Adding a "support system" to help small and medium-sized enterprises accelerate their growth.

Statistics show that there are currently over 1 million active businesses nationwide, of which about 98% are small and medium-sized enterprises (SMEs), but most find it difficult to participate deeply in global value chains. The challenge is to remove bottlenecks so that Vietnam can reach 3 million businesses by 2030, a powerful resource for the economy.

Small and weak

From a small production facility of just over ^1,000m² located in a residential area, Minh Man Printing and Trading Co., Ltd. has gradually expanded its scale, investing in a modern factory of over ^10,000m² in Tan Phu Trung Industrial Park (Ho Chi Minh City), becoming one of the leading supporting industrial enterprises in the printing sector. The company's development journey is closely linked to numerous support programs in management, technology, and loan capital from Ho Chi Minh City.

Through the city's investment stimulus program, the company received interest rate subsidies to build a factory and invest in 14 machines and equipment for production, totaling nearly 100 billion VND. Simultaneously, the company continuously participated in supporting industry exhibitions, supplier search conferences for foreign direct investment (FDI) enterprises, and numerous trade promotion programs implemented by the Ho Chi Minh City Department of Industry and Trade in collaboration with international organizations. Thanks to technological upgrades, factory expansion, and standardized management, Minh Man Printing and Trading Co., Ltd. has gradually joined the supply chains of many large corporations such as Panasonic, Sharp, Sanyo, and Unilever.

The technical team operates the control system at Chanh Duong Paper Mill Co., Ltd., Ben Cat Ward, Ho Chi Minh City. Photo: HOANG HUNG

The story of Minh Man Printing and Trading Co., Ltd. shows that, with proper support in terms of capital, technology, and market connections, Vietnamese supporting industry enterprises can participate more deeply in the global supply chain. However, the number of enterprises that have achieved this is still very small. According to the Department of Private Enterprise and Collective Economy Development ( Ministry of Finance ), the number of enterprises accessing support funds and credit guarantees is currently less than 1% of the total number of operating enterprises; many enterprises report that the support procedures are still complicated, implementation is slow, and there is a lack of coordination between localities.

Meanwhile, a representative from the Can Tho Department of Finance stated that while the Law on Supporting Small and Medium-Sized Enterprises contains many good provisions, its practical implementation often overlaps with other laws concerning land, investment, science and technology , and the environment. Furthermore, many policies considered "excellent" are sometimes implemented differently at the local level, causing difficulties for specialists due to their involvement across various management areas.

Support is deep enough to allow for an "upgrade".

According to Ms. Le Nguyen Duy Oanh, Deputy Director of the Center for Technical Support and Sustainable Development (Ho Chi Minh City Department of Industry and Trade), large corporations such as Toyota, Samsung, Panasonic, etc., are constantly seeking suppliers in Vietnam. However, most domestic businesses can only meet the requirements for simple mechanical parts, failing to meet high demands for precision, quality standards, and delivery schedules. "Small and medium-sized enterprises (SMEs) have the opportunity to participate more deeply in the global supply chain if they receive comprehensive support in terms of capital, production facilities, technology, standards, and human resources," Ms. Le Nguyen Duy Oanh stated.

From a business perspective, Mr. Dinh Hong Ky, Vice Chairman of the Ho Chi Minh City Business Association, believes that the biggest bottleneck currently facing small and medium-sized enterprises (SMEs) is the lack of a sufficiently deep support ecosystem to enable them to "upgrade" their production capacity and participate in global supply chains. Businesses lack comprehensive support mechanisms, ranging from improving management, raising production standards, supporting digitalization, accessing capital, to connecting with customers and monitoring post-support effectiveness. Therefore, instead of supporting individual programs, it is necessary to shift to a model of support based on a "business upgrade journey," helping businesses acquire customers, orders, meet standards, and gain the capacity to participate in the value chain. In addition, capital remains the biggest bottleneck, as most SMEs find it difficult to access credit due to reliance on collateral, while their financial capacity is limited.

"There is a need for a strong reform of the financial mechanism towards lending based on cash flow, contracts, orders, or transaction data instead of solely relying on collateral. At the same time, relevant agencies need to quickly finalize the mechanisms for credit guarantee funds, re-guarantee funds, and seed capital models for innovation and green transformation," Mr. Dinh Hong Ky suggested.

Ms. Trinh Thi Huong, Deputy Director of the Department of Private Enterprise and Collective Economy Development (Ministry of Finance), said that the Ministry of Finance is amending the Law on Supporting Small and Medium-Sized Enterprises in a comprehensive manner. The draft not only changes the criteria for defining enterprises but also significantly innovates the support methods, with many new mechanisms aimed at promoting enterprises' participation in global value chains, innovation, digital transformation, and green transformation. For small-scale public investment projects, the draft also proposes prioritizing the participation of small and medium-sized enterprises.

AI VAN

Source: https://www.sggp.org.vn/them-be-do-de-doanh-nghiep-nho-va-vua-tang-toc-post854137.html