COUNTRY CASE
Micro, Small and Medium Enterprises in Vietnam

Pham Van Hong

Vietnam National University
Hanoi, Vietnam
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Definition and Development

The definition of micro, small and medium enterprises (MSMEs) in Vietnam is stipulated in Law on Support for Small- and Medium-sized Enterprises by June 2017. As defined, MSMEs that have business registration in accordance with the Law is divided into three levels: micro, small and medium scale, basing on total capital (total capital equivalent to total assets determined in the balance sheet of enterprises) or number of employees per year, as given in Table 1.

The number of businesses in Vietnam increases every year with the growth rate varies by year (Figure 1). But in the past few years, there were also many died MSMEs (Figure 2). The high rate of died MSMEs in this period shows the vulnerability of business of the enterprises. The year 2014 witnessed 67,823 shutdowns or dissolutions nationwide, or an increase of around 11.7 percent compared to 2013, of which 9,501 enterprises completed dissolution procedures, 11,723 registered for termed shutdown, and the other 46,599 enterprises were waiting for business codes or remained unregistered.


 

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