U.S. offers over US$22 million to boost Vietnam’s SME growth
U.S. offers over US$22 million to boost Vietnam’s SME growth
The United States Agency for International Development (USAID) has offered US$22.1 million for a project to enhance business links with Vietnamese small and medium enterprises (SMEs).
The Government Office, the Ministry of Planning and Investment and USAID jointly held an event to launch the project, called USAID LinkSME, today, September 24.
Rolled out over five years until 2023, the project is expected to enhance the competitiveness of SMEs, reduce compliance costs, ease investment in SMEs and ensure supply chain integration. It is also aimed at promoting institutional reform and streamlining regulations and administrative procedures.
Rin Ashkin, director of the project, said that business links between SMEs and leading firms will bolster the economic competitiveness of the Indo-Pacific region and support USAID/Vietnam’s objective of expanding, with inclusive, market-driven and private sector-led growth.
Addressing the launch event, Minister and Chairman of the Government Office Mai Tien Dung said that the USAID LinkSME will create systematic changes for the local business environment.
Besides this, the project will lead to fundamental changes in the ability of local SMEs to integrate and connect with regional and global supply chains, said the minister.
The support for Vietnamese SMEs offered by this project will allow Vietnam to pursue sustainable development and attempt to escape the middle-income trap over the next few decades, he added.
Nguyen Chi Dung, Minister of Planning and Investment, hailed the USAID LinkSME project, noting that it will help the Vietnamese Government address existing obstacles confronting local SMEs, while encouraging these firms to actively tap into the global market.
Commenting on the current condition of local firms, he pointed out that they have made impressive changes over the past two decades thanks to the Government’s reforms. The country has over 730,000 active companies, with the number of SMEs accounting for over 97%.
Alongside a boom in the number of SMEs, these businesses have made a significant contribution to the nation’s economic growth and sustainable development by offering numerous jobs and improving the quality of life for employees, helping narrow the gap between the rich and poor and creating opportunities for investment in niche markets.
However, there are still some downsides seen among local SMEs, he added. As small-scale businesses, local SMEs are incapable of raising adequate funding, upgrading their technology or expanding their business operations.
Further, most local SMEs do not have good business management skills and have few highly skilled workers. Moreover, business links between SMEs or between SMEs and large firms remain poor.
