The Red River Delta province of Thai Binh is expected to increase its number of small and medium-sized enterprises (SMEs) by 1,350 between now and 2015 in a bid to step up the development of these types of businesses and raise their contribution to provincial growth and economic restructuring.

Under the plan, SMEs in Thai Binh will reach 4,688 in the reviewed period while the investment of these enterprises will account for around 14 percent of the province’s total social investment.

The SME sector will contribute 13.21 percent of the province’s annual GDP growth and 1.59 trillion VND (74.73 million USD) of local budget as well as earn about 1.2 billion USD from exports, equivalent to 50 percent of local export turnover.

To realise the goal, Thai Binh will give priority to expanding its SMEs in all fields, focusing on high value-added and competitive products.

The province will also promote the reform of administrative formalities in business and investment registration and direct local banks to lower lending rates to stimulate the sector’s business and exports.

In addition, more industrial parks and clusters with convenient facilities will be established to boost SME investment. The province also supports these firms to improve their technical level and apply advanced technologies to raise productivity, quality and competitiveness of products in domestic and foreign markets.

As of the end of 2012, Thai Binh had over 3,300 SMEs, making up more than 90 percent of the province’s total number of enterprises, noted the provincial Department of Planning and Investment. The sector contributes more than 500 billion VND (23.5 million USD) of Thai Binh’s annual budget while raising about 350 million USD from exports and generating jobs for around 72,000 workers.

However, the operational quality and effectiveness of local SMEs remain poor and unsustainable as many have not yet prepared a precise business strategy.

SME owners lack knowledge of legal regulations and business management while a number of the firms use backward technologies and must rent premises for production, which results in a higher risk of environmental pollution and an increase in production costs.

The province needs to soon perfect its mechanisms and policies to back the sustainable development of SMEs, according to Secretary General of the Thai Binh Business Association Ngo Van Dung.

Specifically, it is vital to ease SMEs’ three great difficulties including premises for production, capital and management skills.

The province also needs to provide more information on domestic and foreign markets to help the firms orientate their production and business, Dung said, adding that his association will establish a centre to offer support and consultation to local enterprises in the coming time.-VNA