The SMEs contributed 31 per cent to the budget collection and roughly 50 per cent to the economic growth of the Southeast Asian nation, creating 5 million jobs and accounting for 35 per cent of the business community's total investment. — VNA/VNS Photo Trong Dat

HA NOI (Biz Hub) — Small and medium enterprises (SMEs) would receive support to promote their innovations and enhance competitiveness at home and global markets, Deputy Minister of Planning and Investment Dang Huy Dong said.

At a meeting held by the ministry yesterday to discuss ideas on the draft plan for developing SMEs from 2016 to 2020, Dong said that promoting SMEs was indispensable, given their significant roles in the economy and social security they provide.

The SMEs contributed 31 per cent to the budget collection and roughly 50 per cent to the economic growth of the Southeast Asian nation, creating 5 million jobs and accounting for 35 per cent of the business community's total investment.

The 2016-20 plan was the country's third five-year plan for developing SMEs.

Experts at the conference said that support policies for SMEs in the past five years had still failed to meet the demands of enterprises due to the lack of attention and co-ordination among ministries, sectors and localities. In addition, SMEs themselves had limitations such as capital, human resource shortages and low awareness.

As improved product quality and reduced prices were becoming imperative to enhance competitiveness amid the rapid international integration of Viet Nam, Dong said that the plan would encourage innovations by SMEs to create original and high-added-value products with a focus on expanding exports.

It was estimated that a total of VND3 trillion (US$133.34 million) would be provided to SMEs within SME support programmes.

Policies must be consistent, timely and focussed, Dong stressed.

To Hoai Nam, deputy president of the Viet Nam Association of SMEs, said support should be as per the requirement of the firm, and added that the implementation must be consistent among ministries, agencies and localities to ensure that support policies benefit the firms.

Nam said SMEs expected to see a better business environment, human resource training, credit access, and land, in addition to trade promotion, brand building, and reasonable tax rates.

According to the Enterprise Development Agency, an additional 450,000 firms would be established during the 2016-20 period, bringing the total number of firms in operation by 2020 to 750,000. The SMEs were expected to provide jobs for 50 per cent of the country's labour force.

Minister of Planning and Investment Bui Quang Vinh, in a recent interview to Tin Tuc newspaper, said that Viet Nam had not paid adequate attention to implement a strong legal framework for creating favourable conditions for the development of SMEs.

Current support was still not enough, Vinh was quoted as saying. He said that more incentives were needed to develop SMEs into a core force of the economy.

The formulation of a law supporting SMEs was also underway, Vinh said, and added that the ministry proposed to the government that it launch incubators to promote start-ups. — VNS