“Unlocking Capital for Businesses: The Government’s Role in Lowering Interest Rates.”

On October 27, the National Assembly discussed the socio-economic situation and the state budget in groups. National Assembly Deputy (NA) Tran Thi Hien (Hanoi) stated that, in terms of context, it could be said that after the COVID-19 pandemic, the economic situation faced numerous challenges, including the impact of the pandemic, the slow recovery of the global economy, and the effects on Vietnam’s major markets. Natural disasters and climate change have also become more severe and intense.

However, thanks to the efforts, determination, and leadership of the Party, the Government’s administration, and the companionship of the National Assembly, the year 2024, especially the third quarter, has achieved rather optimistic results.

According to the NA deputy, the focus on growth and its promotion in 2024 is a very correct decision. 14 out of 15 targets have been met or exceeded, including impressive import and export figures. The challenging target of labor productivity in recent years has also been achieved, which is commendable. The Government’s report has mentioned other achievements, and the Economic Committee’s review report, as well as the Council for Ethnic Affairs and the National Assembly’s committees, have provided specific evaluations.

However, from a business perspective, Deputy Hien suggested that the Government should pay more attention to the business sector. Surveys and assessments by the General Statistics Office indicate that between 10% and 50% of businesses believe that 15 factors have impacted their operations in the past.

The most prominent challenges include low market demand, high competitiveness of domestic goods, debt in construction, prices of raw materials for production, financial difficulties, and high-interest rates…

“From the perspective of business operations, I believe these assessments are objective and reflect the reality,” said Deputy Hien.

In previous sessions, the NA deputy spoke about the difficulties in accessing capital. Although this issue has been addressed, it still needs more attention, especially regarding interest rates. Deputy Hien believes that the current interest rates are still high. Therefore, she requested that the Government and the State Bank soon study and adjust the interest rates to support businesses, which would also contribute to promoting credit growth (in the first nine months, credit growth was only 9%, while the target is 14-15%).

On another note, while the number of businesses has consistently increased over the years, from over 654,000 in 2017 to over 921,000 in 2023, and is expected to continue rising in 2024, it seems challenging to achieve the goal of developing 1.5 million enterprises by 2025, as stated in Resolution No. 58/NQ-CP dated April 21, 2023.

Moreover, the majority of Vietnamese businesses are small, with over 90% being small, micro, and medium-sized enterprises. Statistics also show that most businesses operating at a loss belong to this group.

Additionally, there should be more focus on the quality of businesses rather than solely their quantity. The proportion of profitable businesses is not high; for example, in 2022, less than 45% of the total number of over 735,000 operating enterprises made a profit, while 46.9% incurred losses, and only 8.5% broke even.