VietNamNet Bridge - The statistics on the number of private businesses released by state management agencies vary.

According to GDT (General Department of Taxation), as of June 30, 2017, Vietnam had 596,713 operating businesses, an increase of 28,945 businesses, or 5.1 percent compared with December 31, 2016

However, the Ministry of Planning & Investment (MPI) gives other figures.

A report of GSO, an arm of the ministry, released in late April said by December 31, 2015, there were 442,485 businesses, with the number of businesses in 2000-2015 increasing by 17.6 percent per annum. The growth rates were 21.8 percent in 2000-2010 and 9.6 percent in 2010-2015.

Meanwhile, according to the Administration of Business Registration, also belonging to MPI, 110,000 new businesses were set up in 2016, an increase of 16.2 percent over 2015.

According to the agency, in the first six months of the year, Vietnam had 61,276 newly registered businesses, while 15,379 businesses returned to operation, which means that the total number of newly set up businesses and the businesses resuming operation were 76,700.

According to GDT, as of June 30, 2017, Vietnam had 596,713 operating businesses, an increase of 28,945 businesses, or 5.1 percent compared with December 31, 2016

A research study conducted by the Central Economics Committee released recently showed that Vietnam has 535,920 businesses operating in accordance with the Enterprise Law, with a growth rate of 10.5 percent. At least 96 percent of them are privately run.

According to MPI’s Enterprise Development Agency, 98.6 percent of private businesses have small and medium scale, the majority of which are small and very small, while the number of medium sized enterprises account for 1.6 percent.

If classifying the businesses in accordance with the labor force scale, 97.7 percent of businesses would be small and medium, but in accordance with the capital scale, the figure would be 94.8 percent.

The average fixed asset of the enterprises is VND7-8 billion per business, a figure which has not changed in many years.

The performance of private businesses in Vietnam has been declining for more than a decade. In 2000-2014, the average number of workers decreased from 28.3 in 2000 to 18.4 in 2014. 

Meanwhile, the figures have increased from nearly 360 to 505 for SOEs and from 268 to 312 for FIEs.

While the average capital of every private business increased by eight times from VND3 billion in 200 to VND25 billion in 2014, SOE capital increased by 17 times, from VND126 billion to VND2.165 trillion and for FIEs by 2.3 times from VND157 billion to VND363 billion.

The Central Economics Committee noted that the increase in the investment capital of the private sector is not in line with the increase in productivity. The ROI of private businesses has decreased from 1.9 percent in 2010 to 1.2 percent in 2014, which is just equal to one-fifth of FIEs and half of SOEs.

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Thanh Mai