Policy support needed to boost business growth: Insiders
Policy support needed to boost business growth: Insiders
Without a more effective business support package, the country’s goal of 6.5 per cent in gross domestic product (GDP) growth for this year will be hard to achieve as growth in the first six months of 2021 is forecast to reach only 5.8 per cent, according to experts.
Nguyen Xuan Phu, Chairman of Sunhouse Group, said that like many other large firms, Sunhouse hoped to receive support in terms of policies rather than financial assistance.
The country currently has about 500 large-scale enterprises that contribute 60-70 per cent to the State budget, making it impossible to provide a common support package for all of them, noted Phu, stressing that policy support would be much more effective.
"Businesses need a smoother mechanism and more simple administrative procedures so that they can focus on production, as COVID-19 has created development opportunities for many firms," said Phu.
Meanwhile, Than Duc Viet, General Director of May 10, another big firm, said that the current support package had yet to help businesses overcome difficulties although many areas were eyeing opportunities due to recovering demand in the world market.
Viet said that in 2020, May 10 and other firms in the garment-textile sector faced difficulties in both input and sales. In 2021, the situation had changed completely with abundant orders.
About 90 per cent of the company’s products are exported to the US, the EU and Japan with orders enough for production until the end of this year, but without favourable mechanisms and policies to help businesses attract labourers and protect them against COVID-19, the firms will struggle to fill their orders, according to Viet.
Although the number of COVID-19 cases has exceeded 13,500, Viet Nam is still considered one of the most successful countries in the world in pandemic control.
Nguyen Duc Kien, head of the Prime Minister’s economic advisory team, said that Vietnamese firms were eyeing great opportunities in the world market as other large suppliers such as India, Bangladesh and Myanmar were struggling with the rising case numbers.
The current fiscal, monetary and social security support is no longer suitable for large firms, and it is necessary to design another support package with a focus on policy, according to Kien.
Kien added that it was a great chance for Viet Nam to increase foreign direct investment (FDI) attraction. Along with the effective control of the pandemic, it was crucial to design new and stronger support policies to promote economic growth and complete the target of at least 6.5 per cent GDP growth this year and the following years, stressed Kien.
Deputy Minister of Planning and Investment Tran Quoc Phuong said that the pandemic had changed the mindset of many big and strategic investors on the formation of a production hub to diversify supply chains and distributing the supply chains around the globe, including in Viet Nam.
According to Phuong, the support package for FDI companies cannot be the same as for small and medium-sized enterprises, but it is necessary to give breakthrough policies and mechanisms.
“We should not organise traditional roadshows or trade promotion events in other countries. So how we can persuade investors to pour a large amount of capital into Viet Nam without having to visit the country? To do so, we must give another support package with assistance in policies and mechanisms,” stated Phuong.
