In the first two months of this year there were 41,100 enterprises newly registered or that went back into operation after a hiatus, in Vietnam, according to Doanh Nhan Vietnam. There were, however, 63,000 businesses that withdrew from the market at the same time–a net-closure of 21,900 businesses.
This is unusual with new businesses usually exceeding closures, Nguyen Minh Thao, head of the Business Environment and Competitiveness Research Committee (CIEM), told the publication.
She goes on to say that businesses are essentially run down after two years of ongoing challenges–COVID-19 created a myriad of economic challenges that have not eased in the past two years.
These ongoing challenges are elucidated by Dau Anh Tuan, Deputy Secretary General, Head of the Legal Department of the Vietnam Confederation of Commerce and Industry. He told Doanh Nhan that external conflicts are weighing on the local economy, in particular, the delays the conflict in Gaza has caused to shipping in the Red Sea.
The article goes on to suggest policy support, specifically extending the value added tax reduction currently in place to the end of the year.