Support businesses based on their practical needs

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Mr. To Hoai Nam

2019 is the second year since the Law on Supporting Small and Medium Enterprises took effect. What is your assessment of the impact of this law on supporting businesses in Vietnam last year?

The institutional improvement of legal documents was relatively complete in 2019. Guidelines, regulations and terms are very adequate and specific, helping agencies, ministries and branches "collate" based on the structure and tasks to implement, thereby providing the most support to businesses. This has enabled small and medium-sized enterprises, even micro-enterprises, to receive support, bringing support activities in line with the enactment of a separate law on supporting businesses.

However, many specific programmes and projects are still lacking to implement this law, and many policies have not brought positive changes. The reason is that local programmes and projects lack resources, especially funding, to operate. Moreover, management agencies have not been able to overcome the dispersion situation, for examplethe industry and commerce sector only supports the industry and commerce sector, the agricultural sector only supports the agricultural sector; this lack of connection and coordination leads to limited and dispersed resources, making it difficult to create efficiency and good effects for businesses.

In addition to support activities under the Law on Supporting Small and Medium Enterprises as well as related legal documents, where do enterprises receive other incentives?

The action and process of implementing supporting activities that can reach businesses is practical and intrinsic. In addition to the Law on Supporting Small and Medium Enterprises, enterprises are benefiting greatly from the resolutions, decisions and directives of the Party and Government. Resolution No. 10-NQ/TW on developing the private sector as an important driving force of the socialist-oriented market economy is an example. It has created large legal frameworks and strong resonance factors for the confidence and resilience of private enterprises.

According to the latest survey of the Vietnam Association of Small and Medium Enterprises on businesses’ satisfaction in the support and motivation for their development, the business community highly appreciated the efforts of agencies, ministries, branches and localities, especially the use of technology, changing working forms and simplifying procedures, helping businesses save time and costs significantly. For example, in the Customs sector, the association's survey showed up to 37.5 percent of businesses said the Customs sector had excellent or good changes to support businesses, 55.2 percent were satisfied with the changes and only 7.3 percent of businesses said there were no changes.

Entering 2020, how do businesses expect to get support on these issues?

Among resources Vietnamese enterprises are always lacking and weak in, finance is the most important issue. Therefore, support should be in the direction of diversifying financial sources, and establishing venture capital funds. Moreover, in the current context, businesses not only need to be advantageous but also to have social responsibility activities. Therefore, management agencies should facilitate businesses have easier access to premises to conduct their production, helping them comply with environmental standards. In addition, businesses want that their property rights respected and their initiatives, innovations, and intellectual property rights considered collateral in credit contracts.

There are still many things to support businesses, according to you, which direction should this work be done to be more effective?

Based on existing policies, in my opinion, we do not have to add any more, the most important thing is to take actions, because enterprises’ business activities always need instructions. For central agencies, it is necessary to set up an organisation or a council to act as a focal point to advise the Government on policies to support small and medium-sized enterprises. This unit will connect support activities with each other. It needs a head who is a member of the Government to give smooth guidance among ministries and branches.

In particular, unless there are resources, support activities cannot be conducted, or supported on paper only. Therefore, units must calculate resources and offer practical support programmes in accordance with the businesses’demand. Using thin resources to support what businesses do not need is wasted. For example, small and medium-sized enterprises have a trend of digital transformation, but many of them do not know how to do so because of knowledge constraints. At this time, support activities are to equip knowledge and train them. Doing this requires professional associations, which always follow and understand members’ needs.

In addition, support activities are both focused and diverse with suitable mechanisms to each industry and each area. The working style, capacity and psychology of civil servants and support workers must also be changed and transformed. Those who deeply understand their job and have professional knowledge and experience in approaching enterprises should be selected for management.