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Economic Sector

Last updated: Wednesday, February 22, 2017

 

Business Start-up Record: Evidence to Vitality of Business Environment

Posted: Wednesday, January 18, 2017

The number of corporate establishments set an all-time record of 110,100 units in 2016, an increase of 16.2 per cent over 2015, according to data from the Business Registration Agency under the Ministry of Planning and Investment.

The pledged capital amounted VND891,094 billion, or VND8.09 billion per business unit, up 48.1 per cent from 2015. Up to 26,689 companies resumed normal operations in the year, up 43.1 per cent from a year ago. Dang Huy Dong, Deputy Minister of Planning and Investment, said, this is evidence of the “vitality” of the business environment and the advent of investment opportunities.

Hanoi and HCM City see 53.7 per cent growth in business start-ups
As dynamic locomotives of development, Ho Chi Minh City and Hanoi saw record numbers of newly established enterprises in 2016 with 36,442 units and 22,663 units, respectively, followed by Binh Duong, Da Nang, Dong Nai, Hai Phong and Khanh Hoa.

By industry, the real estate industry had the most business start-ups with a growth of 83.9 per cent over 2015, followed by the health and social aid sector (up 52 per cent) and education (43.1 per cent). Up to 1.3 million jobs were created by newly established enterprises.

Nevertheless, some sectors saw declines in new start-ups, typically arts and entertainment (down 26.2 per cent), agriculture, forestry and fisheries (down 15 per cent).

Legal boosts
The above optimistic results were attributed to strong boosts by new laws such as the Law on Enterprise 2014 and Law on Investment 2014. In 2015, as soon as these laws took effect, the enterprise establishment registration time was reduced to just three days - a strong impact on business development. Corporate establishments and registered capital grew 26.6 per cent and 39.1 per cent, respectively. The time required to settle a set of enterprise establishment documents is just 2.9 days and the time required for dealing with enterprise registration information changes is only 2.05 days. Up to 86 per cent of documents were approved from the first application.

Online registration ratio beats target
In 2016, the Ministry of Planning and Investment upgraded technical infrastructure and updated applications to enable online business registration with over 100 processes of Level 3 or higher, including 95 processes of Level 4. The ministry also published all enterprise establishment registration processes. The status of corporate profiles and document processing is made public on the national information system for enterprise registration.

Ms Tran Thi Hong Minh, Head of the Business Registration Agency, said, 14 per cent of enterprise registration documents were filed online in 2016. In the fourth quarter of 2016, the rate was 35.26 per cent (higher than the target of 30 per cent set for 2017 in the Resolution 36a /NQ-CP of the Government.

The rates in Hanoi were 18 per cent in 2016 and 51.15 per cent in the fourth quarter of 2016. The respective rates in Ho Chi Minh City were 25.37 per cent and 62.06 per cent.

Nguyen Thanh

 





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