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Business closures in HCMC on the rise despite economic recovery

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HCMC – Although HCMC reported economic recovery after containing the Covid-19 pandemic, a large number of enterprises have still been forced to close or suspend their operations.

According to the HCMC Department of Planning and Investment’s report delivered at a meeting on the city’s socioeconomic performance in August and the January-August period, the index of industrial production (IIP) in August gained 4% month-on-month.

The manufacturing and processing sector, in particular, picked up 4.6%, the electricity production and distribution sector 2.8% and the water supply and waste treatment sector 2.1%.

In January-August, the city’s IIP edged up 2.1% over last year’s period. The four key economic sectors of the city also posted a year-on-year rise of 2.5%.

Additionally, the city earned US$28.4 million in export revenue in the eight-month period, up 4% year-on-year.

The report also showed that the city disbursed nearly VND21.3 trillion (US$917.5 million) in public investment as of August 23, reaching 50.5% of the full-year’s target.

To accelerate the disbursement of public investment, the HCMC Department of Planning and Investment will this week submit a plan to the municipal government to move funds from projects with slow disbursement to those with a faster disbursement, Le Thi Huynh Mai, director of the department, said, adding that an action plan to speed up the disbursement until the end of this year will also be submitted next week so that the city can fulfill 95% of its public investment disbursement target.

Assessing the city’s socioeconomic performance in January-August, HCMC Chairman Nguyen Thanh Phong said the city has showed signs of recovery and growth may be faster in the last quarter.

Amid Covid-19, the public investment disbursement was positive as the disbursed amount was 2.35 times higher than the figure recorded in the same period last year. The public investment acceleration will help boost the city’s economic development, Phong said.

Despite the economic recovery, nearly 21,300 enterprises in the city suspended their operations in the eight-month period, up 5.33% year-on-year. Some 3,600 firms completed the procedures for disbandment and 10,400 others registered for a temporary suspension, rising 12.31% and 14.7% year-on-year, respectively.

Meanwhile, some 26,500 businesses were established in the city from January to August with total registered capital of VND562.2 trillion, down 6.75% in the number of newly-established firms but up 23.29% in registered capital.

At the meeting, city chairman Phong also asked departments and agencies to be prepared to inaugurate some projects funded by the city, such as the An Suong tunnel, the An Phu Dong steel bridge, the new Mien Dong coach station and the second campus of the HCMC Oncology Hospital and start work on projects to dredge the Soai Rap River and build an innovative startup center.

By Le Anh

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