100,000 businesses leave market, millions of families in difficulties

Most of the 100,000 businesses that have left the market in 2021 have been small and medium sized enterprises (SMEs), which has caused difficulties to millions of workers and their families.

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According to the Ministry of Planning and Investment (MPI), SMEs account for 98 percent of Vietnam’s total enterprises and create 5 million jobs. The enterprises use medium level technologies, create low added value, and use a lot of resources and labor. A high number of enterprises have been hit hard by Covid-19 over the last two years and they need prompt help.

MPI and USAID are developing a project – LinkSME – that connects SMEs, improves their capability, and helps them gradually get deeply involved in the global value chain.

The project has three pillars – connecting SMEs with leading enterprises in value chains, support for financial access, and digital transformation.

Le Manh Hung from MPI said thanks to LinkSME, a lot of orders have been connected, and dozens of training courses for hundreds of businesses have been organized to satisfy technical requirements set by the leading enterprises in the value chains. Businesses have been helped to access financial resources worth hundreds of billions of dong.

Nearly 100,000 businesses have accessed documents to improve awareness about digital transformation. More than 500 businesses have been assessed for readiness and 100 businesses have received in-depth consultancy to digitize.

Le Duy Anh, Director of Xuan Hoa JSC, said LinkSME sent specialists to reassess his company’s capacity, gave technical assistance, and helped to find clients and low-cost capital.

Anh said in the past he could not imagine what he needed to go digital. But now, he knows what the business needs to do and how many work items it needs to do so.

Dang Dinh Thinh from JAT Autoparts and Industry Equipment Production JSC said the enterprise, with support from LinkSME, is carrying out a model of a smart factory, creating opportunities to cooperate with foreign businesses and expand export markets.

His business has improved the quality of products, the management and finding of foreign customers. That is why the company has obtained more orders, while other businesses have fewer clients because of Covid-19.

In 2019, exports were 16.9 percent of the company’s turnover, while the figure rose to 19.7 percent in 2020 and 30.4 percent in the first nine months of 2021 to $13.6 million. Most products target the US and Canadian market.

Nguyen Thi Thanh Hoa, CEO of Eubiz, which has subsidiaries in Dac Nong, Binh Phuoc and Son La, and has distribution partners in the US, Europe and Australia, said that digital transformation has helped increase transparency, reduced costs, and increased competitiveness against Thai and Chinese enterprises.

Tran Thuy