HUBA: Exhausted companies urgently need financial support | Business


The delegation of deputies of the HCMC National Assembly had a meeting with business voters based in HCMC on October 2, in the presence of President Nguyen Xuan Phuc, Mr. Nguyen Thien Nhan, former Politburo member, former secretary of the HCMC Party Committee, Head of Delegation of Delegation of 14th National Assembly of HCMC, Member of 15th National Assembly, and Ms. Nguyen Thi Le, Deputy Secretary of HCMV Party Committee, Chairperson of HCMC People’s Council.

Production in difficulty during the pandemic

In the meeting with voters, Mr. Chu Tien Dung, chairman of HUBA, said that the companies had just gone through an extremely difficult time, but that they had done their best to partner with the city to fight against the pandemic, restore and develop the economy.

Many companies have overcome difficulties and have continued to maintain production under the “three in place” and “one route, two destinations” models, which are very expensive and unprofitable, but help to provide enough basic necessities, food, food and basic necessities. consumer goods to people and, at the same time, prevent disruption of national and global supply chains.

According to the president of HUBA, during the fourth outbreak of the Covid-19 pandemic, businesses in most industries and sectors of HCMC were paralyzed and had to shut down or shut down their activities. During this outbreak, only about 20 percent of production capacity can be maintained under the “three on site” and “one road, two destinations” model. However, sustaining production at high costs and heavy losses cannot be prolonged, and domestic and foreign supply chains are severely disrupted.

Mr. Chu Tien Dung admitted that the poor business performance made the number of dissolved, closed and temporarily suspended companies much higher than the number of newly established companies. Most of the businesses that have dissolved or ceased operations are small and very small businesses operating in the fields of transport, tourism or not in essential industries as prescribed.

At the meeting, the President of HUBA expected that the thoughts, aspirations and proposals of businesses would be recorded for consideration and resolution, to create new motivation to help businesses continue to grow and grow. contribute to the rapid and sustainable recovery of the economy.

Concerns about the labor shortage

According to statistics, 24,000 companies had exited the HCMC market by August of this year, accounting for 28.1% and increasing by 6.6% over the same period. However, the actual number is much higher because a large number of companies did not report.

With regard to the work situation, through survey data, nearly 30 percent of workers have lost their jobs. In which, the leather and footwear industry fell sharply by 62%; the textile industry fell 42.6 percent; accommodation services fell 37 percent; food service plunged 38 percent.

“The pressure on social work in the city is increasing as workers face hardships due to job loss and lack of income. The number of workers who have to leave the city to return to their hometown is increasing. Some workers do not want to go back to the city to work. It is a great difficulty when companies resume production, which may seriously affect the speed of the city’s economic recovery in the near future, ”said Mr. Chu Tien Dung.

Mr. Pham Van Viet, vice president of the HCMC Apparel, Textiles, Embroidery and Knitting Association, said that HCMC has a total workforce of over 4.7 million workers. Of which, over 3.2 million were in production and business sectors, and over 50 percent of them were workers from other provinces. In the last time, HCMC has worked with communities to bring more than 33,000 people back to their hometowns, not to mention those who had returned to their hometowns on their own earlier and had not yet been counted.

Many workers want to return to HCMC to work but have not been able to return due to pandemic prevention and control requirements and strict regulations on travel between localities.

Already weak companies will reduce their productivity, Pham Van Viet said, and there will be a risk of supply chain disruption due to a labor shortage. Companies need practical supportive policies and guidelines, such as arranging bus trips to bring workers from localities to HCMC, setting up “buffer zones” for screening exams, providing temporary accommodation to workers from other provinces within 14 days in vacant apartment buildings and relocation schools, where students have not returned, and to vaccinate and test workers before companies welcome them to the factory.

The scene of the meeting of the delegation of deputies of the HCMC National Assembly with the business voters of HCMC. (Photo: SGGP)

Mr. Pham Van Viet also suggested that HCMC should have land funds in the districts to build accommodation areas for concentrated workers. The city should have policies to subsidize housing and pensions and stabilize housing rents for workers. HCMC also needs to call for investment and offers preferential interest rates to induce and attract businesses to participate in the development of social housing and concentrated housing for workers.

The situation in which HCMC workers returned to their hometowns due to the impact of the Covid-19 pandemic has severely affected business production. Therefore, HUBA suggested that the government, HCMC and provinces need solutions to create favorable conditions for workers to return to work when the pandemic is under control.

Exhausted companies

According to Mr. Chu Tien Dung, the resources of the companies are exhausted, and they no longer have enough capital to quickly restore production. The HUBA also offered to the government to consider policies to support and eliminate the difficulties for businesses in the context of the Covid-19 pandemic.

Mr Pham Van Viet assessed that in the context of the impact of the Covid-19 pandemic, cash flow is like oxygen for businesses. However, most of them cannot access the support packages due to the strict regulations of the Credit Institutions Act. In which, companies must guarantee the absence of bad debts and have income, profits and collateral to be disbursed.

“The pandemic has lowered business revenues. Companies have no profit and no guarantees. It is expected that it will take more than two years to reestablish operations while the lending conditions of commercial banks remain unchanged, ”said Pham Van Viet. He suggested that there should be special regulation so that all companies can benefit from preferential interest rates, regardless of the industry.

He also added that although it was expected that in October of this year, the State Bank of Vietnam and the Ministry of Finance would submit to the National Assembly a support plan of around 3 trillion dong with an interest rate of 4% per annum on a total amount overdue. 100,000 billion VND loan, companies would still not have access to it if the government did not put in place a special mechanism for those facing difficulties due to the pandemic.

Mr. Nguyen Quoc Ky, Chairman of the Board of Directors of VIETRAVEL Company, also pointed out that companies need financial support like a patient needs oxygen. He suggested moving from “Zero Covid” awareness to “with Covid” to swift and decisive action. If the city remains timid and sticks to the idea of ​​Zero Covid, it will slow the progress of socio-economic recovery upon reopening and continue to negatively affect people’s lives and well-being.

According to Mr. Nguyen Quoc Ky, in the fight against the pandemic and the economic recovery, companies and entrepreneurs should be seen as partners rather than objects. If placed in the right position and trustworthy, entrepreneurs will be happy to support and contribute effectively.

HUBA proposed to SBV to increase refinancing loans, continue to flexibly extend credit growth limits so that credit institutions have more resources to reduce interest rates and provide credit. for economic recovery, help businesses access new low-interest loans without having to take out asset mortgages to restore production.

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