More effort needed to boost exports

Most of domestic businesses going bankrupt in recent times are private ones which have been seriously affected by the impact of economic slowdown.

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  • According to a recent survey by the Ministry of Planning and Investment, 66 percent of businesses say they have to reduce production because of low consumer demand, 53.6 percent put this down to the lack of capital and 50 percent claim to be running short of input materials.

    Judging by export performance in the first six months of this year, economist Pham Chi Lan says it is urgent for domestic enterprises to get a leg up on international competition.

    Despite Vietnam’s constant export growth, they are losing ground to foreign enterprises, Lan says.

    The biggest problem for exporters is that 42.2 percent of them want to borrow capital from commercial banks in stead of mobilizing capital from equitization and stock exchange deals.

    This is quite contrary to the principle of promoting medium- and long-term investment in the form of initial public offering (IPO) and equitization.

    Other economists insist that export businesses should take the initiative to work out their own plans and translate them into reality.

    Pham Dinh Toan, Deputy General Director of the OSB Investment and Technology Joint Stock Company, says many domestic businesses are shifting to online exports.

    In his opinion, they should restructure their operations in the first place before seeking new markets to supplement the traditional ones.

    Vietnam has great potential for e-commerce to develop. There are 134 phones per 100 people on average, 35.29 percent of its population use the internet, 15 percent apply for third-generation (3G) wireless mobile communication services, and 38 million have ATM cards. Le Van Loi, Director of the Institute of Information Technology for Business (ITB) under the Vietnam Chamber of Commerce and Industry (VCCI), says 96 percent of domestic businesses are of small and medium size with limited investment in information technology.

    The best solution for them, he suggests, is to promote their sales and marketing in a practical way if they want to stay alive in the time of e-commerce.