Over half of SMEs don’t know law to support SMEs

Deputy Tran Thi Dieu Thuy said that departments and agencies necessarily assess bottlenecks in the coordination between them because more than 50 percent of small and medium enterprises do not even know about the law to support SMEs.
Over half of SMEs don’t know law to support SMEs ảnh 1 At the meeting

The Ho Chi Minh City National Assembly Delegation yesterday held a survey on the implementation of the Law on Supporting Small and Medium Enterprises in HCMC from January 1, 2018, to June 30, 2022.

According to the Department of Planning and Investment, as of June 30, 2022, the southern largest city had 264,407 small and medium enterprises, accounting for 97.5 percent of the enterprises in the city. The number of newly established small and medium enterprises in this period was more than 184,000, but more than 128,000 firms were also temporarily dissolving at the same time accounting for nearly 70 percent. The industries with the largest number of newly registered enterprises include wholesale, retail, repair of cars and motorcycles (accounting for 37.2 percent), science and technology, consulting services, design, advertising, and other expertise.

The Department of Planning and Investment assessed that several policies such as the price stabilization program, bank-enterprise connection, supply-demand connection, and the program 'Vietnamese people using Vietnamese products' have well affected small and medium enterprises,

However, the Science and Technology Development Fund, the Credit Guarantee Fund for Small and Medium Enterprises, and the Science and Technology Development Fund set up at enterprises have not been effective.

The Department of Planning and Investment also announced that its inspectors have paid unscheduled visits to businesses even though the Prime Minister has instructed state agencies not to inspect enterprises more than once a year for fear that inspection will affect the production and business activities of enterprises. Inspectors check not only on fire prevention and the environment but also checks from goods, permits, labor, invoices, and documents; sometimes, inspectors negotiate how to remedy the situation.

Le Huynh Minh Tu, Deputy Director of the HCM City Department of Industry and Trade, mentioned the Department’s biggest difficulty during the implementation of the Law on Supporting Small and Medium-sized Enterprises. The Ministry of Finance was asked to guide tax administrative procedures and accounting regimes for super small businesses as well as allocate resources to support businesses. The Ministry of Industry and Trade guides enterprises to participate in product distribution chains. The Ministry of Science and Technology guides the establishment of incubators, technical facilities, and co-working areas, and the Ministry of Natural Resources and Environment guided localities to arrange land funds. However, the above ministries have not yet issued specific instructions for implementation, leading to confusion for the Department of Industry and Trade when formulating plans and funding projects to support small and medium enterprises.

Deputy Director of Ho Chi Minh City Department of Finance Phan Thi Hong said that the Credit Guarantee Fund for Small and Medium Enterprises in Ho Chi Minh City had given financial and legal advice for businesses; plus, it has helped to complete documents for 94 firms which asked for a total loan of more than VND 5,900 billion and 26 of them were granted loans with a credit limit of nearly VND 2,400 billion.

The Department of Finance of Ho Chi Minh City proposed to the Ministry of Finance and relevant ministries to guide the purchase of risk insurance for credit guarantee activities to ensure the safety of the Credit Guarantee Fund. Additionally, the Ministry and related agencies should have specific guidance on the development of corporate credit rating regulations to serve as a basis for granting credit guarantees to enterprises and specific instructions on the minimum value of the customer's collateral required at the Guarantee Fund for loan guarantees.

Director of Ho Chi Minh City Department of Labour, Invalids and Social Affairs Le Van Thinh said that the recent implementation of policies to support small and medium-sized enterprises was slow, due to the awareness of businesses.

Many National Assembly deputies said that, in addition to the delay in the guidance of ministries and sectors, HCMC administrators didn’t report the bottleneck to the government soon.

Speaking at the meeting, Deputy Head of the Ho Chi Minh City National Assembly Delegation Ha Phuoc Thang highly appreciated agencies’ efforts in supporting small and medium enterprises in difficult conditions due to the lack of guidance from the central government.

Mr. Ha Phuoc Thang suggested that departments and agencies should voice their opinion to the municipal People's Committee on drafts and recommendations to the Central Government so that ministries and related units can soon provide guidance. In addition, the Ho Chi Minh City Business Association also needs to strengthen relationships with ministries and agencies of the city, to inform businesses about support policies more fully.