Promoting private enterprise towards sustainable growth

VCN - For the first time, an initiative to promote socially responsible business practices known as the Standards: Environment, Society and Governance (ESG) for Small and Growing Businesses (SGBs) has been launched in Vietnam.
8 associations propose to abolish private enterprises that are subject to the Law on Implementing Democracy at Grassroots 8 associations propose to abolish private enterprises that are subject to the Law on Implementing Democracy at Grassroots
Economic restructuring: Need Economic restructuring: Need "new space" for private enterprises
Positive changes in government attitudes toward private enterprises Positive changes in government attitudes toward private enterprises

With the strong reforms and innovations in institutions and policies of the Party and State in the past 3 decades, especially in the past 10 years, the private economic sector in Vietnam has experienced significant growth in quantity and quality and has become one of the most important driving forces of the socialist-oriented market economy.

Notably, this economic sector continuously maintained a good growth rate, accounting for about 40% of GDP; attracting about 85% of the economy's labor force, making an important contribution to mobilizing social resources for investment, production and business development, economic growth, economic restructuring to increase income of state budget, create jobs, improve people's lives and ensure social security.

However, according to Deputy Minister of Planning and Investment Tran Quoc Phuong, domestic private enterprises are still weak and lacking in both quantity and quality; capacity of development and contribution with no comparison with the potential of this area.

In the future, Vietnamese enterprises will face many new challenges, increasingly fierce competition, pressure on labor productivity and digital transformation in the new context.

The production and business situation of enterprises is expected to continue to face many difficulties and challenges from objective factors such as the risk of a resurgence of the Covid-19 pandemic; climate change issues, droughts and floods are happening; the Russian-Ukrainian military conflict could be protracted; high inflation is likely to become a persistent problem in the medium term; the prices of gasoline, fuel, and raw materials are still high, which affects the resilience of businesses and the economy.

According to Deputy Minister Tran Quoc Phuong, at present, climate change has had an increasingly large impact on the life, economy and society of every country in the world and Vietnam is no exception.

Facing that impact, the requirements of partners and the market towards sustainable production and consumption are taking place strongly; Vietnam's commitments when joining the United Nations Framework Convention on Climate Change (COP26), priorities in the international cooperation frameworks ASEAN, APEC on sustainable business, green production, carbon tax, a carbon verification tool that is being applied more and more in countries around the world is posing challenges that need to be innovated for Vietnamese enterprises to catch up with new trends, otherwise, their competitiveness will be reduced and they will lose the opportunity to participate and move into the global value chain.

USAID will support Vietnamese SGBs so they can compete in the world and have more sustainable development. Photo: Saigon Transportation Mechanical Corporation - One Member Limited Liability Company (SAMCO)
USAID will support Vietnamese SGBs so they can compete in the world and have more sustainable development. Photo: Saigon Transportation Mechanical Corporation - One Member Limited Liability Company (SAMCO)

Assessing the challenges of the private sector in the future, Michael Schiffer, Asia Regional Director of the US Agency for International Development (USAID), said that despite being a source of job creation, Vietnam's SGBs are facing many challenges in sustainable development. Accordingly, USAID is expanding its partnership with the Ministry of Planning and Investment to help these enterprises overcome difficulties and seize opportunities to enhance their competitiveness. Specifically, USAID and the Ministry of Planning and Investment signed a cooperation agreement to further strengthen the capacity of the SME sector.

“We will support Vietnamese SGBs so they can compete in the world and have more sustainable development,” said Michael Schiffer.

USAID support to help raise awareness for 100,000 SGBs on Environment, Society and Governance (ESG); deploying ESG technical support package for 300 SGBs in order to meet the requirements of sustainable development of key export markets, develop an inclusive business model, green production; sponsoring piloting, implementing or scaling up 10 excellent ESG initiatives to spread sustainable business models with a total value of technical assistance of up to VND 6 billion.

At the same time, USAID will support through technology to develop renewable energy, green energy; and strengthen solutions for the business sector (including Vietnamese small and medium enterprises) to develop sustainably and shape market solutions.

This is the first ESG initiative in Vietnam for SGBs. These enterprises currently account for 97% of private sector enterprises and play an important role in the economic, social and environmental sustainability of Vietnam.

By Xuan Thao/Bui Diep

Related News

Exchange rate risks need attention in near future

Exchange rate risks need attention in near future

VCN - Exchange rate developments in 2025 are considered to be quite complicated due to US policies related to trade and investment.
Outlook for lending rates in 2025?

Outlook for lending rates in 2025?

VCN - The economy is forecast to continue to recover strongly from the end of 2024 to 2025, helping credit demand increase rapidly, but lending interest rates may also be under increasing pressure.
Industrial production maintains rapid and throughout bounceback

Industrial production maintains rapid and throughout bounceback

VCN - The industrial production index in 11 months continued to recover rapidly and increase steadily in 60/63 provinces and cities, which is a good signal for the economy.
Increase revenue from building a sustainable supply chain

Increase revenue from building a sustainable supply chain

VCN - As environmental, social, and governance (ESG) factors increasingly dominate business strategies, building a sustainable supply chain has become an inevitable requirement for businesses.

