Number of firms set up surges in March

Monday, Mar 31, 2014 09:39

There were 7,487 new companies who invested a total of more than US$1.66 billion.— Photo ndh

HCM CITY (Biz Hub) — The number of firms established in March and their total capital almost doubled from the previous month, according to figures from the Department of Planning and Investment.

There were 7,487 new companies who invested a total of more than VND35 trillion (US$1.66 billion).

In the first quarter as a whole the number of firms that were incorporated and the number that closed down were comparable, though the former increased by 16.9 per cent year-on-year, almost twice the latter figure.

But in Cuu Long (Mekong) Delta provinces, the number of firms that closed down was up 26.1 per cent while the number of start-ups rose by just 2.5 per cent.

Le Xuan Nghia, director of the Business Development Institute, the figures reflect the churning going on in the economy. Sectors like services, processing, and manufacturing are attracting plenty of investment while construction and financial and insurance services have declined, Tien phong newspaper quoted him as saying.

He predicted this process would continue.

Vu Tien Loc, chairman of the Viet Nam Chamber of Commerce and Industry, said many local firms have become mature and begun to focus on long-term effectiveness and are pulling out of unstable sectors.

Le Duy Binh, director of the Ha Noi-based Economica Company, alluding to the continuing rise in the number of firms being dissolved, said many small firms like his own have little access to government incentives.

Binh recommended the government increase Consumer Price Index (CPI) to improve purchasing power. The Government should also ensure social security by reducing value-added tax, and improving social insurance.

Phan Duc Hieu of the Central Institute for Economic Management (CIEM) said all related agencies should work closely together to assist businesses.

"To help enterprises overcome challenges, incentives should be more specific and consistent," he said. — VNS

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