Orders to restore the economy

	Government leader calls for major efforts to revitalise national economy
	Fiscal policy is an important support for the economy before the Covid-19 pandemic
	Vietnam hopeful of opening economy to pre-pandemic levels

The effort of the business is one of the important factors to restore the economy. Photo: Internet

Accordingly, the Prime Minister requested the Ministry of Industry and Trade, related ministries and branches to focus and urgently promote the signing of export contracts with EVFTA countries and prepare necessary conditions and goods to deploy as soon as the country removes the blockade. Along with that, we continue to review and ensure the transport and supply of raw materials for production and export. In particular, the Prime Minister required to promote the development of the domestic market, take measures to stimulate demand, boost consumption and gradually reopen domestic tourism as well as actively research and develop a start-up plan back to socio-economic activities.

After the above Directive was issued, the Ministry of Industry and Trade had a meeting with a number of key associations and key sectors in the field of agricultural, fishery and industrial products to discuss overcoming difficulties and solutions to boost exports after the Covid-19 epidemic. At this conference, representatives of a number of business associations such as the Textile Association, Pulp and Paper Association, etc. said that the financial support package has not yet reached businesses, while proposing to promote banking operations, more flexible in procedures and policies for businesses to access capital, ensure production and business, and so revive the economy.

Besides, to support businesses, many business associations also proposed solutions for businesses to have the opportunity to survive, restore production and business before it comes to development. Accordingly, the associations proposed to exempt union fees instead of postponing payment in 2020 or reduce union fees from 2% to 1% and apply this to all businesses.

Recently, the Private Economic Development Research Department under the Government Reform Administration Advisory Council also sent a proposal to the Ministry of Planning and Investment, which proposed free union fees to enterprises until the end of the year. According to the Department of Private Economic Development ResearchCouncil, enterprises said that if they have to retire 50% of the total number of employees paying social insurance, it is equivalent to the situation where enterprises are exhausted, "clinically dead", they are unable to arrangefinancesto cover the above fees.

According to the newly released figures of the General Statistics Office, greatly affected by Covid-19, the number of newly established enterprises as well as the registered capital decreased sharply in April 2020. There weremore than 41,000 businesses withdrawing from the market in the first four months of the year, up 5.6% compared to 2019, along with millions of unemployed workers. Therefore, the health of businesses is a top priority,businesses should be empowered to overcome this difficult period. In this regard, Dr. Nguyen DinhCung, former director of the Central Institute for Economic Management, said that the number of solutions, scale and duration of applying financial and monetary support packages were built on the assumption that Covid-19 will be controlled domesticallyfrom the second quarter of 2020 and will announce the end of the epidemic, but so far it is not known how long the pandemic will last. Therefore, to revive the economyearly and to strengthen businesses' health, to prepare for the opportunity of the global economy to rebound after the pandemic, exemption and reduction are two words that need to be used more at this time.

Restoration with institutional reform

From the perspective of businesses, economist Le DuyBinh, CEO of Economica Vietnam, said that at this difficult time, supporting businesses and important assets of a country is very necessary. However, when participating in a market economy, enterprises must also be ready to prepare themselves and prepare for risks, including force majeure risks, and accept the rules of the market, not only rely on state support. No Government can guarantee normal operation, full support in a long time for all businesses. Enterprises should consider the state's support only a "life buoy", supporting the most difficult businesses, at the most necessary points to overcome difficulties.

“In times of crisis, if an enterprise can determine a reasonable expectation of state support, it will ensure better alertness and wisdom in the decision for the next options for their own businesses. In those plans of self-saving, it is not excluded the plan to narrow or withdraw from the market wisely to minimize losses, thereby maintaining resources to start a new game when the opportunity comes again,”expert Le DuyBinh said.

Evaluation of efforts to support enterprises through which the economic recovery is being implemented by the Government, according to economist, Dr. Vo Tri Thanh, member of Financial - Monetary Policy Advisory Council nationally, the control of epidemics coupled with the relaxation of "social distancing" and the support of difficult enterprises are important conditions for production and business to stand up during and after the pandemic. The current practice is to support businesses to hold on, maintain and create a premise for businesses to step up when the epidemic is controlled in Vietnam and globally. However, it is a process of many difficulties and challenges.

Besides, TS. Vo Tri Thanh also said that the foreign exchange reserves from the beginning of the year still increased, reaching $84 billion, and there were nearly VND700 trillion of public investment capital in 2020 and 2019, which has not been fully disbursed.

Accordingly, we need to accelerate disbursement effectively and this capital will have a positive impact on the economy and businesses. Regarding public investment, there were some positive signs as soon as the social isolation order was relaxed.

Accordingly, Ho Chi Minh City has simultaneously started construction of thirteen major transport infrastructure projects with a total capital of over VND3,500 billion. Hai Phong also inaugurated, started and broke ground for sixteen important infrastructure projects. The latest information from the Ministry of Transport said that the pre-qualification process for eight North-South PPP projects has been completed, the documents for adjusting eight investment projects have been adjusted in the form of public investment and is expected to start construction projects of investment transformation in August 2020 under the direction of the Prime Minister.

TS Nguyen DinhCung said that it is necessary to take immediate action so as not to miss new opportunities from the world's economic movements after the pandemic.

Accordingly, it is advisable to develop a plan for economic recovery and restructuring and transformation of the growth model under new conditions after the Covid-19 pandemic. “We should soon evaluate and complete programs to restructure the economy, in association with transforming the growth model towards improving productivity, quality, efficiency and competitiveness of an appropriate economy suitable with new requirements and conditions after a pandemic,” PhD. Nguyen DinhCung said.