Vietnam - Businesses still looking forward to bailout

VietNamNet Bridge – The information about the solutions, support packages and projects to rescue businesses from sinking has been flooding local newspapers in recent days. However, the bailout still has not reached out to businesses.

Businesses have been told to wait, but they are not sure how long more they have to wait. Doubts have been raised that if these were just vain promises committed just to reassure the businesses in quandary.

Waiting for support, catfish caught in a shoal

Two months ago, seafood processing companies and farmers felt excited when hearing that the Prime Minister approved the 9 trillion dong bailout to help rescue the fisheries industry. The good news then revived the aquaculture and seafood processing industry which was in the desperation.

9 trillion dong is really a huge sum of capital, which explained why the enterprises in other business sectors then felt envious with the catfish industry.

However, catfish farmers have fallen again into desperation because the sum of money has not been disbursed.

According to Truong Dinh Hoe, Secretary General of the Vietnam Association of Seafood Exporters and Producers (VASEP), no dong of the package has been disbursed so far. Meanwhile, catfish enterprises and farmers are getting exhausted because of the feed price increases. The plan on the disbursement of the bailout, which the Prime Minister assigned to the Ministry of Agriculture and Rural Development (MARD) remains on… paper.

The catfish export markets, including the Europe, have been unstable and has led to the sharp falls of exports and profits. Vietnamese enterprises hope to see the exports increasing in the last months of the year. However, the serious capital shortage has hindered their plan. They have no other choice than maintaining production at a moderate level to drag their miserable existence.

Mai Dang Hoa, General Director of the Saigon-Mekong Seafood Company, also said most enterprises are now thirsty for capital. Since they cannot borrow money from banks, they cannot collect materials for processing.

“We are looking forward to the bailout promised by the government, but we are running out of patience,” he said.

Duong Anh Tuan, Director of the Binh Minh Husbandry Company, said he heard from his sources that by October, the Ministry of Finance and the State Bank of Vietnam would finish the compilation of the documents stipulating the procedures for the disbursement of the 3 trillion dong bailout designed for husbandry and fisheries.

However, Tuan said, it always takes a long time from the day a legal document comes out to the day the policy can be brought into life. Therefore, he has advised businesses to “rescue themselves, rather than keep waiting for the bailout.”

How much longer will businesses have to wait?

The plan to rescue businesses initiated by the Ministry of Industry and Trade promises to give support to businesses in the capital access, but also to approach development opportunities or trade promotion.

However, businesses still cannot see the benefits of the initiative.

Nguyen Chien Thang, Chair of the HCM City Fine Arts and Wood Processing Association, believes that wooden furniture manufacturers have not got appropriate attention.

While the Ministry of Industry and Trade promises to help businesses in trade promotion activities, wooden furniture manufacturers’ plan to attend the Las Vegas Trade Fair and the High Point trade fair in the US has been refused, while the budgets for attending some other activities have been cut down.

The ministry has received 236 national trade promotion projects which need the total expenses of 319 billion dong. Meanwhile, the total budget for the trade promotion is just 45.9 billion dong for the whole year 2012.

Phuoc Ha

Business & Investment Opportunities 
YourVietnamExpert is a division of Saigon Business Corporation Pte Ltd, Incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Healthcare and Life Science with expertise in ASEAN. Since we are currently changing the platform of www.yourvietnamexpert.com, you may contact us at: sbc.pte@gmail.com, provisionally. Many thanks.