Number of new businesses, registered capital highest ever

In terms of volume, the figure was up 5.2 percent year-on-year, while their registered capital also climbed a new high at over VND1,730 trillion ($75.1 billion), up 17.1 percent year-on-year, according to the General Statistics Office.

This meant the average registered capital was VND12.5 billion ($542,000) per business.

An additional 39,400 businesses resumed operations this year, up 15.9 percent from last year. But the year also saw 43,700 businesses filing for dissolution, up 41.7 percent year-on-year.

The surge in the business numbers and registered capital is happening as the government seeks to improve its administrative policies to support enterprises as part of a plan to have the private sector spearhead economic growth.

Prime Minister Nguyen Xuan Phuc said at a meeting with business leaders on December 23 that the large number of businesses dissolving each year, including big ones, was a matter of concern.

Government agencies have been making proposals in this regard. In July, the Ministry of Finance proposed to the National Assembly that it considers scrapping corporate income tax on micro and small enterprises.

There are about 760,000 businesses operating in the country. Vietnam targets taking this up to 1 million next year.

Vietnam’s GDP growth of 7.02 percent in 2019 exceeded the parliament’s target of 6.6-6.8 percent as well as forecasts by several international organizations like the WB and the ADB. It had slowed from a record 7.08 percent in 2018, but remained the second highest growth figure in the last decade.