The number of businesses entering the market in the first 8 months of this year was greater than the number of businesses withdrawing, but since the beginning of the year, 135,300 businesses have "stopped playing".
“This shows that production and business activities still face many difficulties,” commented Dr. Nguyen Minh Thao, Head of the Department of Business Environment and Competitiveness Research (Central Institute for Economic Management, Ministry of Planning and Investment) .
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| Dr. Nguyen Minh Thao, Head of the Department of Business Environment and Competitiveness Research (Central Institute for Economic Management, Ministry of Planning and Investment). |
In the first 8 months of this year, there were about 168,000 businesses entering and re-entering the market. Madam, is this a good sign?
According to data just released by the General Statistics Office, since the beginning of the year, nearly 111,000 new businesses have been established. If we include the number of businesses returning to the market after a period of suspension for various reasons, then in the first 8 months of this year, there were over 168,000 businesses entering and re-entering the market, an increase of 12.5% over the same period in 2023.
These are very impressive and encouraging numbers, both in terms of quantity and growth rate.
But during the same period, 135,300 businesses left the market. Thus, minus this number, only 32,700 production and business establishments were added in the first 8 months of the year, an increase of only about 4,100 establishments per month.
Before Covid-19, the number of businesses entering the market was often much higher than the number leaving the market. At times, this difference was 2-3 times. However, since the pandemic broke out, the number of businesses entering and leaving the market has been similar at many times, or the difference is not significant, and at times, the number of leaving is even higher than the number of new businesses establishing and re-entering the market. This shows that production and business activities still face many difficulties.
According to statistics, businesses that have stopped, temporarily stopped, or dissolved are mainly small and micro businesses operating in the fields of wholesale, retail, services, restaurants, etc. What is your opinion on this?
It is true that businesses that are dissolved, stopped, or temporarily suspended operations are mainly in the service sector, concentrated in the commercial sector (wholesale, retail), accommodation, catering, and restaurant services; motor vehicle repair... and most of them have very small capital, mainly under 10 billion VND. Many people believe that these establishments dissolving or ceasing operations will not have much impact on the economy. But I think this assessment is not correct, because in the operation of society, every industry, field, production, and business activity is necessary.
Moreover, this sector is attracting a large informal workforce. According to the General Statistics Office, the number of informal workers in the second quarter of 2024 was 33.5 million, accounting for 65.2% of the total employed workforce, an increase of 271,700 people compared to the previous quarter and an increase of 210,300 people compared to the same period last year. As the number of businesses and even households and individuals doing business in the service sector, restaurants, wholesale, retail, etc. increasing, it means an increase in the number of workers in the informal sector losing their jobs, an increase in the number of people losing or having their income reduced, causing their families to also face difficulties.
In fact, production and business activities are gradually improving since the third quarter of 2023. In your opinion, why are small, micro-enterprises, and household businesses still facing difficulties?
The situation of restaurants and stores hanging signs "rental premises" and "liquidation" in urban areas is very common, especially in Hanoi and Ho Chi Minh City, showing that business activities are very difficult. The reason, in my opinion, is partly due to the impact of Decree No. 100/2019/ND-CP regulating administrative sanctions in the field of road traffic; Law on Prevention and Control of Harmful Effects of Alcohol and Beer and documents guiding its implementation.
When the authorities thoroughly implemented these two regulations, not only did the revenue from alcohol and beer sales in restaurants, hotels, and entertainment areas decrease sharply, but the accompanying services and related activities such as transportation also decreased, forcing businesses, households, and individuals doing business in this field to stop operating, dissolve, and close after a period of being unable to hold on. Businesses, households, and individuals who intended to invest in this field also gave up their intention.
I think the service sector will face even more difficulties, and the number of dissolved, closed, and bankrupt businesses will increase even more if the National Assembly passes the Law on Special Consumption Tax as proposed by the Ministry of Finance on increasing taxes on alcoholic beverages and sugary soft drinks.
But madam, are the above policies aimed at protecting consumers and protecting people's health?
That does not mean I do not support Decree 100/2019/ND-CP; Law on Prevention and Control of Harmful Effects of Alcohol and Beer and the imposition of special consumption tax on sugary soft drinks and increased tax on alcohol and beer.
In fact, the fines for people who drink and drive in Vietnam are much lighter than in many other countries. The special consumption tax on cigarettes, alcoholic beverages, and soft drinks in Vietnam is also much lower than in many other countries.
The question is, why do countries with high taxes and heavy penalties still have businesses that thrive, restaurants, hotels, and entertainment venues that operate effectively, while in Vietnam it is the opposite? The key is that the old mechanisms and policies to encourage investment and business that were once effective are no longer suitable for the new context, while we do not have new policies.
Source: https://baodautu.vn/so-luong-doanh-nghiep-gia-tang-nhung-kho-khan-van-con-d224323.html
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