During the 2017-20 period, the contribution of the private sector to the GDP has been on the steady rise from 41.75% (2017) to 42.68% (2020), making up the largest proportion among economic sectors.

Deputy Prime Minister Truong Hoa Binh at the meeting. Photo: Le Son.

Deputy Prime Minister Truong Hoa Binh made the statement at a meeting with the Vietnam Association of Small and Medium Enterprises (VinaSME) on January 7.

Vietnam is currently home to nearly 800,000 operational enterprises, 98% of which are small and medium ones. The ratio of business establishments per 1,000 population rose to 7.9 from 5.4 in 2016.

“There have been significant improvements in the private sector, especially in productivity, technological application, innovation and capabilities to participate in regional and global supply chains,” noted Mr. Binh.

Nevertheless, Mr. Binh pointed out certain shortcomings of the business community, including the majority still possess obsolete technologies and lack vision for innovation, research and development.

“The linkage among members in the VinaSME remains fragmented, while many are unable to access capital for development,” he added.

“Local companies should be aware of environmental issues and refrain from trade frauds, violation of intellectual property rights, and tax evasion,” Mr. Binh suggested.

As the Covid-19 situation continues to be complicated globally, not to mention climate change, natural disasters and non-traditional security issues, the Vietnamese business community should enhance resilience to better adapt to a new normal situation, stated the Deputy PM.

In the coming time, Mr. Binh expected the VinaSMe to continue staying active in addressing concern of businesses.

“Vietnamese companies should start taking technologies and machines to replace basic works for greater competitiveness,” he said.

Vietnam SMEs are an essential part of the economy, contributing 40% of the GDP, 33% of industrial production value, 30% of exports and creating jobs for 50% of the labor force.