Businesses must join hands to increase competitiveness

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VietNam News English - 33 month(s) ago 6 readings

Experts stressed the significant role of "business linkage" in helping enterprises cope with the global economic crisis at a conference announcing the "Viet Nam Business Annual Report 2011" in the capital yesterday.

Workers make nail clippers at HCM City-based Nghia Nippers Corporation. Business linkage has a significant role in helping enterprises face the global economic crisis. — VNA/VNS Photo The Anh
HA NOI — Experts stressed the significant role of "business linkage" in helping enterprises cope with the global economic crisis at a conference announcing the "Viet Nam Business Annual Report 2011" in the capital yesterday.

The annual report has been drawn up by the Viet Nam Chamber of Commerce and Industry (VCCI) since 2006.

Vu Tien Loc, chairman of the VCCI, said: "Business linkage is key to sharpening competitive edge. The report points out the advantages and disadvantages of such linkage in assisting firms map out appropriate development strategies."

Five sectors were highlighted for survey in terms of business linkage and included food processing, leather and footwear, the auto industry, logistics and tourism.

Pham Thi Thu Hang, VCCI general secretary, said the five sectors were typical examples proving the importance of business linkage in bolstering industrial development.

She emphasised the important role of industrial associations in supporting, protecting as well as improving competitiveness amongst companies. However, she added that the linkage between producers, suppliers and distributors were still loose.

To better support enterprises, the VCCI set up the Sub-contracting and Partnership Exchange of Viet Nam (SXP) to build up data on support industries and link enterprises with one another via systematic supplying chains.

Vice President and General Secretary of the Viet Nam Retailers' Association, Dinh Thi My Loan mentioned three kinds of business linkage in the retail sector.

"Retailers share goods supply resources, hire retail space and have committed to rein in retail prices. This has helped enterprises cut costs."

Director of the World Bank Viet Nam Victoria Kwakwa said that the private sector played a key role in national economic development and the VCCI should continue promoting its role to become an effective bridge between the Government, ministries and businesses to help improve competitiveness.

Last year, local enterprises coped with a series of difficulties, including high inflation, high interest rates, higher costs in human resources, raw materials, machines and equipment and other impacts from the global economic crisis.

According to the report, in 2011, the number of newly registered companies reached only 77,500 with a total registered capital of VND513 trillion (US$23.3 billion), down 13 per cent in business number and 5.7 per cent in capital against the previous year. This brings the total of existing companies to 544,000 to date.

Some 7,600 companies dissolved last year.

Besides enterprise capacity and business linkage during 2011, the report also gave predictions about the Vietnamese economy for 2012.

Accordingly, the Government should ensure an appropriate adjustment in oil and power prices to help cut company input costs, extend or reduce corporate income taxes and warrantee a reasonable ratio of commercial loans for producers and small- and-medium sized enterprises.

Nguyen Van Phuc, deputy chairman of the National Assembly Economic Committee, said: "We have to take bold measures to restructure the economy as well as investment and State-owned enterprises to ensure long-term sustainable development." — VNS

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