Help us, major private firms tell government

By Anh Minh   March 13, 2020 | 07:58 am GMT+7
Help us, major private firms tell government
Police stand outside a hotel in Hai Chau District, Da Nang City where 48 people were quarantined on March 11, 2020 after two guests tested positive for the novel coronavirus. Photo by VnExpress/Nguyen Dong.
Vietnam’s major private companies in hospitality and aviation industries are requesting government assistance as the Covid-19 epidemic slashes their revenues.

A spokeswoman of Sun Group said Thursday that the number of customers to its entertainment complexes has dropped by two million year-on-year in the first two months.

An estimated drop of seven million customers is expected in the first six months, she said at a meeting between Prime Minister Nguyen Xuan Phuc and representatives of major private companies.

Revenue from entertainment, which accounts for 70 percent of the group’s total, is set to fall VND2 trillion ($86 million) because of the epidemic, the Sun Group spokeswoman said.

Occupancy at its resorts and hotels have fallen 10-20 percent, and the group has suspended plans to launch new facilities and shut down some others, she said, adding: "The company’s revenue and staff’s income are severely hurt."

A spokesperson for budget carrier Vietjet said their revenue in the first quarter had dropped by half year-on-year. Its plan to launch new routes to India has been suspended, and the company has had to cut staff salary by 30 percent.

The Civil Aviation Authority of Vietnam (CAAV) had earlier estimated that local airlines will have to bear losses of VND25 trillion ($1.08 billion) in revenue because of the Covid-19 epidemic.

Truong Gia Binh, chairman of tech giant FPT, said three fourths of companies in Vietnam could go bankrupt if the epidemic lasts over six months, citing a survey by the government’s Private Economic Development Research Board.

Sixty percent of businesses could see their revenues down by over half, he said. 

Vietnamese small and medium-sized businesses with limited resources would be victims of the epidemic and they need to make plans to mitigate the adverse effect and ensure their employees do not lose their jobs, he said.

Other companies like hospitality firm BRG and automaker Thaco also reported challenges and asked for incentives in taxes and credit to overcome the crisis.

Vietjet proposed a reduction or removal of environmental tax on aircraft fuel, which is now at VND3,000 (13 cents) per liter, or 22 percent of fuel cost.

"We expect that a lower interest rate for two or three years can help the business recover."

Prime Minister Nguyen Xuan Phuc said the government will issue a program to support businesses in terms of taxes, fees and insurance.

The Finance Ministry has proposed a decree to delay the tax payment deadline by five months for businesses affected by the epidemic, covering about VND30 trillion ($1.3 billion) worth of taxes.

The government is also drafting an economic recovery plan after the epidemic, Phuc added. "We need to work three times harder to overcome the (Covid-19) epidemic impacts," he said.

Vietnam has recorded 28 new novel coronavirus patients in the last five days, bringing the total to 44, 16 of whom were discharged weeks ago. It has issued several travel bans, cancelled flights to Covid-19 epicenters and imposed strict quarantine regimens on people coming in from affected countries and territories.

 
 
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