Latest News

Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

VCN - Data from the General Department of Vietnam Customs indicates a softening of both exports and imports in January 2025, relative to the same month in 2024.
Import and export turnover reaches about US$29 billion in the second half of January 2025

Import and export turnover reaches about US$29 billion in the second half of January 2025

VCN - Vietnam's total import and export turnover in the second half of January 2025 (January 16-31, 2025) reached US$28.9 billion, the latest preliminary statistics of the General Department of Vietnam Customs reported.
Market edges up slightly as liquidity remains low

Market edges up slightly as liquidity remains low

Market breadth remained positive, with 161 gainers outnumbering 144 decliners.
Business regulations must be trimmed for development of enterprises: Experts

Business regulations must be trimmed for development of enterprises: Experts

The General Statistics Office (GSO)'s socio-economic report for January 2025 reveals that while over 33,400 newly established or resumed businesses entered the market - marking a 15% increase compared to January 2024 - more than 58,300 businesses withdrew from the market, representing a growth of 8.1% on year.

More News

Vietnam's agricultural product exports shine in 2024

Vietnam's agricultural product exports shine in 2024

The agricultural sector wrapped up 2024 with 62.4 billion USD in export turnover, marking an 18.5% increase against 2023, while achieving a record trade surplus of 18.6 billion USD, surging 53.1%.
Aiming for 16% credit growth and removing credit room allocation

Aiming for 16% credit growth and removing credit room allocation

VCN - A representative of the State Bank of Vietnam (SBV) said that the SBV is gradually innovating its credit management methods, aiming to remove the mechanism of allocating credit room to each credit institution.
Malaysia initiates anti-dumping investigation on galvanised sheets from Việt Nam

Malaysia initiates anti-dumping investigation on galvanised sheets from Việt Nam

Malaysia has announced it will initiate an anti-dumping duty investigation on the imports of galvanised iron coils/sheets or galvanised steel coils/sheets originating from or imported from Việt Nam, China and South Korea.
Coffee prices hit record highs, heightening speculation risks

Coffee prices hit record highs, heightening speculation risks

Phan Minh Thông, Chairman of Phúc Sinh JSC, called the price surge "insane," warning of continued increases as businesses are compelled to trade at elevated prices instead of following pre-set contracts.
Exports witness a rise of US$1 billion in the first 15 days of 2025

Exports witness a rise of US$1 billion in the first 15 days of 2025

VCN - Compared to the same period in 2024, exports in the first half of January 2025 increased by more than 6%, equivalent to nearly USS$1 billion.
Central industrial hub sets ambitious growth target in 2025

Central industrial hub sets ambitious growth target in 2025

The central province has targeted ambitious growth of up to 10 per cent with some key strategic industrial investment projects in 2025, contributing VNĐ25 trillion (US$1 billion) to the State budget.
Demand for dragon fruit in Tiền Giang Province continues to increase

Demand for dragon fruit in Tiền Giang Province continues to increase

Dragon fruit prices in Tiền Giang Province remain high after the Lunar New Year due to increased demand from China and domestic consumption.
Data centres are attracting investors in Asia

Data centres are attracting investors in Asia

The global data centre market reached new heights in 2024, driven by the growing demand for generative AI, which has triggered a new wave of investment.
US or China: Who will lead in Vietnamese Tra fish imports?

US or China: Who will lead in Vietnamese Tra fish imports?

VCN - Given that tra fish is a key export commodity for Vietnam's seafood industry, the question arises whether the United States will surpass China as the leading importer of this product in 2025.
Read More

Your care

Latest Most read
Exchange rate risks need attention in near future

Exchange rate risks need attention in near future

VCN - Exchange rate developments in 2025 are considered to be quite complicated due to US policies related to trade and investment.
Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

Data from the General Department of Vietnam Customs indicates a softening of both exports and imports in January 2025, relative to the same month in 2024.
Import and export turnover reaches about US$29 billion in the second half of January 2025

Import and export turnover reaches about US$29 billion in the second half of January 2025

VCN - The figure decreased by 15.6% (equivalent to a decrease of US$5.33 billion) compared to the figure in the first half of January 2025.
Market edges up slightly as liquidity remains low

Market edges up slightly as liquidity remains low

Market breadth remained positive, with 161 gainers outnumbering 144 decliners.
Business regulations must be trimmed for development of enterprises: Experts

Business regulations must be trimmed for development of enterprises: Experts

The General Statistics Office (GSO)'s socio-economic report for January 2025 reveals that while over 33,400 newly established or resumed businesses entered the market - marking a 15% increase compared to January 2024 - more than 58,300 businesses withdrew from the market, representing a growth of 8.1% on year.
Mobile Version