HCMC aims to convert 250,000 household businesses into SMEs by 2020

By Le Chi   July 4, 2016 | 09:00 pm GMT+7

Ho Chi Minh City aims to double its private firms to 500,000 in the next four years, said secretary of the city’s Party Committee, Dinh La Thang.

“The target is not elusive. We can reach it by sheer determination,” said Thang.

Ho Chi Minh City currently has 250,000 household businesses. The city plans to double the figure by turning family businesses into small and medium-sized enterprises (SMEs), according to the city’s leader.

Vietnam has set a target of having five to 10 business conglomerates that rank in the top 300 in Asia, said the chairman of Ho Chi Minh City's People’s Committee, Nguyen Thanh Phong, adding that as the main economic driving force of the country, the city should be home to conglomerates capable of leading the business community.

However, some people are less confident about the target for new businesses.

“The city has a population of 10 million people, or around 2 million households. The target says that [by 2020] one in every four families will be running a business. It is unrealistic,” Chairman of the Rubber and Plastics Association Nguyen Quoc Anh said.

Anh cited a report recently released by the Vietnam Chamber of Commerce and Industry (VCCI) that shows Vietnamese businesses are increasingly getting smaller.

According to the VCCI report, many businesses are not big enough in terms of capital and revenue to be ranked as small and medium-sized companies.

Anh added that it's not size that counts; it's competitiveness.

Ho Chi Minh City is striving to develop into a smart and dynamic part of Asia; to become the country's talent hub where investors and start-ups flock together, and to thrive on a sustainable market-based economy, said Prime Minster Phuc in a meeting last week with the city’s leaders.

The PM said the southern commercial hub should boost its economic growth with a focus on technological innovations and high-value services.

The city must become “the pearl of the East Sea”, said Phuc.

Ho Chi Minh City has also earmarked VND30 billion ($1.3 million) for a start-up investment fund, which is expected to provide local entrepreneurs with the funds they need to develop their products, services and technologies.

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