Determining the level and roadmap in implementing policies to support businesses: VCCI

As proposed by the VCCI, the development and implementation of policies should be determined according to the appropriate implementation level and roadmap. Photo: H.Diu

Businesses can only hold out for a maximum of six months

Speaking at the Prime Minister's online conference with the business community and localities on solutions to continue supporting businesses in the context of Covid-19 on the morning of September 26, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Pham Tan Cong said that the economic development goals of the country and enterprises are facing unprecedented challenges. So more than ever before, the support and companionship of the Government are desperately needed for the business community to overcome this difficult moment.

Citing a report summarizing recommendations from businesses and associations of VCCI, Mr. Pham Tan Cong said that only about 30% of seafood processing and exporting enterprises in southern provinces and cities are still operating thanks to ensuring “3 on the spot” requirements, but they are coping with difficulties because of skyrocketing costs and can only mobilize 30-50% of the workforce. As a result, the capacity is reduced to only 40-50%. Over 50% of wood industry enterprises in the Southeast region have stopped production and are facing the risk of bankruptcy.

According to feedback from business associations of export-related and labor-intensive industries, only 15 to 20% of manufacturers are working in moderation because they can afford “3 on the spot" expenses, the remaining 80-85 % of factories had to stop production. 90.8% of enterprises have reduced their labor processes during the pandemic.

As showed in the survey on the tolerance of Vietnamese enterprises to the prolonged state of the disease and social distancing, even a typical enterprise can only endure for a maximum of 6 months, of which the lowest ones belong to the agricultural, forestry and fisheries sectors (average 4.7 months), information communication (4.9 months) and construction (5.3 months).

"The fourth wave in Vietnam is complicated, deep, and widespread and unfeasible to return to the "Zero Covid" state. Therefore, if social distancing continues, businesses will collapse. Now things are different, so it is high time to set up a new mindset, a new perspective, a new strategy, a new way of doing things,” said the VCCI Chairman.

Supporting roadmap is necessary

Agreeing with the Government's view on pandemic prevention and economic development, according to the Chairman of VCCI, the business community has proposed two new policies.

Firstly, it is necessary to recognize enterprises as a subject in Covid-19 response, thereby trusting them to equip and improve on-site medical capacity for businesses.

Secondly, the Government should issue policies to resolutely protect and support the maintenance of safe production and business activities in order to live with Covid-19.

With the view that businesses are a subject in the fight against Covid-19 and a key force on the economic front, and at the same time with the determination of long-term coexistence with the pandemic, the business community have proposed to the Prime Minister to include representatives of the business community in the structure of the Covid-19 prevention and control steering committees at all levels.

Specifically, businesses asked the Ministry of Health, the Ministry of Information and Communications, and the Ministry of Public Security to urgently study and perfect the "Covid-19 Green Card" system, unify to use one platform/app which links data communication between relevant ministries and branches; adjust the regulations on entry, work permits to create stable conditions for labor force, experts and foreign workers working in Vietnam.Along with that, in order to maximise the effectiveness of the Government's support policies, Mr. Pham Tan Cong mentioned that the development and implementation of policies should be determined according to the level and appropriate implementation roadmaps such as: urgent solutions that need to be implemented immediately; recovery support solutions; solutions for restructuring, sustainable development in the medium and long term.

Given solutions to ensure safe production and business, the VCCI Chairman suggested that the Government and National Assembly promptly research, develop and promulgate new policies and regulations, including laws, to proactively avoid the risk of outdated policies becoming a bottleneck for business operations in the new normal.

For policies to support business recovery, the business community asked the Government to direct relevant ministries, sectors and agencies to urgently issue documents guiding the exemption and reduction of taxes, fees, electricity and water bills and implementing measures mentioned in Resolution 105/NQ-CP. Promoting digital transformation, requesting ministries, branches and localities to increase at least 30% of current administrative procedures carried out electronically and without contact; shortening the prescribed time limit  for these procedures by one third.

Regarding mid- and long-term solutions, according to Mr. Pham Tan Cong, it is necessary to develop restructuring policies right now towards sustainable development such as: improving the business environment, boosting public investment, digital transformation and development of the digital economy, speeding up the reform of import and export procedures and making good use of opportunities from free trade agreements (FTAs).

The business community asked the State Bank to continue issuing stronger support policies such as extending credit limit s; tax exemptions and reductions, preferential loans at low interest rates, raising the collateral limit  to increase the value of working capital from 70% to a higher level. "The fact that banks still gain great profits while businesses stagnate in production and business is an unhealthy indicator of the economy and of the symbiotic relationship between banks and businesses," the VCCI Chairman said.