Unprecedented solutions to support businesses

Mr. Trinh Xuan An, full-time member of the National Assembly's Committee on National Defence and Security, a delegate to the Dong Nai National Assembly delegation.

How do you assess the current difficulties of the business community?

Businesses have never encountered such difficulties in nearly three years. This difficulty has not been solved yet, but other difficulties have followed it, so the steering ability of the business community to stay strong, as well as the support from Government agencies, were very remarkable, especially since the whole apparatus had to work very hard to run the economy.

Currently, the difficulties of businesses are related to many problems, not only the import and export market, the problem of input-output of goods but also the internal health and resilience of businesses. The health of the businesses could be stronger, while the capital considered their blood is difficult to access, so it is difficult to implement business strategies and restore production.

The report on the Government's socio-economic situation at this National Assembly session also stated that businesses were facing many difficulties in terms of market and capital flow. The market problem could only be solved after a period of time because it depended on the world context. Moreover, when the international market was difficult, businesses could turn to the domestic market.

Meanwhile, many comments on banking and credit issues were from the National Assembly deputies and have been issued many directions by the Government and the Prime Minister.

Currently, the State Bank has reduced the operating interest rate three times, the deposit interest rate in the market has decreased, but the reduction in lending interest rates and capital absorption for businesses still needs to meet the demand. The lending interest rate is still over 10%/year, excluding other costs, businesses cannot sustain. Therefore, the credit institution system must share the difficulties.

Facing the above difficulties, in your opinion, what should management agencies do?

All socio-economic influences are associated with businesses. The appropriate solutions for supporting businesses to recover and develop will help them return to paying high taxes, increase state budget revenue, and support workers with good incomes.

Meanwhile, the reality shows that the number of bankrupt businesses was larger than the number of newly established businesses, so all indicators of import-export, and budget revenue were affected.

It is necessary to have certain priorities for the business community, especially manufacturing businesses.

Previously, in the context that the whole economy had to fight the Covid-19 pandemic, the Government had submitted to the National Assembly for promulgation many unprecedented solutions and measures, so in the above difficult context of businesses, it is also necessary to have drastic solutions, if necessary, we can offer unprecedented solutions to support businesses.

For example, in terms of credit, the Government may require to reduce the lending interest to below 10%/year, helping businesses access capital and reducing the burden of interest expenses. Moreover, when providing credit, if businesses have many employees and make a large contribution to the budget, they can be approved loans quickly, reducing the criterion of no bad debt to lend.

Although it is true that the credit institution system must prevent risks, in certain times, we have to accept that it is better to save a business than to let a business die, so it can't be resuscitated.

In addition, the authorities can study to establish a financial fund to support businesses similar to the Covid-19 vaccine fund currently operating. These funds will help immediately support businesses in terms of capital, especially manufacturing enterprises, and improving the business environment and administrative procedures should also be directed drastically.

The export market is difficult, orders are reduced, there is a proposal that we should support businesses to return to the domestic market. How do you comment on this proposal?

Businesses cannot immediately turn 180 degrees from the export market to serve the domestic market. Therefore, this problem needs direct and indirect solutions to promote the market and stimulate consumer demand. We now have solutions to stabilize prices. In the near future, the National Assembly will approve a policy of reducing VAT by 2%, which will help stabilizing the market and stimulate people's consumption. Besides, for products that domestic enterprises can produce, if the market has great demand, there must be trade promotion programs to increase domestic demand, including tourism and services.

I highly appreciate the policy of reducing VAT. This is a very appropriate fiscal policy in the current context.

In addition, if other economic sectors are removed, it will also help support the market. For example, removing difficulties for the real estate market, thereby dragging businesses producing construction materials, iron and steel. These issues need the appropriate and flexible management of the Government and ministries, branches and localities.

Thank Sir!