It is necessary to have a policy to prioritize industries with spillover effects

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VCN – From the socio-economic results of the first quarter of 2023, it shows that many solutions are needed to promote growth and stabilize production and business to ensure great balances of the economy. Ms. Pham Thi Ngoc Thuy, Director of the Office of the Research and Development of the Private Economy (Board IV, under the Prime Minister’s Advisory Council for Administrative Procedure Reform) shared about the difficulties of enterprises and there should be an industry priority mechanism to create spillovers.

Difficult economic situation to affect and put great pressure on fiscal policyDifficult economic situation to affect and put great pressure on fiscal policy
Central bank cuts policy interest rates to spur growthCentral bank cuts policy interest rates to spur growth
It is necessary to have a policy to prioritize industries with spillover effects

Ms. Pham Thi Ngoc Thuy, Director of the Office of the Research and Development of the Private Economy (Board IV, under the Advisory Council for Administrative Procedure Reform of the Prime Minister).

Ma’am, can you give some assessment on socio-economic indicators in the first quarter of 2023?

The indexes for the first quarter of 2023 are also the ones that Ban IV has forecasted at the end of 2022. The basic difficulties of the current business are money to operate and orders from the market are still very tense. Q1 data continues to prove that difficulty through business data.

For example, the data of the agricultural sector is considered a bright spot because compared to other sectors, at least there are no difficulties in the market. However, there is another concern. When working with a lot of businesses, they said they continue to be stressed due to lack of capital. Because purchasing agricultural products must have money, when the harvest period/crop in large quantities, if businesses do not have money, there is no way. Seeing an opportunity but not taking advantage of it just due to the story of lack of capital.

What do you think about the actual difficulties of enterprises in general and the private sector in particular?

Difficulties have been shown in the report at the end of 2022 of Board IV, but unfortunately at this time, these are still existing difficulties and the solutions are not clear. In that context, a constant worry for businesses is green growth. While the problem of survival is already a challenge, businesses must immediately face the problems that have become mandatory in the world. In the past, stories about “green production” could be an option, but now there are industries that have to face this regulation right away.

For example, the CBAM (European Union (EU) Carbon Border Adjustment Mechanism) came into effect in October and immediately affected five industries: steel, aluminum, fertilizer, cement, and electricity. In October, the regulations took effect on how businesses will adapt, although there are 3 years for parties participating in the supply chain with Europe to adapt to technical requirements. But in those 3 years if there is no orientation, how can businesses approach?

Or as regulations, enterprises must inventory greenhouse gases. In March, the regulations had to be implemented and enterprises made reports to the specialized departments but there is no technical guidance yet. The problem is that there needs to be very specific guidelines as well as a strategy to conquer the new challenges that the world market is posing.

The resources of the business are very difficult, obviously cash flow is very important. In your opinion, with the bank’s recent move, has the business accessed capital or not, where is the biggest bottleneck to remove?

In the recent business contact, Board IV worked with very large enterprises in the field of logistics and received a share, although interest rates tend to be lower, but for businesses it is still too high. It may not be difficult to get a loan, but it is stressful for lending interest rates to be included in production and business accounting.

Currently, businesses in all industries are facing difficulties, everyone proposes their own difficulties, but in general, we hope the Government will evaluate to see what is the spearhead and what is the priority. Because there are industries that have spillover effects on other industries. Recently, special recognition of the determination of the Government and ministries on the visa mechanism. It’s a huge hit for the tourism industry. From viral travel to trade and investment. But there are other industries that are also pillars that are also contagious. In the context of general difficulties, the force is not strong due to the spread, then it is not feasible, so it is better to think about priority mechanisms.

Thank you ma’am!

By Ngoc Linh (write)/Phuong Linh

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