Ms. Nguyen Minh Thao, Head of the Business Environment and Competitiveness Research Department (CIEM), said that statistics show that the strength of businesses is becoming increasingly depleted after more than two years. years of struggling to maintain operations after COVID-19 and cope with difficult external factors.
Businesses are increasingly depleted
According to data from the General Statistics Office, in the first 2 months of 2024, the whole country had 41,100 newly registered businesses and returned to operation. In contrast, the number of businesses withdrawing from the market in 2 months is 63,000 businesses. This number partly reflects the health of businesses as the number of businesses withdrawing is greater than the number newly established.
Commenting on the number of businesses leaving the market is higher than the number of newly established businesses, Ms. Nguyen Minh Thao - Head of the Business Environment and Competitiveness Research Department (CIEM) said that, normally, the number of newly established businesses and return to activity at the beginning of the year is often lower than the months in the middle of the year and at the end of the year because it falls in the Tet months with a long number of days off.
Although lower than other periods, the number of businesses entering the market is always greater than the number of businesses withdrawing. Therefore, the phenomenon of businesses withdrawing is suddenly high, more than businesses entering the market with a reverse trend compared to before.
This shows that businesses' strength is becoming increasingly depleted after more than two years of trying to maintain operations after COVID-19 and cope with difficult external factors.
“Since COVID-19, the difficulties of businesses have never ended, such as difficulty in output, high prices of raw materials, high-interest rates... By 2024, these difficulties will not only affect businesses. small businesses, but also affects even large-scale businesses," Ms. Thao stated.
Sharing the same opinion, Mr. Dau Anh Tuan - Deputy Secretary General and head of the Legal Department of the Vietnam Confederation of Commerce and Industry (VCCI) also said that, through annual monitoring, the number of businesses leaving the market in the quarter I is usually higher than the remaining quarters because it is the end of the fiscal year so businesses consider whether they still have enough financial capacity to continue operating or not.
However, compared to the last months of 2023 (each month about 11,000 - 12,000 businesses are withdrawing from the market), the number of businesses withdrawing in the first two months of this year reached 31,500 businesses, more than twice as many. This shows that the difficulties of the economy in 2023 have not subsided but will still last into 2024.
Tax and fee support policies should be extended
Negative signals were also predicted in advance when, according to a survey from the end of 2023 of the Private Economic Development Research Board (Division IV), up to 82.4% of businesses rated it negatively/very strongly—negative economic situation.
“Conflicts between countries and problems in relations between countries have been affecting the Vietnamese economy in general and the business community in particular. Currently, many Vietnamese industries are facing difficulties due to transportation. Crossing the Red Sea is risky, many cargo ships are diverted, so delivery times are prolonged and costs increase," Mr. Tuan is concerned.
In its survey, Board IV emphasized that business exhaustion is true and that the business's strength will be exhausted if not nurtured in time. Therefore, 2024 is the time to continue to strengthen the strength of people and businesses more than ever to nurture the confidence and recovery capacity of businesses as well as the overall economy.
Mr. Dau Anh Tuan said that to support businesses in the context of many uncertainties in the world, the National Assembly and the Government need to continue to research policies to support people and businesses, especially when these policies need to be implemented. It must be stable and convenient to access.
VCCI leaders proposed that one of the policies that need to continue to be implemented this year is to extend tax and fee support policies such as continuing to extend the 2% value-added tax reduction until the end of the year because this is an important and highly effective policy that not only supports consumers through tax reduction but also helps vibrant production and business.
“For support policies on tax and fee reduction, businesses can easily access them immediately, while capital support policies, if not substantive, have little pervasive impact. This is a lesson for us to design policies for businesses in 2024," Mr. Tuan stated.
(Vietnam finance)