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VietNamNews

Ride economic recovery to market success, SMEs urged

Update: January, 28/2015 - 08:33
Workers make small motors at a factory run by the Mabuchi Motor Viet Nam Co. in Dong Nai Province. Small and medium–sized enterprises have been urged to improve their competitiveness to grab opportunities thrown up by the emerging economic recovery. — VNA/VNS Photo Danh Lam

HA NOI (VNS) — Small and medium–sized enterprises (SMEs) have been urged to improve their competitiveness amid rapid global integration, to grab opportunities as signs of economic recovery are already emerging in 2015.

Bui Thu Thuy, deputy director of the Agency for Enterprise Development under the planning and investment ministry, said at a conference held by the Viet Nam Chamber of Commerce and Industry yesterday that SMEs would continue to struggle this year, despite their large contribution of 50 per cent of the GDP.

Thuy pointed out that SMEs were encountering problems of credit difficulties, small capital scales, outdated technologies and weak management capacity, despite their large contribution to the economy in the 2009-12 period.

She said that most domestic firms were of small scale, while pointing out that medium-sized enterprises in the private sector account for just 1.6 per cent. In addition, SMEs failed to keep pace with technological innovations, while the government's support remained limited.

She added that enterprises should also improve technologies and boost technology transfer to enhance quality, productivity and competitiveness, coupled with the government's support to encourage SMEs to participate in the supply chain.

The restructuring of the financial market, simplification of procedures and provision of preferential loans were also important measures to improve businesses' access to capital, Thuy said.

Vo Tri Thanh, deputy director of the Central Institute of Economic Management, said at the conference that the contribution of SMEs to the GDP of Viet Nam was lower than in several countries, while the advantages of participating in the global value chain remained limited due to low-quality technology and management capacity.

Thanh added that inflation was expected to be low this year, but difficulties remained and competition would intensify, especially with the formation of the Asean Economic Community, which would bring opportunities. However, in the long term, it would be critical for businesses to enhance their renovation capacity and competitiveness to seek higher added value.

At the conference, Nguyen Thi Thu Trang, director of the VCCI's WTO Centre, said that 2015 would be a year of preparation for new policies and a new stage of integration, with the negotiations for the new-generation free trade agreements (FTAs) to be concluded and signed.

Enterprises must understand clearly the opportunities as well as challenges arising from these FTAs in order to outline their strategies, Trang said. — VNS

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