September 22, 2020 15:04

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Supporting business: being provided “breathing machine” but lacking “oxygen”

10:09 | 16/04/2020

VCN - The Government’s support packages were issued in a timely manner and suited the difficulties of businesses affected by the Covid-19 epidemic, but according to businesses, these supports have not been as expected.

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Textile 10/10’s leaders said the cash flow of the business was all in the goods. Photo: H. Diu

"Saving" businesses must be like "fighting fire"

In the meeting between the Vietnam Chamber of Commerce and Industry and enterprises of Hanoi Association of Small and Medium Enterprises (Hanoisme), firms frankly stated the situation as well as made comment on the Government's business support programme, ministries and sectors in the situation of the Covid-19 epidemic.

Than Duc Viet, General Director of 10/10 textile Joint Stock Company said businesses have to try their best to maintain production and be ready to fight the pandemic. However, business activities face many difficulties due to the partners also influenced by Covid-19.

“Typically, the apparel industry's business will turn around after sixmonths. But customers either stop or cancel signed orders, even, many customers have asked to delay the order payment time up to 120 days, instead of 30days as before. Therefore, the status of 10/10 textile Joint Stock Company is goods in stock, making the entire cash flow of the company completely out of goods, while fashion items are seasonal,” Viet said.

These difficulties left more than half of 10/10 textile Joint Stock Company’s workers unemployed. This situation hitsnot only businesses in the textile industry but also many other export businesses such as furniture, leather and footwear.

Therefore, all businesses agree this situation of "saving" businesses must be like "fightingfire", this is the "golden time" to prevent epidemics and save businesses, so it must take full advantage ofsupport measures andsupport packages issued by the Government.

Need a separate "playground"

According to To Nhu Toan, Chairman of the Board of Directors of Van Phu Invest Joint Stock Company, the Government has made policies to support businesses in a very timely fashion, but the criteria for implementation have not been seen. The criteria from tax rescheduling and debt extension are not available, if it takes a long time, enterprises will fall into the "bad debt" group, they will lose credibility, making it difficult to attract foreign investment. Moreover, by the time there is a mechanism, they have to wait for the bank to reviewdocuments, perhaps many businesses have also "died" already.

In addition, Toan also said that the support policies should clearly distinguish between large and small and medium-sized enterprises andneed to have "own playground" with own criteria, otherwise, the support can "drift away" about big businesses thanks to "relationships", benefits.

supporting business being provided breathing machine but lacking oxygen
Enterprises at the meeting with the VCCI’s leaders

In particular, Vo Viet Dung, Chairman of the Board of Directors of South Hanoi Food Processing Group (SHF) expressed his concern about inconsistency in the policy between leading agencies and implementing levels.

Dung frankly stated the fact that as soon as he learned about the policy of reducing interest rates, restructuring debts of the State Bank and commercial banks, on April 9, he contacted a branch of the bankfor advice and support. However, the representative of this bank branch said there is currently no mechanism for debt restructuring and debt rescheduling.If the company does extend the debt, then credit ratings can be classified as a bad debt later.

Facing this information, Vo Viet Dung said that such support is "meaningless", businesses will not dare trade their fortunes and long-term prestige for short-term benefits.

“Businesses are like patients, governments and banks are doctors, support packages are ’breathing machine‘, money and interest are oxygen. At the current situation is provided ’breathing machine‘, but not for ’oxygen’”said the leader of SHF.

Agree with the above reflections, Vu Tien Loc, Chairman of VCCI, said that enterprises are the "lifeblood" and "kitchen" of the economy, if they arenot supported in time, the consequences will be great. Therefore, State agencies need to have practical, consistent support measures, implemented as soon as possible; avoiding each one makes a different type.

In addition, he also said the Government should set up a Steering Committee or working group to control and review support activities for businesses, helping these activities be effective and right where needed support.

By Huong Diu/Quynhlan