HCM City needs to speed up economic restructure and diversify its markets to recover from the slump caused by COVID-19, according to experts. VNS Photo Văn Châu

HCM CITY – Most business activities have resumed in HCM City after a long hiatus caused by the COVID-19 outbreak, but experts said government support is needed to revive the economy.

Chu Tiến Dũng, chairman of the HCM City Union of Business Associations, said the city's main sectors like rubber, plastics, supporting industries, wood products, textiles, and footwear have been hit hard due to the disruption of supply chains, labour and markets.

The city government has announced many support policies related to corporate income tax, value-added tax and personal income tax to help businesses stay afloat, he said.

Others include cutting bank lending interest rates, deferring repayment of loans and reduction in social insurance and health insurance premiums for employers, he said.

But many businesses are finding it difficult to access the city’s VNĐ250 trillion (US$10.7 billion) stimulus package meant to support those affected by the pandemic, especially small- and medium-sized enterprises, he said.

The procedures are complicated and official agencies are not providing guidance, he quoted businesses as saying.

The city should continue with administrative reforms, and foster the use of information technology to enable businesses to access financial support, Dũng said.

It should help stabilise and restructure markets, expand the domestic market and prepare for exports when other countries end social distancing, he said.

Besides, it should help businesses set up supply chains with domestic firms and support investment in agricultural processing to replace raw agricultural exports with that of processed items, he said.

Banks should lend to supporting industry enterprises for investment in infrastructure and technological innovation, he said.

Transactions between businesses and authorities and administrative procedures should become digital, and e-governance and smart applications should be adopted, he said.

The city needs to offer incentives and perfect the legal framework to persuade enterprises to go digital, he added. – VNS