VCCI President proposes business support policies by levels and roadmap

Prime Minister meets the business community on September 26, 2021

Speaking at the Prime Minister’s Teleconference with the business commnunity and localities on solutions to continue supporting businesses amid COVID-19, held on the morning of September 26, VCCI President Pham Tan Cong said, amid COVID-19 pandemic, the economy and business community in Vietnam are going through difficulties caused by the COVID-19 pandemic. The economic development goals of the country and businesses are facing unprecedented challenges. So, the business community needs the support and companionship of the Government to overcome this crisis.

Before this teleconference, VCCI received 357 pages of reports and recommendations from 132 business associations (including domestic and foreign associations, cooperatives…). VCCI has studied, synthesized, and developed a report on the operation situation and recommendations of the business community to be submitted to the Prime Minister at this conference. The 52-page report, with a summary of 192 specific recommendations, was sent to the conference participants.

According to the VCCI President, the COIVD-19 pandemic is raging, ravaging the whole world, our country is also in a tough battle with the pandemic, people's health and lives are threatened, the production and business activities have stalled. Despite difficulties, our business community still shows a great sense of social responsibility, has contributed enormous resources worth tens of trillions of dongs to fight the epidemic. But, we must not forget that tens of thousands of businesses have to close, leave the market, the production chain is broken…

Only in the first 8 months of this year, over 85,000 enterprises, or over 10% of enterprises nationwide, withdrew from the market, triggering the loss of livelihoods of workers and the drop in GDP growth…

With the effects of the epidemic and prolonged social distancing, in the past 4 months, aggregate demand of the economy has declined; production and trade have stagnated; supply chains have been disrupted; workers have lost jobs; production and business costs skyrocketed; many economic sectors have operated below 60% of their full capacity. All economic sectors have been negatively affected. In which, the most serious are tourism, seafood processing, and transportation, said VCCI President. 

VCCI President Pham Tan Cong 

VCCI President stressed that the 4th outbreak in Vietnam is complicated, so we cannot return to Zero Covid state. If the social distance is forever, businesses will collapse. We need a new mindset, a new strategy, a new way of fighting the epidemic. The business community expressed their high agreement with the Prime Minister's point of view: "We must live with the epidemic for a long time, we cannot control it completely, we must respond and have a suitable approach ". With this approach, VCCI proposes two new policies:

First, it is necessary to recognize businesses as a subject in the Covid-19 response, thereby empowering and improving on-site medical capacity for businesses. Therefore, we need to let businesses proactively self-test and self-treat mild F0 cases depending on the capabilities and conditions of businesses, provided that the State needs to support and promulgate appropriate regulations.

Second, a solid economic front will be considered a foundation for victory on the medical front, so it is necessary to help businesses maintain safe production and business activities amid COVID-19. During the war, even though the bombs were fierce, we did not stop producing, but now, no matter how Covid, we must struggle to maintain safe production. To do this, a unified policy throughout the political system and the whole society is needed.

In response to the Prime Minister's new view on long-term coexistence with Covid-19, VCCI President proposed to consider renaming the "Steering Committee for COVID-19 Prevention and Control" to the "Steering Committee for COVID-19 Prevention and Economic Recovery", so that the task of fighting the epidemic, maintaining production and economic recovery is identified as an urgent one to create favorable conditions for businesses.

To carry out epidemic prevention and control along with economic recovery and development in the "new normal", the business community highly agreed with the 6 principles as stated by the Prime Minister at the meeting of the Steering Committee for COVID-19 Prevention and Control held on September 23, 2021, and would like to especially emphasize principles 5 and 6. First, vaccines, medicines, and people's awareness are seen as prerequisites. In short, vaccines are the key, the economic reopening must be synchronized with vaccine coverage. Second, production must be safe amid COVID-19. The world experience shows that if the economic reopening were not done under these principles, the consequences would be unpredictable.

For urgent solutions to be implemented immediately, the business community would like to propose the Government soon amend and supplement regulations on epidemic prevention and control in the new normal, such as promulgating a new legal document to replace Directives 15, 16, 19... with content suitable to new anti-epidemic strategy and the viewpoint of "long-term living with the epidemic". Moreover, the Directive is not a form of legal document, it should only be used in urgent cases, not for long-term use.

The Ministry of Health, the Ministry of Information and Communications, and the Ministry of Public Security are recommended to urgently study and perfect the "Covid-19 Green Card" system, and connect data between different relevant ministries and sectors; adjust the regulations on entry, work permit accordingly... to create stable conditions for the labor force, foreign experts and workers working in Vietnam.

For ensuring safe production and business, VCCI proposes the Government and National Assembly promptly study and promulgate new policies and regulations, including laws, to avoid the risk of outdated policies that become bottlenecks for business in the new normal.

The Ministry of Health is recommended to coordinate with relevant ministries and sectors to develop a set of common criteria for safe production amid the epidemic for enterprises and localities to apply them to the actual situation. VCCI recommended the Government to direct localities to immediately abolish their own regulations on restricting, inspecting, and controlling freight transport between regions, and only to inspect goods delivery and receipt points. Drivers only need a negative COVID-19 test, and comply with 5K and other safety measures…

The Ministry of Labor, Invalids and Social Affairs is recommended to consider increasing the limit      of overtime in line with the "3 on-the-spot" models so that businesses could deliver orders on time after a long period of production stagnation.

The General Confederation and the trade s at all levels are recommended to implement a program to encourage the employees who are still holding on to production, including those who came back to their hometowns to return to their businesses.

For policies to support business recovery, VCCI proposes the Government to direct relevant ministries and sectors to urgently issue guidelines on exemption and reduction of taxes, fees, electricity, and water bills… as stated in Resolution 105/NQ – CP, and continue to promote digital transformation with at least 30% of administrative procedures which will be carried out online.

The State Bank of Vietnam is recommended to continue stronger support policies such as extending credit limit     s; exempting and reducing interest rates; raising loan size to over 70% of collateral value; Increasing opportunities to access credit for small and medium enterprises (SMEs), micro-enterprises, business households... in the form of Credit Guarantee Funds, SME Support Fund...

Support packages should be big and timely enough to boost economic recovery. In 2020, Thailand launched bailouts equivalent to 12.4% of GDP, Indonesia of 5.4% GDP, Philippines of 3.6% GDP. With Vietnam’s GDP worth nearly VND 6.3 million billion in 2020, the Government could expand its support packages to 4% of GDP, equivalent to VND 250,000 billion.

Regarding mid-and long-term solutions, the VCCI President proposed that besides support policies on taxes, fees, and credits, it is also necessary to develop policies for durable development right now, such as improving the business environment, promoting public investment, developing the digital economy, accelerating the reform of import and export procedures and making good use of opportunities from FTAs...