit, and fewer qualified human resources, while big corporations have experienced business recovery and are recruiting more staff. 

More than 60 percent of very small enterprises and 50 percent of small enterprises cannot reach their target for their annual turnover. For medium and big enterprises, the figures are 45 and 47 percent, respectively. 

“The size of enterprises has affected business efficiency,” Hoang said. 

The Consulate General of Vietnam in Osaka, Japan organised a workshop for Japanese businesses from the Kansai region on investing in Vietnam. 

The workshop was coordinated by the Kansai Bureau of the Economy, Trade and Industry, the Japan-Vietnam Business Support Centre, and the Japan-Vietnam Friendship Association in Sakai, among others. 

A representative from the Kansai Bureau of Economy, Trade and Industry stated that Japanese firms consider Vietnam as a top investment destination. 

More than 120 participating enterprises learned about the trade ties between Vietnam and Japan, the Vietnamese economy and relevant policies. 

They commended Vietnam for its business climate and investment opportunities during the formation of the ASEAN Economic Community, as well as its active role in establishing multilateral free trade agreements, such as the Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership. 

They spoke highly of the revised laws on investment and enterprise establishment that will take effect on July 1. 

Business leaders expressed their hope for continuous support from the Vietnamese Government, particularly in accelerating investment licensing process. 

The Japanese business community suggested the Consulate General of Vietnam launch additional sector-specific workshops on agriculture, human resources and real estate. 

The southern-central Kansai region includes the prefectures of Osaka, Mie, Nara, Wakayama, Kyoto, Hyogo and Shiga.-VNA ( 2015年6月2日)