Most Vietnam SMEs seek 'unofficial' loans: survey

TN News

Email Print

A whopping 90 percent of small- and medium-sized enterprises (SMEs) had to look for loans from "unofficial" sources because they were unable to access bank loans, reported on November 21, citing a recent survey.

This is an increase of four percentage points compared to 2009, local media cited the similar report in 2010.

Called "Characteristics of the Vietnamese Business Environment: Evidence from Small- and Medium-sized Enterprise Survey in 2011," the survey was the the seventh of its kind.

Its results, which is for 2011, were released on November 21 in Hanoi.

The survey, carried out in 10 cities and provinces including three economic hubs Hanoi, Ho Chi Minh City and Hai Phong, showed that the unofficial loans were small and only equal to around 9 percent of the total investment. But the companies said it made up a stable part of the companies' financial plans.

Nearly 39 percent of 2,500 SMEs covered by the survey, carried out by the Central Institute for Economic Management, Institute of Labour Science and Social Affairs, the United Nations University's World Institute for Development Economics Research and the Department of Economics of University of Copenhagen, said they faced difficulties in accessing bank loans.

"This result affirms that credit demands of the companies are very high but the barriers to loans haven't been removed," said Pham Thi Thu Hang of the Vietnam Chamber of Commerce and Industry. 

John Rand from the University of Copenhagen was quoted by as saying that the country should care more about this income group since it plays an important role in solving the unemployment and poverty issues in the country. 

Vietnam slipped 16 spots further in the ease-of-getting-credit ranking to 40 out of 185 economies this year, following a decrease of nine spots to 24 from a year earlier, according to Doing Business, a study published by the International Finance Corporation and the World Bank late October.

Like us on Facebook and scroll down to share your comment

More Business News