Businesses propose solutions HCM City to recover economy post-Covid 19 pandemic

	Codes of many warehouses, yards and ports at Hai Phong changed
	Covid-19 pandemic - A strong catalyst for the re-positioning of logistics businesses
	Customs ready to share and accompany businesses

It is the first time that the city's economy grew below 1.2%. Photo: N.H

On October 3, the People's Committee of HCM City held a seminar "Restoring and developing the HCM City’s economy amid the complicated developments of the Covid-19 pandemic".

76% of businesses have not accessed support packages

Chu Tien Dung, Chairman of HCM City Business Association, outlinedthe general picture of local businesses including fourgroups.

The first group includes businesses operating effectively and profitably in finance, banking, food, food processing, equipment, machinery, pandemic prevention, furniture, information technology, and technical infrastructure. The number of enterprises in this group is about 10-15% of the total.

The second group includes businesses that are maintaining operations and awaiting the chance to recover, accounting for about 20%.

The third group includes businesses facingexhausted production capacity, weakened financial and human resources, narrowed market and broken supply chains. These businesses are at a loss and suspending operation andare mainly in the tourism, service, entertainment andreal estate industries, accounting for 40-50%.

The fourth group includes small and super small businesses that have had tostop production and operation, accounting for 20%.

In the field of textile and garment, arepresentative of HCM CityTextile and Garment - Embroidery Association said that in the fourth quarter, textile enterprises only have about 50% of the normal amount of orders. Meanwhile, processing prices drop by an average of 10%, and orders decrease up to 50%.From now to the end of the year, textile businesses must stop 20-50% of their business.

Regarding access to business support policy packages, Dung said that up to 76% of businesses have not yet accessed State support packages. Only 10% of businesses have had banks restructure their debts, reschedule debtsorreduce lending rates; 5% of businesses have accessed support packages to suspend retirement payment and no business have borrowed from the 0% interest rate package.

Also, Dung said most businesses have not yet accessed the support package to pay labourer’s wages because it is more difficult for businesses to implement procedures to borrow this package than a normal loan. Banks mainly offer loans to existing customers rather than new customers.

Businesses should be supported in terms of capital and reduced taxes

On proposals to restore and boost the HCM City’s economy, businesses said there should be policies to boost demand for tourism and consumption. In addition, the State Bank should loose lending conditions and offer loans to businesses by accessing their cash flow sources, business plans and unsecured loans.

In addition, Dung said the city needs to support the implementation of digital transformation in the business community.

“HCM City need to accompany businesses for a long term to restore productions, and propose banks to expand conditions, reduce lending rates, businesses can borrow more with lower interest rates, and more favorable conditions. Especially, state management agencies need to limit inspection in this pandemic period so that businesses can stabilise their production and business.” Dung emphasised.

Le Hoang Chau, Chairman of the HCM City Real Estate Association, also commented that besides facilitating businesses to access credit capital andkeep the debt group, it is necessary to remove problems related to regulations on land use fees to remove congestion for projects to ensure benefits for home buyers.

HCM CityTextile and Garment - Embroidery Association also proposed a tax reduction of 30% for all businesses, a reduction of VAT to 5% and allowing businesses to deduct a loss from 2020 to the 20% tax finalisation of 2019.

Speaking at the seminar, HCM City People's Committee Chairman Nguyen Thanh Phong said this is the first time the city's economy grew below 1.2%. As of September 30, more than27,000 businesses dissolved and suspended operations with registered capital of business fallingby more than VND 140,000 billion and the city’s revenue from production and business reduced more than VND 21,000 billion.

Facing this situation, HCM City has established a Council for the Sectoral Economic Development, including the leaders of departments, sectors, experts, associations and enterprises. It will collect more valuable opinions and proposals, and provide effective solutions to restore and develop HCM City’ economy.

According to Phong, the economic recovery of the city must start from restoring the operation of businesses because businesses are an important part of creating revenue for society and creating jobs. They also contribute to stimulating consumer demand and promoting disbursement of public investment.