An automotive assembly factory of the Hyundai Thanh Cong Vietnam company (Photo: VNA) HCMCity (VNS/VNA) - The Government needs to do more to revive the businesssector, Dr Tran Hung Son, Deputy Director of the Institute for Development andResearch in Banking Technology under the Vietnam National University-HCMCity has said.
Speakingat a conference in HCM City on May 20 he said the Government’s 300trillion VND (12.9 billion USD) credit package at low interest rates foraffected businesses, extending the payment deadline for 180 trillion VND (7.7billion USD) worth of taxes and fees and reducing social insurance and healthinsurance premiums for employers are not enough.
Hequoted a report by the Institute for Development and Research in BankingTechnology, a think tank set up by his university, as saying these measureshave a limited impact on businesses since they only reduce expenses and do notincrease cash flows or revenues.
Thesecannot save businesses on the verge of shutting down or going bankrupt, he said.
“Tosave those businesses, real money must be injected.”
Thecredit package to support those affected by the pandemic could indeed augmentworking capital for businesses, but many are finding it difficult to access theloans, especially small and medium-sized enterprises, the worst affected, hesaid.
Toimprove businesses’ financial situation in the short term the Government shouldallow them to account for salary payments this year itself instead of the firstquarter of next year so that they could get tax refunds earlier, hesaid.
Itshould speed up public spending of 700 trillion VND (29.8 billion USD) it hasearmarked for this year, he said.
Inthe medium term, the Ministry of Finance could consider allowing businesses totransfer this year’s losses to 2018 and 2019 to similarly enable businesses toget tax refunds.
DeputyMinister of Planning and Investment Tran Quoc Phuong said the economicsituation is really bad, especially the GDP growth of only 3.82 percent in thefirst quarter, the lowest rate in a decade, and certain other macroeconomicindicators.
Businessesare facing great difficulties due to interrupted supply chains, cancelledorders and lack of new ones, he said.
Butthere is no end in sight yet to the challenges because the pandemic iscontinuing in a complicated manner without any accurate prognostication of whenit would end, he said.
Thelonger it continues, the direr the economic situation would become, he warned.
Itis predicted that 250,000 - 400,000 workers could lose their jobs, depending onthe duration and seriousness of the pandemic, he said.
Theoutbreak has changed the global economy and Vietnam needs to make carefulpreparations from here on, including restructure of its economy and developmentof key projects to foster sustainable economic development, headded./.
VNA
