It is forecast that the production and business situation in 2021 will still facemany difficulties amid the COVID-19 pandemic. Businesses will continue to experience a difficult and unpredictable year to "surmount the pandemic"; many businesses have proposed support policies closer to reality.

VASI proposed that the Government extend support packages for businesses until
the end of 2021, reducing the requirements and conditions for businesses to access.
Illustration: Internet

Stabilize the source of input materials

Supporting industry enterprises all operate in industrial parks, the risk of disease spread is always present, threatening to disrupt production and cause great damage to the supply chains of multinational corporations in Vietnam and over the world.

According to the Association of Supporting Industries (VASI), in 2020 and 2021, the Covid-19 pandemic has had a great impact on supporting industry enterprises, causing high production costs and raw material prices,virusprevention and control costs, as well as increasing logistics costs.

Old orders decreased, making it difficult to reach customers and new orders, these caused 2020’s revenue to decrease by an average of 30% compared to 2019.

In addition, unstable personnel and workers due to cases of isolation or social distancing, difficulty in recruiting and retaining workers are also difficulties forsupporting industry enterprises.

According to VASI, due to the adjustment of the global supply chain, about 20% of supporting industry enterprises have the opportunity to increase orders and expand production, but face difficulties when the land rental price in industrial parks is limited and too high, preferential credit is not accessible, so businesses donot have enough capital to invest in production expansion.

In order to support businesses to overcome difficulties as well as effectively taking advantage of opportunities that the pandemic may bring, VASI hopes that the Government will unify the common rules of classification against Covid-19 across the country. At the same time, VASI also proposed that the Government extend support packages for businesses in 2020 until the end of 2021, reducing requirements and conditions for businesses.

Defer payment of additional taxes and obligations from six months to a year such as delay in payment of insurance premiums (social insurance, unemployment insurance, and trade union fees), land tax payment and VAT payments.

In particular, VASI also proposed to be supported to reduce loan interest rates from commercial banks; support access to production premises suitable for small-scale supporting industry enterprises (under 1,000 m2) and reduce land rental prices. In addition, there is a long-term and sustainable solution to ensure a stable source of input materials for the manufacturing industry.

Raise support level to 50%

As an industry heavily affected by the Covid-19 pandemic, the airline business is facing great difficulties. According to the forecast of the International Air Transport Association (IATA), the global passenger transport volume by air in 2021 is only 33% compared to 2019.

Possibly, the world aviation market until 2024 can recover to the same scale as the pre-pandemicperiod. For Vietnamese airlines, 2021 is still a difficult year; this trend may persist until mid-2022.

Regarding the proposal of support levels for aviation businesses, Mr. Pham Viet Dung, Chairman of the Vietnam Aviation Business Association (VABA) suggested reductions in fees and charges directly related to the operations of airlines, including fees for franchising the operation of airports and airfields; customs fees, fees for entry and exit of airports and airfields for foreign flights to Vietnamese airports; fees for assessment and issuance of certificates, permits and certificates in civil aviation activities; granting permits for access restricted areas at airports and airfields is 50%, not just 10% as specified in the Draft Circular stipulating the rate of collection of a number of fees and charges to assist and remove difficulties for production and business, ensuring social security to cope with the Covid-19 pandemicis being consulted by the Ministry of Finance.

At the same time, VABA also proposes to extend the time to reduce fees and charges for aviation businesses until the end of 2022, at least until June 30, 2022 (according to the draft time for the reduction of fees and chargeslasts until the end of December 31, 2021).

Many policies issued in 2020 were only expected to be valid until the end of 2020 but have been extended. Extending the time from the outset will help airlines proactively develop a more consistent response plan.

Evaluating the recent support policies as well as business support packages in the future, Vice President and General Secretary of the Hanoi Association of Small and Medium Enterprises (Hanoisme) Mac Quoc Anh said that in the context of the pandemic, most of the manufacturing industries in Vietnam were impacteddue to the disruption of supply chains. However, with good control of the pandemic, Vietnamese enterprises have a lot of advantages compared to businesses in the same industry abroad.

Regarding some policies to support employees in the context of the prolonged Covid-19 pandemic, Mr. Mac Quoc Anh assessed that most businesses have not yet benefited because the accompanying support conditions are difficult to implement. The draft amendments and guidelines for the Government's upcoming support package currently only expand the beneficiaries, but do not change the guarantee conditions for receiving support. This is one of the reasons why the policy has not been consistent with reality.

“We suggest that leaders at all levels need to improve administrative procedures to be faster, more transparent and complete information on criteria and procedures for receiving, identifying the right beneficiaries with appropriate and specific criteria, especially need to closely monitor the use of support to ensure the effectiveness of the policy. This support package can be based on index evaluations, to be divided into small and medium-sized enterprises and to offer packages suitable to industries for businesses. And especially, there is a need for solutions to help support policies come to life more quickly," Mr. Mac Quoc Anh said.