As many as 26,478 firms have been established in the first quarter of 2017, up 11.4% over the same period last year, showed data of the General Statistics Office (GSO).

New businesses in March alone number 12,027 with combined registered capital of VND118.7 trillion, up 120% and 90.6% month-on-month respectively, according to the data released by the GSO on March 29.

Startups in quarter one have total registered capital of 271.2 trillion (US$11.93 billion), up a staggering 45.8% compared to the year-earlier period. They have registered to hire a total of 291,500 employees, down 9.5% year-on-year.

Meanwhile, in the January-March period, more than 9,270 firms that had earlier suspended business have resumed operation, falling 1.1% from the same period last year.

Quarter one has seen year-on-year increases of 55% in startups and 31.1% in registered capital in the real estate sector. The respective rises are 28% and 79.7% recorded for education and training; 26.3% and 50.1% for finance, banking and insurance; and 15.8% and 21.9% for science-technology, consulting service, design and advertising.

The power, water and gas generation and distribution sectors have seen an increase of 32.5% in new businesses in the first quarter but their registered capital has plunged 40.8%. In the same situation are the agro-aqua-forestry industry with 16.4% and 17.7% respectively, and the transport and warehouse sector with 2.1% and 18.6%.

Nearly 3,270 firms have completed procedures for dissolution in the first three months, up 12% year-on-year. Almost 3,010 out of the total have registered capital of less than VND10 billion apiece.

According to the GSO, 20,636 businesses have suspended operation in the period, rising 3% from a year ago.

Upbeat about business

A GSO survey showed 33.7% of manufacturing and processing companies expected better business in quarter one than quarter four of 2016, some 41.8% hoped stable business and sales results, and 24.5% were concerned about difficulties. 

When asked about quarter two, 57.8% of respondents are looking to better performance, 32.4% are expecting stable business and sales, and only 9.8% are worried about tough times.

Enterprises pointed out a number of major factors impacting their production and sales in the first three months. According to the survey, 56.2% selected improved competitiveness of domestically-made products, 44.2% ticked low domestic demand, 34.5% pinpointed financial difficulties, 31.2% had difficulty recruiting employees, 27% claimed high interest rates, and 22.9% chose strong competition of imported goods.

Regarding production, 35.2% reported higher output in the January-March period, 39.2% obtained stability and 25.6% suffered a contraction. The corresponding proportions for quarter two are 58.2%, 33.5% and 8.3%.

The survey indicated 31% of respondents have received more orders in quarter one than the previous quarter, 46.1% have seen their orders unchanged, and 22.9% have faced a decline. More firms are optimistic about orders in the next quarter, with 51.2%, 40.1% and 8.7% respectively. 

In terms of export orders, 27% of respondents have got more orders in quarter one than the October-December period of 2016, 53.2% have registered same numbers, and 19.8% have had fewer orders. More firms are upbeat about the second quarter, with 38.8% expecting rising exports.

The survey revealed 28.3% of businesses have paid for more production costs this quarter compared to the previous one, 64.2% have had the costs unchanged, and 7.5% have reported a decrease. As for quarter two, 20.6% forecast an increase while 69.8% anticipate stable production costs.

About 18.2% of firms have sold products at higher prices in the three-month period, 73.8% have offered the same rates, and 8% have discounted their product prices. The corresponding proportions in quarter two are 18.8%, 75.1% and 6.1%.

The survey showed 19.4% of respondents have coped with higher product inventories in the first quarter, 51.7% have seen stability, and 28.9% have reported a fall. There are changes in the next quarter with 14.4%, 53.4% and 32.3% respectively.

Regarding employment, 16.1% of respondents said their payroll has expanded in the first quarter, while the number of employees has remained unchanged at 70.4% and inched down at 13.5%. The proportions in the April-June period are 22.2%, 71.4% and 6.4% respectively.

SGT