The Great Business Disappearance: Unraveling the Mystery Behind the Vanishing Act While Economic Indicators Soar.

Understanding Vietnam’s Economic Landscape: Decoding Business Survival and Prosperity

In a recent article, a leader from FPT shared an insightful perspective on how the media and the public have long considered the number of ceased businesses as a key indicator of Vietnam’s economic health.

Citing concerns raised by the public, such as “Over 110,000 businesses have disappeared,” “More than 111,600 businesses have withdrawn from the market,” “The economy is facing significant challenges,” and questioning the discrepancy between these figures and the positive economic indicators being reported.

However, Mr. Bao clarified that the figure of 111,600 businesses ceasing operations in the first five months of 2025 is merely a statistical artifact within the management system and does not accurately reflect the actual number of businesses that have ceased operations in the market during this period.

He explained that, according to current regulations, the temporary suspension of a business’s operations can only be valid for a maximum of one year. After this period, the business is required to repeat the suspension procedure, and there is no distinction made between the first and subsequent suspensions in the notification (which is used for statistical purposes by management agencies)

As a result, a single business could be counted four to five times or even more in the number of temporarily ceased businesses unless it is dissolved or goes bankrupt (which is rare) or resumes operations. For instance, if Company A temporarily ceased operations in June 2021 due to the Covid pandemic and had to repeat the notification process in June 2022, 2023, 2024, and 2025, it would be counted as five separate cessations, even though its operational status remained unchanged.”

To illustrate this point further, Mr. Bao provided an analogy of a hospital’s patient admission policy. Suppose a hospital has a rule that a patient can only be treated as an inpatient for a maximum of seven days. Even if the patient’s condition hasn’t improved, on the eighth day, they must go through the discharge process and then readmission (even if they remain in the same bed without physically leaving). In this scenario, the hospital would record five new patients in five weeks, despite there being no actual new admissions.

Therefore, the accurate metric for gauging the number of ceased businesses in a given period is to count only those that have ceased operations for the first time and exclude those that continue to be inactive, as they are already reflected in the previous count.

Mr. Bao then presented a hypothetical breakdown of the 111,600 ceased businesses: 44,600 ceased operations for the first time, 12,000 for the second time, 15,000 for the third, 18,000 for the fourth, and 22,000 for the fifth. With these figures, he calculated that in the first five months of 2025, there were 44,600 new ceased businesses and 111,800 new businesses established or resumed operations.

In conclusion, Mr. Bao asserted that the economic landscape is much more positive than previously understood. He emphasized the importance of accurate data reflection, stating, “Numbers speak louder than words, but only when they accurately represent the true nature of things.”