Vietnam should provide more support for small- and medium-sized enterprises (SMEs) to help them improve capacity and competitiveness, said Alain Chevalier, chief advisor for a SME assistance programme.

At a recent seminar on Vietnam-France trade and investment promotion held by the Ministry of Industry and Trade (MoIT), Chevalier praised the fine adjustment made by the Vietnamese Government in the scale of State-owned enterprises (SoEs).

Further assistance to SMEs and a reduction in the number and scale of SoEs have demonstrated Vietnam’s sound policies, he was quoted as saying by radio the Voice of Vietnam (VOV).

The advisor noted that Vietnamese people are very intelligent and creative, with many initiatives for developing the household economy and if they receive the right support, they can develop SMEs effectively.

With enormous potential for developing service and manufacturing sectors, SMEs can team up with large groups to engage in the support industry. They are also enjoying favourable conditions to enter such fields as information technology, tourism and finance, he said.

However, the advisor pointed out some hurdles facing SMEs, including limited access to financial sources which puts them in a difficult position to pay taxes, apply advanced technology and sharpen competitive edge.

His view was shared by Hoang Gia Media Group General Director Hoang Hai Au, who said local businesses, especially SMEs, are suffering numerous challenges due to weak liquidity, low purchasing power and large inventories.

It’s difficult for Vietnamese businesses to compete against foreign rivals and stand firm on home turf as they have to pay high interest rates of bank loans. In addition, local firms are struggling to protect their trademarks in the face of invasion by foreign companies, Au elaborated.

He said that in many countries, including the US, SMEs are considered a great source for job generation and GDP contribution, while giant groups create reputation and represent a country on the global market.

Vietnam’s Enterprise Law (revised) is expected to help SMEs iron out teething problems and operate more efficiently, he added.

The advisor suggested Vietnam learn experience from developed countries in assisting SMEs in their fledgling period. The Government should assist SMEs who are in need of technical assistance, zoning plans and development strategy.

In Switzerland, SMEs are regarded as the backbone of economic growth, and the government is willing to help them with investment capital and technology, he said, citing Nestle as an example.

As a one-member firm previously, Nestle was then expanded, and soon became a globally renowned brand name. Thanks to its flexibility, creativeness and self-recovery ability, Nestle has generated huge job opportunities and overcome difficulties and challenges caused by the world’s economic downturn, the advisor noted.

He hailed SMEs’ crucial role in boosting Vietnam’s economic growth, apart from valuable inflow of foreign direct investment (FDI).

Regarding business consultation, Au emphasised the need to provide stronger support for SMEs and introduced a programme called CEO SME 2014 that aims to help local businesses improve management and administration capacity.-VNA