Many people think "the most difficult time is over" after Covid, but the consequences of it and the subsequent global geopolitical instability make business owners more exhausted, according to the Director of the Office of Division IV.
The Private Economic Development Research Board (Division IV) has just reported to the Prime Minister on the business situation. This survey was conducted by Division IV and VnExpress implemented in December 12, with the participation of more than 2023 business representatives. Director of Department IV Office Pham Thi Ngoc Thuy, who is in charge of the report, assessed that this survey's results showed that business confidence had returned but "many difficulties still remain".
Ms. Pham Thi Ngoc Thuy, Director of Division IV Office. Image: Characters provided
– If you were to name the difficulties businesses face in 2023, what would you say?
– Businesses are exhausted, it's true, especially after two years of Covid-19 and two years of facing global instability, although difficulties for businesses are not actually new. These include difficulties in orders, access to capital, administrative procedures, and the risk of criminalization...
Businesses are very concerned about risks at home and abroad. Outside are challenges and trends that no one can predict. War is only part of the deeper trend of division instead of globalization as before. There were even times when, when discussing with each other the volumes of defense budget expenditures in major countries, businesses saw that the war's progress was still very complicated, directly affecting the global trade chain. bridge. For example, tensions in the Red Sea are causing shipping costs to escalate. The recovery of major countries that is not as expected also affects Vietnam because we are an open economy.
Domestically, some businesses say they feel like they are not in the priority support of many agencies and local enforcement levels, even though they know that businesses are always mentioned at all levels of executive guidance. They said, many parties provide support in a formal and mechanical way, with the mindset of protecting themselves in the context of many cases being brought to trial. This is shown in the report by the high number of negative reviews regarding local behavior.
– What are the worries of each specific business group?
– With agriculture, if only looking at the data, 2023 has many bright spots with continuous growth in markets and orders. Never before have agricultural exports been so brilliant, with so many records. But behind that, businesses do not have good capital accumulation. In the stages where they need to collect money to buy and sell goods, their financial pressure is huge, while the general context in 2023 is that the financial situation is eroding and accessing credit lines is not simple. When domestic enterprises cannot consume in time, it will create opportunities for FDI groups that are strong in purchasing capital flows.
Businesses also face pressure when the market demands a change in quality. For the production group, the problem of improving quality is for each enterprise, but for agriculture, it is the story of the entire ecosystem with many subjects, thinking not on the same level. Therefore, this group is still facing many uncertainties.
In the group of manufacturing enterprises, their space to use cheap capital is decreasing dramatically while quality requirements are becoming increasingly strict. Not only is it a digital transformation story, they are currently facing huge green transformation pressure as they are a high-emitting industry. Recently, international buyers have continuously issued messages and requirements on green production and procurement. If they do not convert, they will lose market share. Changes for businesses at this time are not very optimistic when money is tight and the workforce is not prepared in time.
– As someone who accompanies the activities of associations and businesses, what impresses you about how they will overcome 2023?
– Every 6 months, Department IV conducts periodic surveys to report information on practical activities of enterprises to the Prime Minister, along with sending policy advice to the Prime Minister. This time the results show relatively positive points compared to April. The difficult times for businesses are continuing but confidence has returned. For example, the rate of "positive" and "very positive" assessments on the macro economy is 4 times higher than before. Other indices and indicators such as the prospect of access to capital, the market, and the effectiveness of local government support all have higher scores.
Basically, they have returned to the circuit to focus on production and business. In mid-2023, the mood of business owners will decline a lot, distracted by economic disruptions and global crises. The shock at that time was relatively sudden for them because most thought that after Covid, the most difficult times were over.
The business then also specifically focused on restructuring to optimize operations. They also focus on finding new markets - something that has never been discussed so much. Previously, many businesses were very hesitant because finding a new partner took a lot of time, while the old market was still stable.
A series of substantive promotions were opened with partners from new markets such as India, Canada, the Arab bloc, and the Middle East. Thanks to this, many businesses have compensated for the shortage due to reduced orders in the traditional market.
Telling us, Mr. Nguyen Quoc Khanh, Chairman of AA Corporation, called Cambodia a "salvage market" because thanks to that, the business's revenue last year was no less than in 2022. This country has no changes in the real estate industry. products, so their demand and purchasing power for furniture and wooden products are very stable.
Another point is that businesses are also more active in green transformation. If at the beginning of 2023 they were still very confused, not knowing how to proceed, by the end of the year, some had improved their awareness, understanding, and even started working. Thanks to that, some also benefited to a certain extent.
For example, in the context of difficult growth of the textile industry, Ho Guom Garment Joint Stock Company, after achieving international sustainable green certification, has taken advantage to maintain and expand exports in a number of difficult markets. quality, high standards.
Mr. Dinh Hong Ky's Secoin also focuses on developing sustainable construction material product lines, so it also has a very solid foothold, expanding its customer network following the green shopping trend.
In general, in 2023, what I think about and admire most of business owners is the spirit of perseverance and overcoming difficulties. Even in the most difficult times, although they wavered and even lost confidence, they still told each other "we must keep the business, keep the workers, no matter how difficult it is, there is a way if we stay calm and cohesive". That spirit has been gradually strengthened and helped many businesses make breakthroughs at the end of the year, shown through macro indicators or each industry. This is also a great internal force to help businesses control the situation in 2024 because no matter how difficult it is, it will probably not be more than the past 3 years.
– If so, will 2023 be the bottom of the business?
– Looking at macro numbers, we hope 2023 is the bottom of difficulties. However, international and domestic experts also believe that 2024 still has many complicated developments that are difficult to predict, so we cannot be subjective. I think we still have to keep the spirit of saving ourselves, find a way to live, no matter what, we have to laugh to keep fighting.
– How do you evaluate the Government's solutions in the past year?
– In the process of working with businesses and through the recent survey, we see that the community highly appreciates the Government's direction and management by being drastic and closely following developments in the economy. GDP growth or the speed of public investment disbursement all show that. We ourselves have also attended many meetings of the Prime Minister and Government leaders to urge and remove difficulties for businesses and the economy, so we have the same feeling.
Business evaluation in this survey is better than the first time (in March 1) in all indicators, continuing to confirm this. In particular, many records related to policies where support can be applied immediately to life, without having to go through approval processes and procedures such as extension of VAT payment, corporate income tax, reduction of 3 % VAT for some goods and services.
But it should be noted that the survey results still show that businesses do not appreciate policies that force them to carry out many approval and proof procedures and may even have to go through the ask-give mechanism ( such as VAT refund, 2% interest rate preferential support.
They also evaluated quite negatively the implementation of business support policies with local authorities.
– To continue supporting businesses this year, what do you think the Government needs to pay attention to?
– Overall, I think 2024 is still the year the Government needs to maintain drastic and timely support for businesses because they are really being eroded. If not nurtured, their strength will be exhausted. But this support must spread from the Government to ministries, branches and grassroots levels. We must have an acting government, a constructive government, not just a government. In addition, we believe that the more policies reduce processes and procedures, the more effective they are.
At the same time, as Vietnam's role is constantly being strengthened in the international arena, this is the "golden time" of reform, thoroughly solving the internal problems of the economy as well as the development model. to create new development dynamics. It is time to transform the economic development model, from one based on resource intensiveness to one based on efficiency and creativity with green and digital trends. Vietnam has the position and strength to take advantage of opportunities and develop the economy based on creativity and technology.
Regarding solution orientation, I think we still have to "drill the people's strength", including creating cash flow; reduce and extend taxes and fees, develop ethnic businesses, and take advantage of opportunities from the country's new position.
Phuong Anh
