Tuesday, May 21,2024 - 4:22 GMT+7  Việt Nam EngLish 

New growth drivers needed for businesses 

 Tuesday, April 23,2024

AsemconnectVietnam - 2024 is considered a pivotal year for Vietnam's economy to accelerate and make a breakthrough.

Although Vietnam's economy has been assessed to have many bright spots in recent times, in reality, production and business activities of businesses are forecast to still face difficulties when the access to capital is not effective, and the demand in markets around the world continue to decline.
Identifying bottlenecks, promoting and taking advantage of old growth drivers and finding new growth drivers is very important to improve competitiveness and bring the country's economy forward in the new period.
Businesses are still facing difficulties
According to a recent report from the General Statistics Office (Ministry of Planning and Investment), although Vietnam's economy has many bright spots, the business community is still facing difficulties. In the first quarter of 2024, the whole country had 59,900 newly registered businesses and returned to operation, an increase of 5.1% over the same period last year. On average, each month there were nearly 20,000 new businesses established and returned to operation; However, there were also 73,900 businesses withdrawing from the market, much higher than the number of newly established businesses, up by 22.8% over the same period last year. On average, each month there were nearly 24,700 businesses withdraws from the market.
According to statistics, currently, 52% of businesses say they are lacking orders; 32% lack access to capital; 25% think that administrative procedures are still cumbersome. In addition, some businesses are concerned about increased criminalization of economic activities and a shortage of high-quality personnel in the information technology industry. In addition, although the Law on Support for Small and Medium Enterprises was promulgated in 2018, up to now, the small and medium business community evaluates that localities have not implemented it effectively.
“We hope that the Government should quickly remove bottlenecks and legal barriers that are hindering business investment activities of businesses, allowing businesses to defer and delay payment of taxes; continue to deploy policies and solutions to support businesses in digital transformation, science and technology application, innovation, etc.," Mr. Mac Quoc Anh recommended.
Recently, the world economy has continued to face many difficulties and challenges, as most economies have had lower growth than expected due to declining aggregate demand. At the same time, Vietnam's major partners are facing high public debt, making the growth prospects of these countries not too positive and this will affect Vietnam's economic growth prospects.
Therefore, with a spirit of determination and urgency, right in the first days of 2024, the Prime Minister issued Resolution No. 01/NQ-CP and Resolution No. 02/NQ-CP to set out many tasks, an important solution with the goal of not only supporting businesses to recover and promote growth but also seeing this as the key to renewing traditional growth drivers (investment, export, consumption) and opening up new growth drivers (science and technology, innovation, digital transformation, green transformation, emerging industries and fields such as semiconductor chips, etc.) in 2024. It can be said that dynamic growth momentum has become both an urgent and long-term strategic requirement for businesses and the economy this year and in the years to come.
Institutional reform must be more drastic
Currently, Vietnam is considered to have been relatively successful in maintaining macroeconomic stability, ensuring major balances, as well as social security after Covid-19. These are important foundations to promote quality and sustainable economic growth in the future. However, it must be determined that transforming the growth model according to new development dynamics is a process of transformation in thinking, awareness and action.
Over the past four years, since the Covid-19 epidemic broke out, it is good that Vietnam has had the foundations for "thinking innovation" when the National Assembly and the Government have been very determined to accompany and solve many institutional barriers, promulgate practical support policies to expand economic space, reduce unnecessary costs for production and business activities of enterprises. Thanks to that, Vietnam is highly appreciated by the international community for its reform thinking.
However, currently many legal documents and regulations are still in the process of being completed, causing difficulties in organizing and implementing them. Therefore, to promote new growth drivers, according to Dr. Tran Thi Hong Minh, Director of the Central Institute for Economic Management Research (CIEM): Vietnam needs to be more drastic in institutional reform, because institutions are also a resource. The key is that ministries, branches and localities need to continue to reduce and substantially simplify administrative procedures, business regulations, and compliance costs.
Along with that, it is necessary to create a driving force for linkages between localities and businesses according to value chain thinking to cooperate and develop together, focusing on removing difficulties in accessing export markets, facilitate trade, encourage market diversification, and effectively find and exploit niche markets. To effectively access the world market, businesses also need to strengthen their capacity, cooperate, and support each other.
Accordingly, the state needs to continue to improve institutions, policies, and laws, ensuring consistency, synchronization, fairness, transparency, and non-discrimination between businesses, thereby regaining and build trust for the business community. At the same time, businesses themselves must also reflect on themselves and strengthen their management and financial capacity to increase competitiveness and meet market requirements. This will be an important tool to help businesses maintain old growth drivers and find new growth goals, contributing to the recovery and development of production and business activities in the coming period.
Source: VITIC/nhandan.vn


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