“To ensure successful busines start-up, in addition to passion and courage, there must be also innovation. Successful start-up will help develop businesses and revitalise the economy” emphasised by Mr Vuong Dinh Hue, Head of Central Economic Commission, at the National Entreprenuership Forum sponsored by Vietnam Chamber of Commerce and Industry (VCCI) and Central Economic Commission recently in Hanoi.
Human resource plays the key role
According to Mr Vuong Dinh Hue, human resource is the key to innovation. Innovation is most important for business start-up. National innovation capacity depends largerly on the quality of education and training, development of science and techonology and favourable business environment. Presently, Vietnam remains weak in science-technology and innovation development. National system of innovation development is still young and R&D is inadequate for business start-up. Meanwhile, business environment and national competitiveness remain at modest levels.
Mr Hue said that businesses operating in accordance with the Enterprise Law will develop in both quantity and quality, size and efficiency. Successful start-up will ensure long-term development serving either as “sattelites” for big and multi-national enterprises or developing larger in size. Together with the growth of businesses and groups, SMEs and private enterprises will become an important factor of the economy.
“The vigorous and in-depth economic integration under FTAs requires innovation and technology development by newly start-up businesses. It also demands continued restructuring and policies for investment, science-technology, incubators, human resources and innovation development suitable for higher productivity, quality and competitiveness”, Mr Hue reaffirmed.
Mr Hue said that there are five solution packages in the improvement of business start-up. They are: accelerating R&D to upgrade quality and efficiency, added value and domestic value, as well as global value chains for start-up businesses; solutions to diversify financial investment resources (financial support from State budget, investors, venture investments); capital access to banks and micro-financial organisations to promote growth of start-up businesses. In addition, there are problems of developing from “laboratory to market” of breaking technology, initiating markets for researches in medical, clean energy and education; diversifying business start-up programmes for young people in rural and mountainous regions; business training, human resources development at schools.
Enhanced training on business start-up
“As a matter of fact, business start-up in Vietnam is lower than many countries and even lower than in 2013. Regarding age groups, the standard of young people is lower than grown-up people and often subjected to failure” concluded Dr Luong Minh Huan, Business Development Institute –VCCI, in his report on Entrepreneurship Monitor 2014 at the forum.
According to Mr Huan, the fear is quite obvious among start-up businesses as they are deeply concerned about Vietnamese economy. Therefore, it is necessary to improve business environment and training on business start-up for young generation.
Business start-up index report 2014 shows that business start-up in processing industry is at the highest rank with lower percentage of giving up (23 percent) confirming the stability of Vietnamese businesses. The reason of giving up is largely due to failure in health, family or finance, some others for profit and better business opportunities.
According to the report, there is little change in business conditions in 2014 compared to 2013. There were only 3 among 13 indexes below the average namely government support programme, general education and openness of domestic market.
Basing on those indexes, Dr Luong Minh Huan and his group proposed the following recommendations: Vietnam should improve business conditions; upgrading business start-up programme; promoting professionism among young people and household businesses.
Entrepreneurship Monitor report 2014 is based on Global Entrepreneurship Monitor (GEM) initiated in 1999 with the participation of 10 developed countries. Presently, it attracts the participation of some 100 countries. The biggest study was conducted in 2014 interviewing 206,000 people representing 73 countries, 72.4 percent of the population and 90 percent of the GDP of the world. All activities creating jobs and income are business activities excepting in agriculture.
Mr David Devine
Canadian Ambassador to Vietnam
Under the guidance of VCCI, the Entrepreneurship Monitor has been evaluated most widely. Entrepreneurs are the driving force of economic development, generating jobs, national resources and also removing economic constraints. It helps illustrate more clearly Vietnamese economy and improve business environment. Business start-up should be highlighted in education system so as to avoid the mistakes of the past.
Mr Siri Roland Xavier
Association of Global Business Study
ASEAN Economic Community (AEC) will soon come into being. According to our preliminary survey of businesses on AEC, 36 percent agree or fully agree on higher competitiveness of AEC; 35 percent agree or fully agree on better conditions for business start-up and activities; 34 percent agree or fully agree that AEC is good for businesses. The survey shows that when AEC comes into force, many people know little about the operation of AEC to benefit from it. We should help business start-up to find business opportunities.
What can developed countries relying onresources in South East Asia do?Emphasis should be given to education and enrolment including in business education. Business education should be included in medium and long-term policy, ensuring equality in gender and income for women entrepreneurs, importing technology to increase local capacity and efficiency, reducing low added-value businesses and encouraging entrepreneurship.
Mr Vo Duy Khuong
Vice President of Da Nang Entrepreneurs Association
In Vietnam, business start-up remains more in form and number and less in quality, failing to attain objectives. In Da Nang, there are 3,000 college graduates each year but with small number of businesses unemployment increases. Many students are not trained in business start-up. In other countries, students are trained in business start-up from the first year. Business start-up culture remains low in Vietnam, failing to mobilize business community. It is necessary to develop business start-up culture in the whole society.
In Vietnam, most people care for safety against risk. Parents often choose profession and schools that ensure jobs. Therefore, government, agencies and localities should facilitate business start-up including initial investment (Support Fund).
In other countries, business start-up is included in university education programme. Vietnam should do the same to develop business culture.
Mr Luu Bich Ho
Former Director of the Institute of Policy and Strategy, Ministry of Science and Investment
Most of graduates tend to find a job before trying in business start-up. I often recommend them to find a job to get experiences before thinking of business start-up. In reality, some 100,000 businesses have failed and stopped operating. The true issue to reactivate them, help them in business activities.
It is important toheighten the role of associations in business start-up. Presently, only VCCI plays that role, other associations pay less attention and have fewer activities for business start-up. While state budget is small, budget of associations should be mobilized for this effort. The State should have a National Business Start-up Programme with specific plan of action and efficient staff.
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