The Ministry of Planning and Investment (MPI) will prepare a report on the efficiency of existing and new policies and support packages for businesses amid the COVID-19 pandemic, to determine the most suitable for application in the short and long terms, Minister of Planning and Investment Nguyen Chi Dung has said.

Workers at a footwear export firm 

He explained that if economic policies are not strong enough, then it will be difficult for the country’s economy to recover.

The minister asked relevant ministries and agencies to evaluate business and production conditions to sketch an overall picture that allows for the easier designing of policies for each sector and the re-building of growth scenarios.

Ministries and agencies were also asked to calculate variables and build models taking impact factors into account so as to assist in preparing support packages that are timely and sufficiently strong.

According to a report from the General Statistics Office, COVID-19  has had an adverse impact on most socio-economic sectors but in particular aviation, tourism, accommodation, and catering. Many companies in these sectors have been forced to dissolve, have announced bankruptcy, or have halted or narrowed operations, while their employees have had to accept pay cuts or even terminations.

Some 17.6 million people have seen their salary cut because of COVID-19.

The proportion of businesses  registering to cease operations rose 41.5 percent in the first seven months of this year, while the unemployment rate has reached its highest level in a decade.

A number of measures to support small- and medium-sized enterprises have been introduced, along with policies to help large companies overcome difficulties in cash flow due to huge declines in revenue.

The ministry has already suggested that existing support policies be extended to the end of December, but due to the complex developments of the pandemic it will propose they are extended well into 2021, Dung said.

The minister also underlined the need to continue extending payment times for a number of taxes in line with Government Decree No 41/2020/ND-CP to the end of the year.

According to MPI, it is crucial to extend the timeline for implementing policies regarding the restructuring of debt repayment timeframes and exemptions from and reductions to interest rates and fees while retaining the debt classification of pandemic-hit borrowers under State Bank of Vietnam Circular No 01/2020-TT-NHNN.

It is also necessary to extend support to customers who have obligations to pay original debt and/or interest from January 23 to December 31, 2020, while adjusting the circular to make it easier for businesses to access the policies on offer.