Thang Long - Hanoi

Business closures pass 26,000
03/07/2012 | 14:23:37
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Unable to cope with difficulties caused by the global economic crisis, 26,340 Vietnamese businesses have suspended operations or shut down in the first six months of 2012, a year-on-year increase of 5.4 percent, the General Statistics Office (GSO) says.

According to figures released by the GSO in Hanoi on June 29, the number of enterprises dissolved, at 4,105, marked a year-on-year increase of 35.4 percent, showing businesses were finding it increasingly difficult to survive in the current environment.

In June alone, 4,110 firms declared bankruptcy or suspended operations. Of these 610 were dissolved.

Of the 11,329 foreign-invested enterprises, 232 firms (two percent of the total number of registered FIEs in the country) have temporarily suspended operations, 696 enterprises (6.3 percent) are about to be dissolved because of losses or changes in the investment environment.

About 23,000 State-owned enterprises (SOEs) have suspended operations while over 30,000 other SOEs could be dissolved.

Lam said SOEs, which are most "vulnerable" in the current state of economic turmoils, need more support from the Government.

According to the GSO, 27 percent of surveyed interviewed said high interest rates are the biggest challenge facing their business; 19.5 percent blamed high inflation and economic changes; 17.4 percent cited difficult access to capital; 9.7 percent, high transportation costs; 7 percent, unstabe electricity supply and another 7 percent, macroeconomic policices.

Meanwhile, the HCM City Department of Labour, War Invalids and Social Affairs has reported that over 4,800 HCM City-based businesses reduced their work force in the first four months of 2012.

According to the department’s recent survey, over 16,700 workers from the construction, chemicals, mechanics and service sectors have been sacked.

The survey also revealed that the workers were sacked because their employers faced bankrupcy, disintegration, suspension of operations and other difficulties due to the economic crisis.

In addition, many other businesses have had to reduce the work hours of their employees due to a shortage of orders for their production and processing lines.-VNA
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