Although the number of enterprises is still increasing, most of the dissolved or suspended enterprises are SMEs with registered capital of under 450,000USD. According to experts, part of the reason is because SMEs are facing many difficulties, such as lack of capital, increasing wages, and input material costs.
Vietnam is integrating into the international market more deeply. As a result, Vietnamese enterprises are more vulnerable to policy changes by larger nations. The recent devaluation of the Chinese Yuan is a typical example.
Lack of capital is a common issue for SMEs. As bad debts refuse to go away, banks are tightening loan conditions. It's getting more difficult for SMEs to get loans. One solution being utilised by SMEs is to scale down production.
SMEs account for 95% of businesses in Vietnam, and contribute greatly to the state budget and job creation. In the context of economic integration and fiercer competition, preferential policies by the Government will play a crucial role in facilitating SMEs
