Workers produce clothes-hangers at a domestic company. The Ministry of Planning and Investment plans to formulate a new law to assist SMEs. — Photo thanhnien.com.vn

The ministry and sectors and localities have implemented numerous policies to support these enterprises but witnessed negligible results, thus prompting the need for a new law, said Trinh Thi Huong of the MPI's Enterprise Development Department.

Existing support programmes include a bank-to-enterprise linking package worth VND40 trillion (US$1.90 billion), more than 20 credit insurance funds for SMEs and priority lending for sectors like agriculture, seafood and support enterprises.

The Government has reserved about $20 million in funds per year to assist the SMEs in technology, intellectual property and human resource development, and has allocated land reserves for them.

However, efficiency in the implementation of 80 per cent of the programmes has yet to be assessed and apparently remains limited, said Huong.

Participants on Tuesday attributed this shortcoming to authorities' lack of comprehensive policies. They also cited the failure of enterprises to prove their management capability and transparency as a hindrance to their access to financial support.

"Some sectors such as taxation and social insurance rarely share information, so banks lack the basis for deciding whether to lend money to enterprises," Techcombank Deputy General Director Ta Quang Thang told the Thanh Nien (Young People) online newspaper.

Enterprise Development Department Director Ho Sy Hung said that if the law was formulated and approved, it would provide authorities with the legal basis to define and specify budgets for SME support. He added that the shortage of budgets was the biggest obstacle to efforts to help the SMEs.

Pham Ngoc Long, director of the Institute for SME Management, said the law should provide more details rather than regulate general issues related to business environment and administrative procedures.

A representative of the Ministry of Science and Technology suggested that the law stipulate incentives for SMEs engaged in high-technology processing and manufacturing.

Pham Thi Thu Hang, general secretary of the Viet Nam Chamber of Commerce and Industry, urged authorities to build mechanisms that would foster linkages among SMEs and encourage larger enterprises and business associations to help them.

Cao Sy Kiem, chairman of the Viet Nam Association of SMEs, noted that the new legislation should be carefully studied to avoid overlapping with existing economic laws and to promote its practical effects. — VNS