Over 20 thousand businesses on hold in Q1/2016

By Bach Duong, Lam Le   March 28, 2016 | 11:30 am GMT+7
Over 20 thousand businesses on hold in Q1/2016

In the first quarter of 2016, 20,044 businesses suspended activities, a 23.9 percent rise compared to Q1/2015, the General Statistics Office (GSO) said March 25.

However, there were 23,700 newly registered businesses (a 24.8 percent rise compared to Q1/2015) with capital totaling VND186 trillion ($8.3 million), a staggering 67.2 percent increase, announced GSO in Vietnam’s socio-economic report.

Average registered capital was VND7.8 billion (35.4 percent increase). The newly registered businesses in Q1/2016 are forecasted to create 322,000 jobs, a 21.5 percent increase.

Over 9,000 businesses resumed activities, a significant jump of 84.1 percent compared to last year.

However, moderate domestic growth coupled with slow growth globally has taken its toll on Vietnamese businesses.

Almost 3,000 businesses filed for bankruptcy in Q1/2016 (a 13.8 percent increase), most of which were small scale with registered capital of less than VND10 billion.

Director General of General Statistics Office Nguyen Bich Lam said that the number of bankruptcies is not a cause for concern given the number of newly registered businesses, which have already created 200,000 jobs. Furthermore, most of the bankruptcies were among small businesses with less than VND10 billion in capital.