2015 is expected to see the largest number of newly-established enterprises ever, matched unfortunately by record numbers of dissolved enterprises.
More than 9,300 newly-established enterprises came into being during November, a 19.9 per cent increase year-on-year, with capital of VND52.6 trillion ($2.33 billion), a 35.5 per cent rise year-on-year, according to the Business Registration Agency (BRA) at the Ministry of Planning and Investment.
In the first eleven months the number of newly-established enterprises neared 86,900, a 28.1 per cent increase against the same period last year, with capital of VND538.7 trillion ($23.9 billion), or 37.7 per cent higher.
The number may reach 94,000 for the year as a whole, Deputy Director of the BRA, Mr. Bui Anh Tuan, believes. “This has been the highest number for many years and is a positive reflection on the Law on Enterprises, which came into effect on July 1.”
Not only the number of newly-established enterprises has increased remarkably since the law took effect, at 6,900 enterprises in July, 9,300 in August, 7,000 in September, and 9,200 in October, as additional capital has also seen a healthy increase.
In the last five months almost 134,600 enterprises increased their capital, a 151 per cent increase compared to the same period last year. In the first eleven months VND742.2 trillion ($32.98 billion) in total was added, for a total of VND1,280.9 trillion ($56.9 billion) in capital for the year so far.
In addition to the Law on Enterprises coming in effect, the automatic issuance of business codes for new enterprises within three working days also contributed to the huge increase in the number of newly-established enterprises, according to Mr. Tuan.
In November there were 2,448 enterprises returning to operations, a 26.9 per cent decline compared to October. A total of 4,768 enterprises ceased operations during the month, or 65.5 per cent less than in the previous month, of which 1,536 temporarily ceased operations, 3,232 enterprises were waiting for their business code to expire, and 827 enterprises were waiting to finish dissolution procedures.
In the first eleven months 18,646 enterprises went back into business, a 31.2 per cent increase year-on-year, which is a positive sign for the economy and due to solutions adopted by the government.
Most of the 8,468 dissolved enterprises in the first eleven months, which was a 2.2 per cent decline year-on-year, were small enterprises with registered capital of less than VND10 billion ($444,400). Of the total, 3,094 were limited companies, accounting for 36.5 per cent, 2,358 enterprises were limited partnership companies, or 27.9 per cent, 1,765 were private enterprises, or 20.8 per cent, and 1,251 were joint stock companies, or 14.8 per cent.
Among the 62,713 enterprises ceasing operations in the first eleven months, 21,899 were limited companies, representing 34.9 per cent, 20,223 were limited partnership companies (32.3 per cent), 12,156 were joint stock companies (19.4 per cent), 8,433 were private enterprises (13.4 per cent), and two were partnerships.
According to economic expert Ms. Pham Chi Lan, just as newly-established enterprises have reached their highest number for some time so has the number of dissolved enterprises. There are strong disturbances being felt in Vietnam’s business sector, she said, especially for small and medium-sized enterprises.