By Le Hoang

Stores along a street in HCMC have been shut due to Covid-19. Vietnam saw 101,719 businesses withdraw from the market last year – PHOTO: HUNG LE

HCMC – Some 101,719 businesses in Vietnam withdrew from the market in 2020, up 13.9% compared with 2019, highlighting the negative impacts of the Covid-19 pandemic on the corporate sector, data of the Business Registration Department indicated.

Nearly 46,600 businesses registered to temporarily suspend their operations, rising 62.2% year-on-year. Among them, 1,417 registered to suspend their operations for under one year, accounting for 3%, 22,414 for one to five years (48.1%), 12,626 for five to 10 years (27.1%) and 10,135 for over 10 years (21.8%). All 17 industries saw an increase in the number of businesses registering to temporarily suspend their operations.

Some 37,660 businesses halted their operations pending dissolution, while over 17,460 completed procedures for disbandment last year.

The sectors with the largest number of businesses pulling out of the market included retail and automobile and motorbike repair with 17,360 businesses (up 56.2% year-on-year), construction with 6,412 businesses (up 54.8%) and accommodation and catering services with 2,897 businesses (up 86.5%).

Other sectors with a large number of businesses quiting the market were science, technology, consulting services, design and marketing, seeing 2,880 businesses leave the market, up 69.2% year-on-year, and tourism, job services, equipment rental and supporting services with 2,820 businesses, up 87.6% year-on-year.

The real estate sector saw 1,325 withdrawals. However, the number increased 121.6% compared with 2019, the highest growth rate among all sectors. 

The education and entertainment sectors also saw a large number of businesses pull out of the market, with 878 businesses (up 89.6% year-on-year) and 350 businesses (up 73.3%), respectively.

Most of the suspended businesses were young and small ones, which were the most vulnerable to economic shocks. To reduce the number of businesses leaving the market, the Business Registration Department suggested that the Government and ministries improve the business environment, effectively implement supporting policies and extend stimulus packages.

On the other hand, 44,096 businesses resumed operations last year, rising 11.9% compared with 2019.

The sectors with the largest number of businesses returning to the market were retail and automobile and motorbike repair with 15,849 businesses (accounting for 35.9% of the total and increasing 3.7% year-on-year), construction with 6,545 businesses, the manufacturing and processing industry with 5,370 businesses and science, technology, consulting services, design and marketing with 2,860 businesses.

The increasing number of businesses resuming their operations signaled a recovery in most of the sectors. The Business Registration Department said although Covid-19 is still developing complicatedly elsewhere around the world, Vietnam’s effective containment of the pandemic and a population of nearly 100 million would facilitate the recovery of business.