Nearly 60,000 businesses withdraw from market
The number of newly established enterprises is still increasing, but the rate of businesses withdrawing from the market has also risen.
Vietnamese businesses face many difficulties because of the Covid-19 pandemic. Photo: Luong Bang
According to the business registration report in May 2021 from the Business Registration Administration, the total number of enterprises entering and re-entering the market in May 2021 was 16,495 (an increase of 4.5% year on year), including 11,603 newly established enterprises (up 8.2%) and 4,892 enterprises resuming operation (down 3.2%).
Of more than 11,600 newly established enterprises, the registered capital reached VND150,606 billion (up 33.6% in registered capital over the same period of 2020). This figure does not include the huge capital of VND525 trillion registered by two companies in Ho Chi Minh City. The average registered capital was VND13 billion, up 23.6% year on year.
In May 2021, 4,892 businesses resumed operation, down 3.2% year on year. In this month, 8,913 businesses withdrew from the market, up 20.7% year on year.
In the first five months of 2021, the total number of enterprises entering and re-entering the market was 78,333 (up 11.9% over the same period of 2020).
The number of newly established enterprises in the first five months of 2021 was 55,769, an increase of 15.4% over the same period in 2020. This was the highest number of newly established enterprises in the first five months of the year in the period 2016-2021. The increase in the number of newly registered enterprises shows the trust and expectation of the business community in future economic prospects.
The total amount of additional registered capital in the first five months of 2021 was more than VND1.75 million billion (an increase of 27.5% year on year).
The number of businesses resuming operation in the first five months of 2021 was 22,564, up 3.9% year on year.
The number of enterprises withdrawing from the market in the first five months of 2021 continued to increase, with 59,820 enterprises, an increase of 23% over the same period of 2020. Of which, 31,818 enterprises temporarily stopped doing business, accounting for 53.2% of the total number of enterprises withdrawing from the market in this period.
Most of the firms that had to suspend their business or were dissolved were those that had been operating for less than five years on a small scale, mainly in the commercial sector. These are very vulnerable to negative external influences.
In the first quarter of 2021, the number of businesses withdrawing from the market was higher than the number of newly established ones. The Covid-19 pandemic continues to affect production and business activities in Vietnam.