New business formations in Vietnam in October rose by a sharp 18.4% month-on-month to 12,200, according to the General Statistics Office. 

37,700 enterprises resumed operations in the first ten months of this year. Photo: Pham Hung.

This month has also witnessed a decline of 18.5% month-on-month in combined registered capital to VND165.6 trillion (US$7.14 billion) and a fall of 12.7% in the number of workers hired by new enterprises to 72,400.

The number of newly-established enterprises in Vietnam in the first ten months of 2020 was 111,200 with registered capital of a combined VND1,594.1 trillion (US$68.8 billion), down 2.9% in number but up 11.1% in registered capital year-on-year. Average registered capital per newborn enterprise was VND14.3 billion (US$617,122) during this period, up 14.4% year-on-year.

Taking into account VND2,298 trillion (US$99.17 billion) of additional capital pumped by active enterprises, total registered capital injected into the economy in the January-October period was VND3,892.1 trillion (US$168 billion), up 17% year-on-year.  

The government-run office informed that 37,700 enterprises resumed operations in the period, an increase of 8.2% inter-annually, bringing the total number of newly-registered and reinstated enterprises in the ten-month period to 148,900, down 0.3%.

The GSO added that the number of laborers of newly-established enterprises between January and October was 850,300, down 2.9% against the same period last year.

During this period, the number of enterprises temporarily ceasing operations surged 58.7% year-on-year to 41,800.

Moreover, the number of enterprises which completed procedures for bankruptcy was up 0.1% to 13,500.

Since the outbreak of the Covid-19 pandemic, the Vietnamese government has been implementing a wide range of support for the business community, with the latest move being a cut of 30% in the corporate income tax for enterprises having their revenue of less than VND200 billion (US$8.61 million) in 2020.

Additionally, other supporting programs consist of a credit aid package worth VND300 trillion (US$12.87 billion), including a VND180-trillion (US$7.63 billion) fiscal stimulus package in forms of delay of payment of value-added tax, corporate income tax, and a financial support package for vulnerable people worth VND62 trillion (US$2.7 billion).