On June 12, the National Assembly passed the Law on Support for Small- and Medium-sized Enterprises (SMEs). The much-awaited law, which will take effect from January 1, 2018, can outperform earlier support initiatives, Deputy Planning and Investment Minister Dang Huy Dong tells Dau Tu (Vietnam Investment Review).

The Law on Support for Small- and Medium-sized Enterprises (SMEs) was approved by the National Assembly recently. What are your thoughts on this?

The National Assembly passed this law with 83.5 per cent approval. As the ministry compiled this law, we are excited by this approval. This is good news for the business community, because after 15 years since the term Small- and Medium-sized Enterprises (SMEs) entered our business lexicon, the nation has a law stipulating support policies for SMEs.

What will the law deliver for the economy when it takes effect next year?

One of the most important things is that it will create an ecosystem for SMEs to thrive. It will facilitate the co-operation of enterprises with different industries and facilitate their joining value chains. This will contribute to improving the quality of growth and changing the nation’s economic growth model.

Although the law has passed, there are worries about its effective implementation, because previous support policies have failed to meet expectations.

That’s right. The Government has had several policies to supports SMEs, but we’ve never had a law. This meant that earlier supports were not stable and their legal level was not right. This law changes that.

An important thing is that we have compiled the law based on surveys and assessment of real demands expressed by businesses.

We built seven general support groups covering access to credit and land, as well as support with tax, technology and market expansion.

The law will focus on supporting SMEs that are converted from business households as well as start-ups. They will be helped to join value chains and industries’ production complexes.

The support will be based on market mechanisms and will not violate international treaties that Viet Nam is signatory to.

I think that by implementing well all the support activities for SMEs to join value chains, their production and consumption difficulties will be eased.

For instance, the law will encourage enterprises joining the production chain of the pig breeding industry, with some firms supplying pig varieties, others producing and/or supplying animal feed, some processing the meat and others distributing it.

In this, the associations, especially the Association of Small- and Medium-sized Enterprises, have a big role. They must facilitate these linkages and ensure that the State’s support reaches more and more enterprises.

Before the law was passed, you said it was a gift for the local business community. Can you explain?

This is a gift for the enterprises because the support policies have a solid legal backing now. If the law is implemented well, this will have higher value than monetary support.

The most important thing is that the State creates favourable conditions for enterprises to become more efficient. It should spread the support among the most eligible firms.

I believe that the law will ensure support policies are more correct and efficient.

What does the State plan to do to ensure effective implementation of the law?

An important thing that the Government will do is issue soon a decree guiding implementation of the law. A draft of this decree had already been prepared at the same time as the law was being compiled. The decree needs to be completed before it is issued officially. — VNS