Binh Duong to support SMEs with digital transformation

Thousands of small and medium-sized enterprises in Binh Duong will receive support to effect digital transformation from the province People’s Committee and Ministry of Planning and Investment.

According to Vice Chairman of the People's Committee Nguyen Van Danh, there are over 57,000 enterprises in the province, of which SMEs account for more than 97%.

When the COVID-19 pandemic hit, over 90% of SMEs were severely affected as the traditional market and production shrank.

SMEs need digital transformation tools to change the way they operate and do business in the new environment.

The pandemic has created a labour shortage besides hitting demand, and after it passes SMEs need to increase the use of digital technology to survive and function efficiently.

Digital transformation is the integration of digital technology into all areas of a business that results in fundamental changes to the way it operates.

This is the right time for SMEs to adopt technology in management and make the digital transformation, and so it is essential to quickly have policies to help them overcome difficulties and resume operations, especially to make the transformation, experts say.

Danh said to persuade firms to embrace digital transformation, the province administration would create a legal framework to help them innovate and avoid possible legal risks.

The experts say policies that encourage enterprises and create conditions for them to adopt new technologies and digital transformation are needed, especially those that allow the testing of new products and technologies that still face legal obstacles.

The province needs to foster the development of large technology companies, raise awareness in society about the benefits of digital transformation and digital technologies and set basic standards for digital transformation to help businesses mitigate the risks involved, they say.

It needs to invest in technology infrastructure that only it could and adopt policies to encourage and support creative start-ups and develop human resources for digital transformation.

The US Agency for International Development (USAID) along with the Ministry of Planning and Investment and Binh Duong province is set to implement a programme called USAID Linkages for Small and Medium Enterprises to improve supply chain links for SMEs and the ability of business associations to support the development of SMEs.

It seeks to enable systematic changes in the business environment from reforming institutions and simplifying administrative regulations and procedures to reducing the cost of implementing administrative procedures to improve the competitiveness of businesses, helping improve their ability to integrate internationally including the global SME value chain.

While FDI in Vietnam had reached historic levels, the spillover benefits for the domestic economy were affected by the limit ed supply chain linkages of Vietnamese SMEs, according to USAID.

The programme aims to address this gap by strengthening the capabilities of intermediary organisations in Vietnam, such as business associations, export development centres and SME promotion agencies, to facilitate the supplier-buyer relationships between Vietnamese SMEs and lead firms located in Vietnam and expand Vietnamese SMEs’ capacity to participate in manufacturing supply chains.

Binh Duong has 403 foreign-invested projects worth over 6.8 billion USD. /.